(June 6 – 11:55 ET) – Figures for the first three months of the year show premiums written by the property and casualty insurance industry in Canada rose by 8.7% over last year, according to the latest issue of Perspective: A Quarterly Analysis of the Financial Performance of Canada’s P&C Insurance Industry.
“The increase in premiums is an encouraging sign that results may improve later this year,” says Paul Kovacs, an author of the report, and senior vice president of policy development and chief economist for the Insurance Bureau of Canada. “But insurers need to secure lower expenses, fewer losses and adequate prices to sustain improving underwriting results.”
Although premiums written increased over last year, the industry experienced underwriting losses of $312 million, just slightly greater than last year’s first-quarter posting of $305 million. In terms of overall earnings in 1999, the report found virtually no change from the previous year. Income was unchanged at $1.1 billion, with return on equity of 6.5% in 1999 and 6.8% in 1998.
Preliminary figures for the first quarter show earnings of the Canadian property and casualty insurance industry are up $141 million from the same period last year. The increase in earnings is attributable to recovering investment gains, up $241 million from the start of last year.
Regionally, while the Ontario home and auto markets and the Quebec auto market have improved marginally in recent months, the home and auto markets in the Atlantic provinces and some markets in British Columbia deteriorated significantly.
The report also shows that while the overall price for goods in Canada is 6% higher than it was four years ago, the price of auto insurance in Ontario has fallen by 10% on average over the same period.
-IE Staff