Canada’s big three life insurers enjoyed stronger earnings last year and are on track for another solid year in 2019, says Fitch Ratings.
The rating agency reported that the big three insurers — Great-West Life, Manulife and Sun Life — recorded better results in 2018, thanks to their strong diversification in terms of both geography and product lines.
“Earnings were strong and in line with rating expectations, while balance sheet strength persists with all three organizations,” said Jamie Tucker, director with Fitch Ratings.
Looking ahead, Fitch said it expects the big three to have another strong year in 2019.
“Industry results continue to benefit from relatively benign credit market conditions,” Tucker added. “Results in 2019 are expected to reflect improved expense efficiencies, while the organizations invest in digitizing their businesses.”
In terms of the insurers’ financial fundamentals, Fitch said, “Financial flexibility is strong with significant dry powder to pursue M&A in order to improve scale and profitability in certain segments.”