The Canadian Press

Intact Financial Corp. (TSX: IFC) reported a net loss in the third quarter as lower underwriting results and a non-cash accounting loss combined with the impact of lower market yields to weigh heavily on earnings.

The home and auto insurer reported Wednesday a net loss of $8 million or 7¢ per share in the quarter ended Sept. 30. This was a drop from year-ago net profit of $57.3 million or 47¢ per share.

Analysts had expected earnings per share of 24¢, according to estimates compiled by Thomson Reuters. Typically, such estimates strip out the impact of one-time financial items.

Net operating income for the quarter fell 80% to $21.6 million or 18¢ per share.

Intact said it recognized a non-cash accounting loss of $30.4 million during the quarter which was related to the increase in value of its preferred stock portfolio.

Intact said its positive automobile underwriting performance was offset by a high number of severe weather events over the summer that mainly affected property results.

“Despite the disappointing impact of these events, our underlying home insurance results continued to improve and our auto insurance business performed well both during the quarter and throughout 2009,” said Charles Brindamour, Intact’s president and chief executive officer.

“As the pricing environment shows increasing signs of firming up following a decline in underwriting margins, investment yields and excess capital across the industry, we are well positioned to take advantage of the underlying growth opportunities.”

The company added that its direct premiums written increased 4% in the quarter to $1.1 million with gains in all areas of its business reflecting increases in premiums and number or risks insured.

The company’s shares closed at $35.43 Tuesday on the Toronto Stock Exchange.