Co-operators 3-Q loss promises at future recovery

The Co-operators General Insurance Co. (TSX: CCS.PR.A) produced a net loss of $3.3 million for the third quarter of this year compared with an after-tax profit of $267,000 for the same period a year prior. The insurer’s net income for the first nine months of this amounted to $1.4 million, a significant turnaround from the $8.2 million net loss made for the same period a year ago. The loss for the third quarter equates to 23c a share.Co-operators’ gross written premium income rose by 8% to $480 million (2001 3-Q: $444 million) for the third quarter of 2002 over that of the same period last year. The insurer was able to reduce the claims ratio to 80.9% for the third quarter of this year compared with the 86.4% shown at the end of September 2001. The combined ratio for the latest quarterly reporting period clocked in at 108.9% against the 112.7% from a year ago.President Kathy Bardswick says she is encouraged by the improvement in the underwriting results, although bodily injury (BI) claims on the auto side continue to bedevil the company’s bottom-line. "Escalating costs associated with serious bodily injury claims continue to depress earnings despite double-digit premium rate increases. The situation is not helped by limited investment yields in the current volatile markets."