Here for you

Now and in the future

Here for Canadians –
now and in the future

As Canada celebrates its 150th birthday and its rich history, we are reflecting on our own journey.

Our business has grown significantly over the years, but we have never lost sight of our purpose – to help people, businesses and society prosper in good times and be resilient in bad times. We’ll continue to invest in our people, transform the customer experience, enhance our core capabilities, and strengthen our network from coast to coast to meet the changing needs of customers.

Building on our track record, we will work to make Intact Financial Corporation one of the most respected companies in Canada. We’ll be here for customers, employees, brokers and communities in the future, as we are today.

Year in review

Last year, severe weather events and unprecedented wildfires in Fort McMurray impacted communities across the country. These catastrophes are a stark reminder of the impacts of climate change. They reinforce the urgency to adapt to increases in severe weather events and help Canadians better protect their homes. I am proud of how our employees rallied to help customers get back on track. In adversity we found strength, witnessed compassion and saw communities, government and businesses come together.

In spite of record-breaking industry catastrophe losses, Intact delivered a solid combined ratio of 95.3% in 2016, resulting in net operating income of $660 million. Looking ahead, we remain confident in the action plans we have put in place, and in the underlying strength of our operations.

Direct premiums written grew by a robust 5% to reach $8.3 billion. Overall, we delivered a healthy operating return on equity of 12% despite $385 million in pre-tax catastrophe losses.

From a capital perspective, we ended the year with a strong balance sheet and $970 million in total excess capital. We also announced a 10% dividend increase, our 12th consecutive annual increase since we became a public company.

Quarterly Dividends per Share

Table View

Industry Outlook

Overall, we believe the P&C insurance environment remains favourable. We expect premiums to grow at a low to mid-single-digit rate over the next 12 months.

In personal auto, claims cost inflation should lead to rate increases in all markets. In personal property, we expect the current firm market conditions to continue, as companies adjust to changing weather patterns. In commercial lines, business remains competitive and the economy in Western Canada continues to pressure industry growth.

We expect the industry’s ROE to improve but remain slightly below its long-term average of 10% over the next 12 months. We outperformed the industry’s ROE by 6 points in 2016, and feel strongly about outperforming the industry’s ROE by 5 points going forward.

2017 and beyond

It is an exciting time for the P&C insurance industry. It is important that we prepare today for what is needed for tomorrow. We see many opportunities to drive change and to continue to outperform the industry – by putting customers first and leveraging our strengths.

We have accomplished much and delivered a solid performance in a year that saw unprecedented catastrophes. Our people’s hard work, engagement, and commitment to our values are key to our success. We will continue to experience headwinds but I am more confident than ever in our ability to adapt and respond to changing needs.

I want to thank customers, shareholders and brokers for their continued support. I also extend my appreciation to our Board of Directors for their continued insight and counsel. We will continue to stay true to our values, and strive to maintain your confidence and reward it in the years ahead.

Charles Brindamour Chief Executive Officer