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Canada’s big insurers say investment gains and business growth in the third quarter helped offset the costs of weather events and the Covid-19 pandemic.

Sun Life Financial Inc. reported underlying net income was up 6.7% to $902 million for the quarter ending Sept. 30, Manulife reported core net income was up 4.4% to $1.52 billion, and Great-West Lifeco Inc. reported net earnings were up 5% to $872 million.

The insurers all reported higher assets under management as they saw inflows of investments and market gains, with Sun Life up 11% to $1.39 trillion compared with the end of 2020, Manulife up 7% to $1.4 trillion over the same period, and Great West up 11% to $2.2 trillion.

All three also reported negative effects of the pandemic, particularly in their U.S. and Asian divisions.

Manulife said its earnings were impacted by a $152 million charge to its property and casualty reinsurance business for losses related to Hurricane Ida and European floods, and the effects of Covid-19 on policyholders in Asia and the U.S.

Anil Wadhwani, CEO of Manulife Asia, said on an earnings call Thursday that the pandemic affected the division both in sales and claims.

“We saw a significant impact on account of the resurgence of Covid in Southeast Asian market, and that had an impact on at two levels. One, we saw our sales volume get impacted; and the second, we experienced adverse policyholder experience specifically coming out of markets like Indonesia and Philippines.”

Great-West said third quarter earnings were down 31% in its capital and risk solutions division compared with last year because of major weather events and unfavourable U.S. life claims totalling $71 million from direct and indirect Covid-19 impacts.

And Sun Life said its U.S. business saw a 19% drop in underlying net income because of higher claims from Covid-19, as well as lower base earnings in its Asian division because of the effects of the pandemic especially in Indonesia and the Philippines.

Daniel Fishbein, president of Sun Life’s U.S. division, said on an earnings call Thursday that the higher claims in the U.S. came as Covid-19 hit working age people who have lower vaccine rates than those over 65.

“The third quarter was the worst quarter for mortality in the U.S. in the working age population since the pandemic began […] so in the third quarter, we saw a big shift in mortality into the working age population.”

Scotiabank analyst Meny Grauman said in a note that the key news from Sun Life was its upgraded expectations for return on equity to 16% for the medium-term, while the company’s performance in the U.S. and Asia both came in below expectations to impact results.

“We expect both of those impacts to be temporary, but they do take some of the shine off of what in our view is a constructive earnings release.”

Grauman said that Manulife core earnings per share were 4% below his expectations, but that overall the results were neutral.

“We see them as neutral thanks to a number of offsetting pluses and minuses, and most notably no major red flags.”

He said that a potential catalyst for Manulife is aggressive share buybacks if Canada’s financial services regulator lifts restrictions on them, as is expected to be announced Thursday.