Underwriting income down in 2007 Q1, claims up, OSFI figures show

Underwriting income is down and claims costs are up, according to 2007 Q1 financial figures posted by the Office of the Superintendent of Financial Institutions (OSFI), which oversees federally regulated property and casualty insurers in Canada.

The OSFI 2007 Q1 figures do not include financial data for many reinsurers or provincially regulated P&C insurers.

Also, the figures quoted herein do not reflect total industry data, because they exclude income statements of foreign P&C insurance companies that file financial statements with OSFI.

Canadian-based P&C insurers captured in the data collectively reported an underwriting income of $164 million in 2007 Q1. That compares with an underwriting income of $395 million reported in 2006 Q1.

Although total underwriting revenue increased from $5.523 billion in 2006 Q1 to $5.625 billion in 2007 Q1, underwriting income fell in part because of higher claims expenses in 2007 Q1.

In 2007 Q1, claims costs were reported at $5.46 billion, whereas during the same period in 2006, they were $5.127 billion.

Also, net investment income in 2007 Q1 trended downwards, according to OSFI figures. In 2007 Q1, Canadian P&C companies captured in the OSFI data reported a net investment income of $643 million in 2007 Q1. In contrast, in 2006 Q1, reported net investment income stood at $838 million.