Intact Financial Corporation has posted its financial results for the second quarter of 2021, revealing that it has beaten profit estimates as premiums increased 29% – a development driven by its recent acquisition of RSA.
The insurer posted operating income of CA$515 million (around £294.9 million), which translates into CA$3.26 per share. This reflects a 39% year-over-year increase from Q2 2020’s operating income of CA$350 million (around £200 million), or CA$2.35 per share. By comparison, analysts had pegged Intact’s net operating income per share for Q2 2021 at CA$2.37.
The RSA acquisition closed on June 01, 2021. Intact noted that it was “immediately high single-digit accretive” to net operating income per share. In that month alone, RSA contributed CA$734 million of written premiums and CA$57 million of underwriting income. Intact also indicated that in future quarters, the RSA Canada underwriting results will be included as part of Intact’s Canada lines of business results, while the UK & Ireland division will be reported separately.
Intact also reported a combined ratio of 86.7% for the second quarter of 2021, which includes 85.0% in Canada and 90.3% in the US. RSA Canada and UK&I came in at 90.7% during the period. The company has credited these results to “strong underlying performance” across all of its lines.
“Our strong results this quarter and year to date were driven by excellent operating performance across the business,” said Intact Financial CEO Charles Brindamour. “After several months of integration and transition planning, on June 01 we welcomed RSA’s employees to Intact and increased our premium base by 70%. This added scale enhances our ability to invest in our core capabilities of data, risk selection and claims.”
Brindamour added that Intact remains focused on growing its net operating income per share by 10% annually over time, and outperforming the industry ROE by 500 bps every year.
“With significant momentum in our business, we are well-positioned to emerge from the COVID-19 crisis in a strong position to continue to support our employees and communities, while delivering value for our shareholders,” the CEO stated.