25 February 2019 13:30
Photo : Freepik
Although anEconomical Insurance has registered net losses over the quarters in 2018, the insurer ends the year with a loss not as high as in 2017. For the fiscal year that ended last December 31, the net loss amounted to $ 73 million ($M), almost$ 20 Million less than the previous year.
Since 2017, the insurer has recorded a net profit for only one quarter, the first of 2017. In the fourth quarter of 2018, the insurer has managed to reduce its losses in half, from$ 28 Million in the corresponding quarter of 2017 to$13.4 Million.
Economical has also improved its combined ratio for the quarter and the year, which amounted, respectively, 108.9 % and 111,8 %.
“We continue to work hard to transform our company. While our combined ratio in 2018 remained at high levels, especially after one of our worst years weather, it was encouraging to end the year with a fourth quarter improved and a strong dynamic of growth driven by our strategic investments, ” said Rowan Saunders, president and ceo of Economical.
Mr. Saunders evokes the improvement of the insurer in its selection of risks and the rate increase across the portfolio of activities to explain the growth of premiums and the reduction of losses of subscription.
Vyne and Sonnet continue to affect the combined ratio
The investment that is Economical in its subsidiary Sonnet and its platform Vyne continue to have a negative effect on the combined ratio of the insurer. Overall, Sonnet and Vyne have added 4.5 percentage points to the combined ratio for the fourth quarter of 2018, compared to 8.3 points for the corresponding quarter of the previous year. For the full year, the impact is 6.1 percentage points, compared to 7.4 in 2017. The company, however, expects that the impact continues to be less in 2019.
“These investments should provide platforms for effective and scalable to support the future growth and profitability long-term. Vyne offers a more comprehensive range of products focused on the customer, a pricing model improved and a service experience and workflow improved for our partner brokers. It also increases the speed at which we can bring new products and price changes on the market. The short-term results are encouraging, with significant growth generated since the implementation of the platform, ” says the insurer.
The platform has been launched in Quebec and in Alberta in the last quarter, the two provinces where the rollout had not yet been done.