CO-OPERATORS GENERAL INSURANCE COMPANY REPORTS 2024 FOURTH QUARTER AND YEAR END RESULTS

This annual earnings news release should be read in conjunction with our 2024 audited consolidated financial statements and management's discussion and analysis (MD&A), which are all available on SEDAR+ at www.sedarplus.com. Unless otherwise noted, all amounts are expressed in Canadian dollars.

GUELPH, ON, Feb. 20, 2025 /CNW/ - Co-operators General Insurance Company (Co-operators General) today announced its consolidated financial results for the three months and year ended December 31, 2024. For the fourth quarter, Co-operators General reported consolidated net income of $100.8 million, compared to $98.5 million for the same quarter in 2023. Earnings per common share was $3.55 for the fourth quarter, compared to $3.48 for the same period last year. Net income for the year amounted to $245.1 million, compared to $151.4 million in 2023. This resulted in earnings per common share of $8.60 compared to $5.17 in the previous year.

"The Canadian insurance industry faced significant challenges in 2024 with a series of record-breaking climate-related weather events." said Rob Wesseling, President and CEO of Co-operators. "While these events affected our underwriting profitability through insured losses, we saw favourable growth in premiums and investment results, to end the year in a strong capital position. The catastrophic events in 2024 further highlight the need to stay focused on our long-term goal of building a more resilient and sustainable society."

CO-OPERATORS GENERAL'S FOURTH QUARTER AND YEAR END FINANCIAL HIGHLIGHTS

($ in millions except for earnings per common share and ratios)

	4th Quarter	4th Quarter	YTD	YTD
	2024	2023	2024	2023
Key financial data
Direct written premium (DWP)^1	1,447.2	1,261.1	5,597.6	4,891.2
Net insurance revenue (NIR)^1	1,277.9	1,125.8	4,809.6	4,278.7
Net income	100.8	98.5	245.1	151.4
Net investment income and gains	126.3	196.1	470.5	345.1
Total assets^4	8,521.9	7,695,7	8,521.9	7,695.7
Shareholders' equity	2,805.9	2,575.2	2,805.9	2,575.2
Key success indicators
DWP growth^1	14.8 %	13.9 %	14.4 %	11.2 %
NIR growth^1	13.5 %	10.2 %	12.4 %	8.1 %
Underwriting result - excluding discounting and risk adjustment^1	5.1	(46.2)	(106.9)	(184.9)
Earnings per common share (EPS)^2,3	$3.55	$3.48	$8.60	$5.17
Return on equity (ROE)^1	15.4 %	16.6 %	9.1 %	5.9 %
Combined ratio - excluding discounting and risk adjustment^1	99.6 %	104.0 %	102.2 %	104.4 %
Combined ratio - including discounting and risk adjustment^1	100.1 %	107.8 %	103.4 %	104.2 %
Minimum Capital Test (MCT)	216 %	236 %	216 %	236 %

¹ Refer to Key Financial Measures (Non-GAAP) Section.

² All of the common shares of CGIC are owned by CFSL; refer to the Dividends declared section for dividends
declared per share.

³ Earnings per share are calculated on a basic and diluted basis.

⁴ Comprised of current and non-current amounts which are disclosed in the notes to the consolidated financial
statements.

Fourth Quarter Review

Fourth quarter DWP increased by 14.8% over the same period of 2023 to $1,447.2 million, while NIR grew by 13.5% compared to the fourth quarter of prior year to $1,277.9 million. DWP and NIR growth over the comparative quarter was seen across all regions and lines of business, particularly in the auto and home lines of business. The increase in both auto and home was primarily attributable to growth in vehicles in force, policies in force and higher average premiums, particularly in the West and Ontario regions.

The loss ratio, excluding discounting and risk adjustment, improved by 1.6 percentage points driven by lower major event activity and reserve strengthening in the fourth quarter of 2024 when compared with prior period quarter. Fourth quarter expense ratio improved by 2.8 percentage points over the comparative period due to overall reduced insurance operations expenses.

Net investment income and gains for the fourth quarter was $126.3 million, a decrease of $69.8 million compared to the same quarter in the prior year. The decrease was primarily driven by unrealized gains in both our common share and bond portfolios being much higher in the prior year quarter. The unfavourable change was partially offset by higher interest income on bonds and increased dividend distributions.

Annual Review

We continued to grow proportionally across all core lines of business and in all regions in 2024 when compared to 2023. Higher average premiums and growth in vehicles and policies in force led to an increase in DWP of 14.4% and NIR growth of 12.4% over the prior year.

Our underwriting loss, excluding discounting and risk adjustment, for 2024 was $106.9 million, a favourable change of $78.0 million from the underwriting loss of $184.9 million in 2023. The favourable change was due to growth in NIR of $530.9 million outpacing the increases in both the net undiscounted claims and adjustment expenses of $376.2 million and acquisition and other expenses of $76.7 million. 

The increase in net undiscounted claims and adjustment expenses was primarily driven by higher major event activity related to four major events during 2024 as well as higher accident year claims. The increase in current year claims were partially offset by lower prior year claims development compared to the prior year. The increase in acquisition and other expenses was driven by the growth in premium, which resulted in increases in premium tax expense, net commissions and other acquisition expenses.

The four major events impacted our results this year, resulting in higher claims primarily in the home and auto lines of business. The year-to-date losses, net of reinsurance and inclusive of costs relating to reinsurance reinstatement premiums, from these events totaled $220.6 million.

During the year, the combined ratio, excluding discounting and risk adjustment, improved by 2.2 percentage points when compared to the prior year. The ratio including discounting and risk adjustment improved slightly by 0.8 percentage points. The relative improvement of the ratio was smaller due to the unfavourable impact of $61.5 million in net discounting and risk adjustment from a decrease in the yield curve compared to the prior year.

Net investment and insurance finance results increased by $59.2 million, representing $237.9 million in income in the current year compared to income of $178.7 million in the comparative period. The favourable result was primarily due to an increase of $125.4 million in total net investment income and gains when compared with the prior year, as a result of an increase in unrealized gains on our common shares portfolio, a decrease in net losses on our bond portfolio and higher net investment income earned from stronger reinvestment yields.

Our balance sheet, liquidity and capital positions remain strong and enable us to continue to serve and meet the needs of our clients while also supporting our strategic areas of focus. Our investment portfolio is comprised of high quality and well diversified assets. The credit quality of our bond portfolio remains high with 82.7% rated A or higher and 97.6% of our bonds being considered investment grade, rated BBB or higher. Our equity portfolio is 81.9% weighted to Canadian stocks.

Capital

Co-operators General's capital position remains strong, as the Minimum Capital Test for Co-operators General was 216% as at December 31, 2024, well above internal and regulatory minimum requirements. We continue to closely monitor capital levels in response to the changing economic environment.

CAUTION REGARDING FORWARD-LOOKING STATEMENTS

This document may contain forward-looking statements and forward-looking information, including statements regarding the operations, objectives, strategies, financial situation and performance of   Co-operators General. These statements generally can be identified by the use of forward-looking words such as "may," "will," "expect," "intend," "estimate," "anticipate," "believe," "plan," "would," "should," "could," "trend," "predict," "likely," "potential," and "continue," or the negative thereof and similar variations. These statements are not guarantees of future performance, and they involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in the forward-looking statements or information. We believe that the expectations reflected in the forward-looking statements and information are reasonable; however, there can be no assurance that such expectations will prove to be correct. We cannot guarantee future results, levels of activity, performance or achievements. Consequently, we make no representation that actual results achieved will be the same in whole or in part as those set out in the forward-looking statements and information. For further information, refer to our 2024 Annual Report.

ABOUT US

Co-operators is a leading Canadian financial services co-operative, offering multi-line insurance and investment products, services, and personalized advice to help Canadians build their financial strength and security. Co-operators has more than $71 billion in assets under administration and has been providing trusted guidance to Canadians since 1945. The organization is well known for its community involvement and its commitment to sustainability. Currently a carbon neutral organization, Co-operators is committed to net-zero emissions in its operations and investments by 2040, and 2050, respectively. Co-operators is also ranked as a Corporate Knights' Best 50 Corporate Citizen in Canada.

Co-operators General Class E Preference Shares Series C, trade under ticker symbol CCS.PR.C on the Toronto Stock Exchange (TSX).

For more information, please visit: www.cooperators.ca.

FOR FURTHER INFORMATION, PLEASE CONTACT:

Investor Relations
Lesley Christodoulou
Vice-President, Finance and Chief Accountant
Email: [email protected] 

Media Relations
Email: [email protected] 

SOURCE The Co-operators Group Limited