The country’s largest property and casualty insurer is raising rates by 15 to 20 per cent, but looking to drop auto premiums for Ontario drivers 5 per cent by moving to usage-based auto insurance.
According to
Intact’s CEO Charles Brindamour, the jump in P&C premiums is being laid at the feet of Mother Nature.
“Throughout 2013, we continued to clearly demonstrate the quality of our operations and the resilience of our financials,” said Brindamour, “as unprecedented weather events challenged our industry.”
Intact, which controls roughly 17 per cent of the market, is changing its product lineup offering incentives for loss-prevention measures like alarm systems and basement back-flow valves.
Intact’s financial results for the 2013 calendar year, reporting a whopping 244 per cent increase from 2012 in fourth-quarter catastrophe claims, but a slight drop in expense ratio year-over-year and a drop in commercial property and casualty premiums due to a reduction in earthquake exposure.
“2013 was marked by severe weather events, resulting in $781 million of insured losses from catastrophes or $530 million net of reinsurance,” stated Intact in a press release. “As a result, net operating income for the year was $500 million, down $175 million from 2012.” (continued.)
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Of particular interest to the Ontario market is Intact’s decision to push ahead with its own telematics solution in April, designed to reward safe drivers with targeted discounts. As stated in Intact’s analysis of its 2013 financial results, the insurer referenced the Ontario government mandate for provincial insurers to meet the 15 per cent reduction in premiums over a two year period, with an 8 per cent goal set for this August.
“(Intact) will be reducing rates by 5 per cent on average, targeting discounts to safe drivers… one strategy to identify safer drivers will be our launch of usage-based insurance in Ontario in April 2014.”
Although no details as to what form this usage-based insurance will take, the company had announced plans back in November to launch a telematics-based auto insurance in Quebec with similar programs being rolled out to other provinces in the following months.
Intact sells insurance under its own brand through brokers and through its
BrokerLink subsidiary, in addition to selling non-standard auto in Ontario under the Jevco brand, and directly to consumers through Grey Power and belairdirect.
