Home premiums up, commercial premiums down for RSA Canada

RSA Insurance Group plc released Thursday its interim management statement for the nine months ending Sept. 30, reporting a 2% drop in net written premiums in Canada, a 7% increase in household premiums and a 9% drop in commercial liability premiums in Canada, when currency fluctuations are taken into account.

For the first nine months of the year, London-based RSA reported net written premiums, group-wide, of £5.678 billion in 2014, down 16% from £6.741 billion during the same period in 2013. Those premiums dropped 9% if constant exchange rates are used.

The pound is currently trading at $1.82. The foreign exchange rates used in RSA’s results were $1.83 to the pound for the first nine months of this year, and $1.58 to the pound for the first nine months of 2013. The pound also rose relative to the euro and to the currencies of Denmark, Sweden Argentina and Chile.

In Canada, RSA’s net written premiums dropped 2% at a constant exchange rate, from £1.34 billion in the first nine months of 2013 to £1.135 billion during the same period of this year.

“In Canada, Personal Household continues to respond positively to the weather events of the last 18 months, although continued pressures on rate have impacted Commercial lines,” RSA stated, adding that a hailstorm in early August, which affected areas in and near Airdrie, Alberta, cost the insurer £11 million.

“Household premiums included double digit rate increases as the market continues to respond to the weather events of last year, volumes remained flat,” RSA said of its results in Canada. “In Motor, premium reductions reflected the exit of certain broker relationships and lower new business and rate in Ontario. “

In Canada, RSA’s household net written premiums were £322 million during the first nine months of this year, down 7% (but up 7% at a constant exchange rate) from £348 million in the same period in 2013. Also during the first nine months, motor premiums were £463 million this year, down 19% (or 6% at a constant exchange rate) from £570 million in 2013.

In commercial insurance in Canada, RSA had net written premiums of £350 million during the first nine months of 2014: £154 million in property, £86 million in liability, £71 million in motor and £39 million in marine and other

“In Commercial, premiums were down 4% driven mainly by the actions we have been taking on the portfolio, particularly where we have been re-underwriting or exiting poorer performing accounts,” RSA stated of its Canadian business. “Property reductions of 3% are mainly driven by underwriting actions taken in Quebec, and Liability reductions of 9% are due to the exit of unprofitable programs and market leading rating action.”

During the third quarter, RSA completed the sale of brokerage Noraxis Capital Corp. – which has operations in Alberta, Manitoba, New Brunswick, Nova Scotia and Ontario – to Itasca, Ill.-based Arthur J. Gallagher & Co.

RSA also noted Thursday that during the third quarter, it completed disposal of operations in Poland, Lithuania and Estonia.,

“We have also agreed the sale of our businesses in Singapore, Hong Kong, China and Italy,” RSA sstated.

Earlier this year, RSA announced it would “reduce its geographical spread” outside of a “core group” comprised of Britain, Ireland, Canada, Scandinavia and Latin America.