Intact Financial Corporation · TSX:IFC
Intact Financial — Q2 2023 Earnings Presentation
27 slides from Intact Financial's earnings presentation, 2023
Slide 1: Make it Intact – Q2-2023 Investor Presentation
Make it Intact INTACT FINANCIAL CORPORATION (TSX: IFC) Q2-2023 Page 1 INVESTOR PRESENTATION
Slide 2: Strategic overview; Balance sheet strength & capital management; Social impact
Strategic overview Pages 3 to 14 Balance sheet strength & capital management Pages 15 to 18 Social impact Pages 19 to 22 Page 2
Slide 3: Strategic overview
Strategic overview Page 3
Slide 4: Canada’s largest provider of P&C Insurance
Canada’s largest provider of P&C Insurance Our Purpose Who we are We are here to help people, businesses and society prosper in good Intact is the largest provider of P&C Insurance in Canada, a leading specialty lines times and be resilient in bad times. Insurer with international expertise and a le
Slide 5: A strong track record
A strong track record ROE1,2 outperformance Net operating income per share1,3 over 1210 bps2 time 1500 1490 bps bps 1480 1470 bps bps 1460 bps 1450 bps bps 1440 1430 bps 1420 bps 1410 bps bps 710 bps 22.5% 1400 1390 bps 830 bps 1380 bps 820 bps 1370 bps 1360 bps bps 1350 1340 bps 1330 1320 bps bps 1
Slide 6: What we are aiming to achieve
What we are aiming to achieve 2022 Kincentric Best Employer: • In Canada for the 7th consecutive year • In the US for the 4th consecutive year Representing the communities 70% of customers in we serve Canada who had a transaction 42% of Women and 13% Black and with us are our advocates People of Col
Slide 7: Our strategic roadmap
Our strategic roadmap Expand our leadership Strengthen our leading Build a Specialty position in Canada position in UK & Ireland Lines leader Expand broker (CL) Leading customer 3 out of 4 customers Leading customer Specialized customer Expand and direct (PL) experience digitally engaged experience
Slide 8: Outperformed industry ROE by 790 bps over the past five years
Outperformed industry ROE by 790 bps over the past five years Global leader in leveraging data and AI for Deep Claims expertise & strong supply Strong capital & investment management expertise pricing and risk selection chain network Loss ratio outperformance in all our Canadian lines of business1 1
Slide 9: RSA acquisition: the strategy accelerator
RSA acquisition: the strategy accelerator Expand our leadership Strengthen our leading Build a specialty position in Canada position in UK & Ireland solutions leader Financially compelling De-risking the transaction further ▪ Q2-2023 marks the two-year anniversary of the RSA ▪ Exited UK Personal Lin
Slide 10: Expand our Leadership Position in Canada
Expand our Leadership Position in Canada Capitalize on our clear scale advantage in a fragmented market Leading customer Leader in a fragmented Canadian market Distribution income2 adds a strong and diversified earnings experience stream that supports our ROE objectives. - TOP 5 - 48% MARKET SHARE C
Slide 11: Build a Specialty Solutions Leader
Build a Specialty Solutions Leader Capitalizing on a vast market opportunity, while maintaining a sub-90 operating combined ratio Leading global franchises in marine and specialty property With the RSA acquisition, we can access over 70% of Specialized customer the global specialty lines market, or
Slide 12: Strengthen Our Leading Position in the UK & Ireland
Strengthen Our Leading Position in the UK & Ireland Leverage RSA’s strong brands and scale positions to build outperformance A leading Personal and Commercial insurer in UK and Ireland. Achieve a low 90s combined ratio by applying our risk Leading customer experience selection and claims management
Slide 13: Our ambitions are clear
Our ambitions are clear 12-Month Medium to long-term ambitions Guidance UK & Personal lines: Commercial lines: Profitable Low 90’s 2024 International High 90’s Low 90’s Growth performance Personal Personal Commercial DPW: 5pts CR Canada auto: property: lines: $20B outperformance 2027 Sub-95 Sub-95 L
Slide 14: Balance sheet strength & capital management
Balance sheet strength & capital management Page 14
Slide 15: Maintaining a strong balance sheet
Maintaining a strong balance sheet High quality investment portfolio Prudent reserving practices Strong capital base Conservative investment strategy underpins PYD ratio2 (2018-2022) (as a % of net earned premiums) Total Capital Margin3 balance sheet strength 3.8% 3.8% $2.5B 1.9% 0.0% Total capital
Slide 16: Proven and consistent capital management strategy
Proven and consistent capital management strategy Capital Low book value per share sensitivity to Deployment capital markets volatility2 -2% per 10% decrease in common share prices3 Manage volatility -2% per 100 bps increase in interest rates Adjusted debt-to-total capital ratio1 22.5% Maintain leve
Slide 17: Significant opportunity for further M&A
Significant opportunity for further M&A Underwriting: fragmented market to consolidate Distribution: significant opportunity to expand 1 4% 19% IFC 3,000+ CANADA: 11% Mutual (top 50) 10-15 pts 60% 36% brokers in market Focus to expand our 70% of industry share leadership position Adressable expected
Slide 18: Social impact
Social impact Page 18 Page 18
Slide 19: Our customers are our advocates
Our customers are our advocates Insurance is about people, and helping people be resilient in bad times is the reason we’re here. It’s also why being Customer-driven is one of our Values. Getting our customers back on Supporting brokers with our An enhanced digital experience track specialized exper
Slide 20: Our people are engaged
Our people are engaged Our people are central to our success. That’s why we invest in the well-being and development of our employees and create an environment where they can be resilient and thrive. Be a best employer 77% 79% 77% 52% Across the UK&I operations, we rolled out our employee engagement
Slide 21: Being a most respected company
Being a most respected company Being a most respected company is about financial outperformance and helping society. Building resilient communities speaks to our purpose and builds on over a decade of investment and leadership. Our climate strategy Adapt Building economically Contributing to communi
Slide 22: Appendix
Appendix I Page 22
Slide 23: Q2-2023 IFC financial highlights
Q2-2023 IFC financial highlights Operating DPW1 (constant currency) Combined ratio1 BVPS1 $6.2B 6% 96.3% 6.1 pts (undiscounted) and 92.2% 4.2 pts (discounted) $76.29 NOIPS1 EPS OROE1 ROE1 Total Capital Margin $2.30 30% $1.30 81% 12.8% 9.0% $2.5B 119.2% Operating net Operating combined $326M 98.0% 96
Slide 24: P&C insurance industry outlook
1 P&C insurance industry outlook In UK property, rate increases in firming market conditions are expected Industry premium growth expected to grow in the high single-digit range in the next twelve months In Ireland property, rates are experiencing low single reflecting inflation and evolving driving
Slide 25: Contact us
Contact us Investor Inquiries Intact Financial Corporation 700 University Avenue Toronto, ON M5G 0A1 ir@intact.net www.intactfc.com Investor Relations Shubha Khan Vice President, Investor Relations 1 (416) 341-1464 ext. 41004 shubha.khan@intact.net Media Inquiries David Barrett Director, Media, Soci
Slide 26: Forward-looking statements
Forward-looking statements Certain of the statements included in this presentation about the Company’s current and future plans, expectations and intentions, results, levels of activity, performance, goals or achievements or any other future events or developments constitute forward-looking statemen
Slide 27: Disclaimer
Disclaimer This presentation does not constitute or form part of any offer for sale or solicitation of any offer to buy or subscribe for any securities nor shall it or any part of it form the basis of or be relied on in connection with, or act as any inducement to enter into, any contract or commitm