OSFI results show $1.2 billion Q2 profit for insurers

The latest quarterly financial filings by Canada’s property & casualty insurers shows an industry profit of $1.24 billion in the second quarter ending June 30, 2004. This compares with net income of $584.4 million as reported by the Office of the Superintendent of Financial Institutions (OSFI) for the second quarter of 2003.Combining commercial and auto premiums together, insurers brought in gross written premiums of $11.07 billion for the most recent quarter, versus $10.38 billion the year prior. Net premiums earned in the second quarter of 2004 were $9.70 billion, up from $8.35 billion a year ago.Overall, the industry was able to produce an underwriting profit of $800.0 million, a vast improvement over the underwriting loss of $9.4 million posted in the second quarter of 2003. At the same time, investment income grew slightly, up to $981.0 million for the second quarter of 2004 from $894.9 million the year previous. However, the industry shelled out $620.0 million in income taxes in the most recent quarter, compared to just $279.8 million in second quarter 2003.Of note, the industry’s score on the minimum capital test (MCT), which is measured as total capital available as a percentage of minimum capital required, dropped to 214.8% in the second quarter of this year, still well above the 150% required by regulators, but down from the 222.2% figure seen a year ago.