Slide 1: Intact Financial Corporation: Review of performance Q4-2012
Intact Financial Corporation (TSX: IFC) Building a world-class P&C insurer Review of performance Q4-2012 Wednesday, February 6th, 2013
Slide 2: Charles Brindamour, Chief Executive Officer
Charles Brindamour Chief Executive Officer
Slide 3: Q4-2012 key points
Q4-2012 key points Highlights • Net operating income per share up 25% to $1.42, reflecting a 92.1% combined ratio • Premium growth of 7%, bolstered by the addition of JEVCO • Operating ROE of 16.8% with an 11% increase in book value per share in 2012 • Quarterly dividend raised 10% to $0.44 per shar
Slide 4: The personal auto environment
The personal auto environment Ontario Auto Alberta Auto • No change to our view of the • Level of activity on bodily injury files in effectiveness of the reforms litigation has increased in recent months • Favourable prior year development • Results beginning to be impacted by a impacted by uncertai
Slide 5: Exceptional results in personal property
Exceptional results in personal property Claims ratio improved 22 points versus Q4-2011 88.6% 67.1% • 11 points of higher favourable 6 pts PYD PYD, of which 6 points is (one time) ‘one-time’ in nature 53.6% 31.7% 5 pts PYD • 5 points from a decline in the level of CAT losses 5 pts CATs • Current yea
Slide 6: Canadian P&C industry 12-month outlook
Canadian P&C industry 12-month outlook We remain well-positioned to continue outperforming the Canadian P&C insurance industry in the current environment • Industry premium growth is likely to evolve at a similar pace to that of the Premium growth last 12 months • Low interest rate environment will
Slide 7: Summary and key takeaways
Summary and key takeaways We believe the 92.1% combined ratio is indicative of our underlying performance in the quarter, despite large year-over-year movements in the reported results of our personal lines businesses Integrations are progressing well, and on many fronts, better than we expected We
Slide 8: Mark Tullis, Chief Financial Officer
Mark Tullis Chief Financial Officer
Slide 9: Q4-2012 Financial highlights
Q4-2012 Financial highlights (in $ millions, except as otherwise noted) Q4-2012 Q4-2011 Change FY-2012 FY-2011 Change Direct premiums written 1,690 1,576 7% 6,868 5,099 35% Net underwriting income 138 118 17% 451 273 65% Combined ratio 92.1% 92.7% (0.6) pts 93.1% 94.4% (1.3) pts Net operating income
Slide 10: Personal lines
Personal lines (in $ millions, except as otherwise noted) Q4-2012 Q4-2011 Change Combined Ratio Breakdown Personal Auto Direct premiums written 722 664 9% 25.7% 25.1% Expense Underwriting income (loss) (25) 52 (148)% Ratio 77.4% 68.2% Claims Combined ratio 103.1% 93.3% 9.8 pts Ratio Q4-2012 Q4-2011
Slide 11: Commercial lines
Commercial lines (in $ millions, except as otherwise noted) Q4-2012 Q4-2011 Change Combined Ratio Breakdown Commercial Auto Direct premiums written 146 130 12% 29.5% 29.8% Expense Underwriting income 23 10 130% Ratio 54.7% 63.2% Claims Combined ratio 84.2% 93.0% (8.8) pts Ratio Q4-2012 Q4-2011 • DPW
Slide 12: High quality investment portfolio
High quality investment portfolio Net investment gains (losses) $13 billion – conservatively managed (in $ millions, except as otherwise noted) Note: Investment mix is net of hedging positions and financial liabilities related to investments. Q4-12 Q4-11 Change Fixed income securities Loans, 3% Cash
Slide 13: Financial position remains solid
Financial position remains solid Our financial position remains solid with $599 million in excess capital and an estimated MCT of 205% Book value per share of $33.03, 11% higher than a year ago Operating ROE of 16.8% for 2012 Debt-to-capital ratio of 18.9% is below our target of 20% 13
Slide 14: Integrations are on track
Integrations are on track AXA Canada JEVCO • Retention on the AXA Canada portfolio • Policies now being renewed on IFC is comparable to that of the Intact systems portfolio, and broker support continues • We are targeting $15 million of after-tax to be strong synergies by the end of 2014 • System sh
Slide 15: Strategic, operational and financial strength
Strategic, operational and financial strength • Largest P&C insurance provider in Canada • Solid financial position • Excellent long-term earnings power • Organic growth platforms easily expandable Our solid financial position and disciplined approach to the business provide a strong foundation from
Slide 16: Q1-2013 earnings call Wednesday, May 8th, 2013
Q1-2013 earnings call Wednesday, May 8th, 2013
Slide 17: Investor Relations contact information
Investor Relations contact information Dennis Westfall, CFA Maida Sit, CFA Vice President, Investor Relations Manager, Investor Relations Phone: 416.341.1464 ext 45122 Phone: 416.341.1464 ext 45153 Cell: 416.797.7828 Email: Maida.Sit@intact.net Email: Dennis.Westfall@intact.net General Contact Info
Slide 18: Forward looking statements and disclaimer
Forward looking statements and disclaimer 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-l
Slide 19: Forward looking statements and disclaimer
Forward looking statements and 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 inducem