The Co-operators reports net loss for Q3 after impact of GTA summer storm

The Co-operators General Insurance Company has reported a consolidated net loss of $37.9 million for the third quarter of the year, compared with a $12.6 million net income for the comparable quarter in 2012, citing this summer’s heavy rain storm as having a major impact on results.

For the first nine months of the year, the insurer’s net income is $14.3 million, a decrease of $129.2 million from the same period last year, the Guelph, Ont.-based company reported.

“The heavy rains and flooding in the Greater Toronto Area, which were the most costly natural disaster in Ontario’s history, had a very significant impact on our financial results this quarter. The estimated net losses from July’s catastrophic event were $47.9 million,” Kathy Bardswick, president and CEO of the Co-operators noted in a statement on the results.

“Despite the recent weather-related challenges we’ve faced, the organization’s financial strength is solid,” she added. “Our capital position remains strong, and we were pleased with the growth we achieved in the auto, home and commercial lines of business across the country.”

Direct written premium increased in Q3 to $594.3 million from $561.4 million in the same period last year, an improvement the company attributes to “policy count growth in the auto, home and commercial lines of business as well as home portfolio rate and inflation adjustments.”

Net earned premium increased during the third quarter by 3.3% or $16.9 million compared to the same period last year.

The combined ratio, excluding the market yield adjustment (MYA) for the quarter, was 114.3% compared to 105.7% for the same period last year, the company reported.

Net investment income and gains decreased by $30.5 million versus the third quarter of 2012 which the insurers attributes to realized and unrealized losses, mainly the result of increasing interest rates which decreased the value of its portfolio holdings.