Levis, Que.-based life and health insurer Desjardins Financial Security (DFS) reports that net income fell during the fourth quarter to $60.8 million from $104.3 million for the same quarter in 2011.

Insurance premiums for the quarter ended Dec. 31, 2012 were $835.7 million versus $781.6 million in 2011.

Insurance sales totalled $82.2 million compared to $83.3 million for the same period last year.

On the savings side, total sales came to $450.1 million versus $474.2 million for the same period a year ago.

For the year ended Dec. 31, DFS says it posted a 5% increase in insurance premiums, which totalled $3.2 billion.

The subsidiary of Desjardins Group attributes the improvement in premiums to increased business volume in all insurance sectors.

For the year, insurance sales stood at $463.5 million, compared to $433.4 million for the same period in 2011, for an increase of 6.9%.

Savings product sales were up 15.5% to $2.2 billion from last year’s $1.9 billion. Company profitability stood at $217.0 million compared to $281.8 million in 2011.

Despite business growth in 2012, the DFS says the “company’s lower profitability is due to less favourable economic conditions, which exerted pressure on the entire insurance and financial services industry, to a deteriorating disability insurance claims experience and to adjustments in actuarial liabilities dictated by the need for prudence in this current environment.”

The share of net income attributable to the shareholder, Desjardins Financial Corp., totalled $163.1 million. Return on shareholder equity was 10.3%, in a context that required DFS to exercise caution by adjusting its actuarial liabilities and increasing its capitalization.

DFS assets under management and administration totalled $34.4 billion as at Dec. 31, 2012 versus $33.0 billion at the end of 2011.

Commenting on the DFS results, Monique Leroux, chairwoman of the board, president and CEO of Desjardins Group and CEO of DFS, noted that “Once again, despite tough economic conditions, our life and health insurance subsidiary remained on its growth course in 2012, while consolidating its capital base and maintaining excellent financial stability.”

DFS employs more than 3,700 people and administers $34.4 billion in assets from offices in several cities across the country.