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5 = Summary =
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7 * Intact Financial Corporation is the largest provider of property and casualty (P&C) insurance in Canada, a leading provider of global specialty insurance, and, with RSA, a leader in the U.K. and Ireland.
8 * The company has grown organically and through acquisitions to over $20 billion of total annual premiums.
9 * The company has a global team of more than 26,000 employees
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12 [[image:IFCZF0.jpg||height="346" width="719"]]
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15 = Company Overview =
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17 Intact Financial Corporation (TSX: IFC, OTC:IFCZF) is the largest provider of property and casualty (P&C) insurance in Canada, a leading provider of global specialty insurance, and, with RSA, a leader in the U.K. and Ireland. The company's business has grown organically and through acquisitions to over $20 billion of total annual premiums.{{footnote}}https://www.intactfc.com/English/about-us/default.aspx{{/footnote}}
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20 In Canada, Intact distributes insurance under the Intact Insurance brand through a wide network of brokers, including its wholly-owned subsidiary BrokerLink, and directly to consumers through belairdirect. Intact also provides affinity insurance solutions through the Johnson Affinity Groups.
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23 In the U.S., Intact Insurance Specialty Solutions provides a range of specialty insurance products and services through independent agencies, regional and national brokers, and wholesalers and managing general agencies.
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26 Outside of North America, the company provides personal, commercial and specialty insurance solutions across the UK, Ireland, Europe and the Middle East through the RSA brands.
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29 Intact Financial is evolving its products and services to ensure that the company continue to meet customers’ changing needs. By leveraging data and technology Intact Financial has made it easier for customers to connect with it in the way they prefer, be it online, on the phone or in person through a broker.
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32 [[image:IFCZF1.jpg]]
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35 = Products =
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37 Products are available through the following brands and companies:
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39
40 **Canada**
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42 * Intact Insurance
43 * RSA
44 * belairdirect
45 * Johnson
46 * BrokerLink
47 * Intact Public Entities
48 * Intact Prestige
49 * Intact Insurance Specialty Solutions
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51 On Side Restoration: In Canada, Intact provides repair and restoration services through its subsidiary On Side Restoration, a leading restoration company, restoring damaged homes and businesses.
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54 **United States**
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56 * Intact Insurance Specialty Solutions
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59 **UK & International**
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61 * RSA
62 * MORE THAN
63 * 123.ie
64 * Al Ahlia
65 * Al Alamiya
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68 **Scandinavia**
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70 * Codan
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73 [[image:IFCZF2.png]]
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76 = Company History =
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78 Intact has a long and proud Canadian history. Intact Financial is one of Canada’s oldest companies. The company's roots date back to 1809 when a group of business people formed the Halifax Fire Insurance Association, later known as the Halifax Insurance Company. In the late 1950s, following the post-war Dutch immigration, the Nationale-Nederlanden, then one of the largest insurance companies in the Netherlands came to Canada and acquired the Halifax Insurance Company.{{footnote}}https://www.intactfc.com/English/about-us/our-history/default.aspx{{/footnote}}
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81 |**Year**|**Milestones**
82 |1980s|acquired three well-known regional insurers - Commerce Group and Belair in Quebec, and Western Union in Alberta
83 |1991|Nationale-Nederlanden merged with NMB Postbank to create ING Group, one of the first bancassurance groups in the world
84 |1993|we brought together the separate entities under the umbrella of ING Canada
85 |1998|acquired Guardian Insurance’s business in Canada
86 |2001|acquired Zurich Canada’s home, auto and small and medium business insurance portfolio. Halifax Insurance Company, Commerce Group and Western Union were later merged to form ING Insurance. Belair became the first company in North America to offer insurance products online under the name belairdirect
87 |2004|acquired Allianz Canada. This was soon followed by our Initial Public Offering, and we started trading on the Toronto Stock Exchange with ING Group retaining 70% ownership
88 |2009|ING Canada became Intact Financial Corporation, with 100% of its common shares traded on the TSX following ING Group’s divestiture of its holdings
89 |2011|acquired AXA Canada Inc., the 6th largest property and casualty insurance provider in the country
90 |2012|acquired Jevco Insurance Company, a leading provider of specialty and niche insurance products for individuals and businesses in Canada
91 |2015|acquired Canadian Direct Insurance Inc. (CDI), a property and casualty insurance company providing direct-to-consumer personal insurance solutions throughout British Columbia and Alberta. CDI was subsequently integrated with belairdirect, expanding its operations from coast to coast
92 |2017|acquired OneBeacon Insurance Group, Ltd.; a leading U.S. specialty insurer focused on small to midsize businesses. The transaction makes us a leading speciality insurer in North America with over C$2 billion in annual premiums
93 |2019|acquired a controlling interest of On Side Restoration, a leading restoration company, restoring damaged homes and businesses in Canada. Intact will gain full ownership of On Side Restoration over a two-year period. The transaction will strengthen repair and restoration services for personal and commercial property claims customers across Canada.
94 |2019|acquired The Guarantee Company of North America, a specialty lines insurer in Canada and the U.S., and Frank Cowan Company Limited, a managing general agent focused on specialty insurance.
95 |2020|gained full ownership of On Side Restoration, a leading restoration company, restoring damaged homes and businesses in Canada, strengthening the repair and restoration services for personal and commercial property claims customers across Canada.
96 |2021|together with Tryg A/S, Intact acquired RSA Insurance Group –- one of the world’s longest standing general insurers – expanding its operations to the UK, Ireland, Europe and the Middle East through the RSA brands.
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99 [[image:IFCZF3.png]]
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102 = Business Segments =
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105 **Personal auto – CANADA**
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107 The company provide various levels of coverage to its customers for their vehicles, including accident benefits, third party property and physical damage. The company's coverage is also available for motor homes, recreational vehicles, motorcycles, snowmobiles and all terrain vehicles.
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110 **Personal property – CANADA**
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112 The company provide various levels of protection to its customers for their homes and contents from risks such as fire, theft, vandalism, water damage and other damages, as well as personal liability coverage. Property coverage is also available for tenants, condominium owners, non-owner-occupied residences and seasonal residences.
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115 **Commercial lines (including specialty lines) – CANADA**
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117 The company provide a broad range of coverages tailored to the needs of a diversified group of small to medium-sized businesses. Commercial property coverages protect the physical assets of a business. Liability coverages include commercial general liability, product liability, professional liability, as well as cyber endorsement. Commercial vehicle coverages provide protection for commercial auto, fleets, garage operations, light trucks, public vehicles and the specific needs of the sharing economy.
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120 **Personal lines – UK&I**
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122 The company provide various levels of coverage to its customers for their home, motor, pet and other insurance products in the UK, Ireland and the Middle East
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125 **Commercial lines (including specialty lines) – UK&I**
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127 The company provide a broad range of general insurance, specialty lines and risk management expertise for businesses and other organisations in the UK, Ireland, the Middle East, France, Belgium, Spain and the Netherlands.
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130 **Commercial lines (specialty lines) – US**
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132 The company provide a broad range of specialty insurance solutions tailored to meet the unique needs of specific industry segments or product/customer groups. Businesses serving targeted industry segments include accident and health, technology, ocean marine, inland marine, public entities, entertainment, financial services, and financial institutions. Businesses offering distinct specialty products to broad customer groups include specialty property, surety, tuition reimbursement, management liability, cyber and environmental.
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135 [[image:IFCZF4.png]]
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138 = Financial Highlights =
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140 Net operating income per share (NOIPS) grew 25% to $12.41 in 2021 and operating ROE stood at 17.8%, driven by robust underwriting and distribution income, as well as meaningful accretion from RSA.{{footnote}}https://s1.q4cdn.com/321139868/files/doc_financials/2021/ar/AR_ENG_Mar29_clean_full.pdf{{/footnote}}
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143 The company's overall combined ratio of 88.8% reflected strong underlying performance and favourable prior year claims development. Operating direct premiums written grew 45% to $17.3 billion, fuelled by the RSA acquisition and solid organic growth.
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146 Net investment income increased 22%, mainly on account of growth in the investment portfolio following the RSA acquisition. In its distribution business, income grew 32% to $362 million, driven by higher variable commissions and accretive acquisitions.
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149 The integration of RSA is on track across all geographies. With a 12% accretion to NOIPS in the seven months since the transaction closed, Intact Financial has increased confidence in the quality of the acquired portfolio and expected synergies.
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152 The company's balance sheet remains strong, with $2.9 billion of total capital margin and solid regulated capital ratios in all jurisdictions. With the sale of its 50% stake in Codan DK expected to close in the first half of 2022, the adjusted debt-to-total capital ratio will return to its target of 20%.
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155 Given solid momentum across the business and a robust balance sheet, the company were pleased to increase the quarterly dividend by 10% to $1.00 per share and initiate a share buyback program in February 2022.
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158 The company's financial objectives are to increase NOIPS 10% annually over time and outperform the industry ROE by 500 bps every year. The company continue to meet and exceed this objective, with NOIPS well over 10% this year, and an estimated ROE outperformance of 750 bps in 2021. The company's track record over the past decade is strong, with NOIPS compounding at 12% annually and its estimated ROE outperformance averaging 640 bps.
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161 == Outlook ==
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163 As economies emerge from the pandemic, the company expect to operate in an inflationary environment, with dislocation in supply chains and a tight labour market. Interest rates will most likely continue to rise in the near- to-mid-term. While economies are currently robust, the company expect to operate in a period of suppressed growth over the mid-term. The war in Ukraine and the resulting humanitarian crisis will exacerbate these conditions. As a result, the company remain prudent in managing its resources. The company will focus on identifying and managing claims inflation while being open to the opportunities presented in this environment.
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166 Looking specifically at the insurance industry where the company operate, the company expect poor pre-pandemic underwriting performance, inflationary pressures, the war in Ukraine and capital markets volatility will keep capacity and supply of insurance tight. This will result in rising prices in the near to mid term. As an outperformer with a solid capital position, this environment plays to its strengths.
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169 In Canada, the company expect firm market conditions to continue in personal property, while personal auto rates remain tempered in the pandemic environment.
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172 In commercial lines across the U.S., Canada, and the UK & Ireland, firm pricing conditions are expected to continue. In UK personal lines, near-term industry growth levels are uncertain as companies navigate the recently introduced pricing reforms.
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175 = References =
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177 {{putFootnotes/}}
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