Desjardins Financial Security’s net income fell roughly 16% in the first quarter, but the company continued to experience growth in insurance premium income, Desjardins reported on Wednesday.

For the three months ended March 31, net income slipped to $30.5 million from $36.3 million in the same quarter last year at the subsidiary of Desjardins Group specializing in life insurance, health insurance and retirement savings.

Desjardins’ insurance premium income rose 3.2% to $669.2 million, and insurance sales jumped 10.5% to $65.1 million year-over-year, the company said.

“Despite the effects of the financial crisis, our life and health insurance subsidiary achieved significant growth in terms of business volume and remains a financially sound and strong company,” commented Monique Leroux, president and CEO of Desjardins Group, and CEO of Desjardins Financial Security. “Desjardins Financial Security continues to contribute significantly to Desjardins Group’s results.”

Return on shareholder’s equity was 17.5% for the quarter and assets under management and under administration totalled $19.5 billion.

Desjardins Financial Security’s financial strength has not been affected by the continued economic crisis, the company said. It still has a strong capitalization ratio and the fundamental insurance operations remain profitable, Desjardins said.

“Given these results, we are confident that going forward we will continue to strengthen and grow our business across Canada,” said Richard Fortier, chief operating officer of Desjardins Financial Security.

In group insurance, the volume of premiums generated by groups and businesses totalled $402.6 million, up from $392.8 million during the first quarter of 2008. Group and business insurance sales grew by $5.2 million for a total of $54.3 million.

Individual insurance sales surged 10.2% to $10.8 million. Sales by Desjardins Financial Security’s financial centre network rose by 6% in Quebec and 4.1% in the rest of Canada. Sales by financial security advisors assigned to Desjardins caisses stood at $4.7 million, up a sharp 16.5%. Gross premium volume totalled $125.8 million, up $5.6 million over the same period in 2008 for the individual insurance segment.

In savings, aggregate sales were $354.6 million, representing a $41.7 million increase over the previous year. In individual savings, aggregate sales were $221.6 million, up $127.5 million since the first quarter of 2008, while group retirement savings sales tumbled $11 million to $44.4 million.

IE