IBC’s Perspective:

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A Quarterly Analysis of the Financial Performance of Canada’s P&C Insurance Industry

August 2001.


  • The troubles continue, as three years of disappointing earnings for the insurance industry
    have given way this year to almost no earnings at all. Industry profitability is unlikely to be restored
    this year.

  • The trend digs in, as more comprehensive data on industry reserve development released
    since last quarter confirms the declining trend in the margin on unpaid claims. Reduced margins highlight
    the importance of focusing on underwriting to address weak profits.

  • The new data for second quarter 2001 point out that underwriting results continued to show
    weakness as claims growth again surpassed premium growth. Despite premium growth of 10.3 percent, rapid
    claims growth and lower investment returns are likely to challenge insurers throughout 2001.

  • Commentary on death, taxes and regulation. Canada is a good market for P&C Insurers,
    but persistent high taxes and excessive regulation limit potential.

Review Perspective (in ADOBE pdf)