(TSX: DFY)
(in Canadian dollars except as otherwise noted)
WATERLOO, ON, Nov. 5, 2026 /CNW/ --
Highlights
-- Integration of the acquired Travelers business2 continues to progress
well, with the continued realization of integration benefits reflecting
the increased synergy expectations announced last quarter
-- Gross written premiums1 increased 36.2% in Q3 2026, driven by strong
retention of the acquired business and solid underlying growth
contribution3, keeping us on track to achieve our full-year target of
$6.5 billion
-- Consolidated combined ratio1 of 100.6% in Q3 2026, reflecting 12.8
percentage points of catastrophe losses1
-- Operating net income1 of $43.9 million in Q3 2026 resulted in operating
EPS1 of $0.36; trailing 12-month operating ROE1 was 10.3%
-- Financial position remained strong at the end of Q3 2026, with book value
per share1 of $34.53, up 3.3% from a year ago, and approximately $1.2
billion of financial capacity1
Executive Messages
"Our third quarter results reflect the continued benefits of the Travelers Transaction and the underlying momentum of the business. Gross written premiums increased 36.2%, driven by strong retention of the acquired renewal book and ongoing underlying growth contribution, keeping us on track to achieve our full-year gross written premium target of $6.5 billion. We recently reached an important integration milestone with the conversion process for all acquired product lines now underway. While catastrophe losses contributed 12.8 percentage points to our combined ratio during the quarter, the underlying performance of the business remained strong, demonstrating the benefits of increased scale, diversification, and disciplined underwriting. We remain focused on delivering our 2026 financial targets."
-- Rowan Saunders, President & CEO
"We continued to make meaningful progress against our integration objectives during the quarter. Run-rate synergies increased to $56 million and contributed $14 million to earnings in Q3 2026, reflecting continued realization of integration benefits. We remain on track to earn at least one-third of our revised $125 million annual run-rate synergy objective during 2026. Year-to-date performance across our investment portfolio and national broker platform supports our outlook for at least $320 million of net investment income and approximately 20% broker operating income growth for the full year. Our financial position remains strong, with financial capacity of approximately $1.2 billion at quarter end. The resilience of our business combined with the strength of our diversified earnings streams provides significant flexibility to support profitable growth, strategic investments, and disciplined capital deployment."
-- Philip Mather, EVP & CFO
Consolidated Results
(in millions of Q3 2026 Q3 2025 Change 2026 YTD 2025 YTD Change
dollars, except as
otherwise noted)
Insurance revenue 1,801.2 1,183.6 52.2 % 5,418.8 3,457.6 56.7 %
Gross written
premiums(1) 1,672.7 1,228.5 36.2 % 4,868.6 3,596.0 35.4 %
Net underwriting
revenue(1) 1,483.6 1,074.1 38.1 % 4,343.2 3,124.7 39.0 %
Claims ratio(1) 71.9 % 60.2 % 11.7 pts 66.2 % 62.5 % 3.7 pts
Expense ratio(1) 28.7 % 29.2 % (0.5) pts 29.7 % 29.7 % - pts
Combined ratio(1) 100.6 % 89.4 % 11.2 pts 95.9 % 92.2 % 3.7 pts
(in millions of Q3 2026 Q3 2025 Change 2026 YTD 2025 YTD Change
dollars, except as
otherwise noted)
Insurance service
result 67.0 168.2 (101.2) 445.2 435.8 9.4
Underwriting
(loss) income(1) (8.8) 113.6 (122.4) 179.6 243.2 (63.6)
Net investment
income 79.3 54.1 25.2 238.7 154.6 84.1
Distribution
income(1) 18.7 18.2 0.5 54.4 51.1 3.3
Net (loss) income
attributable to
common
shareholders (32.4) 193.1 (225.5) 183.9 360.2 (176.3)
Operating net
income(1) 43.9 125.2 (81.3) 280.0 300.0 (20.0)
Per share measures
(in dollars)
Diluted (loss)
earnings per
share (0.27) 1.59 (117.0 %) 1.51 3.05 (50.5 %)
Operating earnings
per share(1) 0.36 1.03 (65.0 %) 2.30 2.54 (9.4 %)
Book value per
share(1) 34.53 33.43 3.3 %
Return on equity
Return on equity
("ROE")(1) 5.9 % 14.0 % (8.1) pts
Operating ROE(1) 10.3 % 12.5 % (2.2) pts
(1) This is a supplementary financial measure, non-GAAP
financial measure, or a non-GAAP ratio. Refer to Supplementary
financial measures and non-GAAP financial measures
and ratios in this news release, and Section 12 --
Supplementary financial measures and non-GAAP financial
measures and ratios in the Q3 2026 Management's Discussion
and Analysis dated November 5, 2026 for further details,
which is hereby incorporated by reference and is available
on the Company's website at www.definityfinancial.com
and on SEDAR+ at www.sedarplus.ca.
(2) Please refer to the Company's May 27, 2025 news release
announcing its agreement with St. Paul Fire and Marine
Insurance Company and Travelers Casualty and Surety
Company (collectively, "Travelers") to acquire Travelers'
Canadian P&C insurance operations, excluding its Canadian
surety business and certain select business lines
retained by Travelers, for cash consideration of approximately
$3.3 billion (the "Travelers Transaction").
(3) Underlying GWP growth contribution includes retention
of the Definity renewal book and all new business,
and is expressed as a percentage of reported 2025
GWP.
-- Gross written premiums ("GWP") for Q3 2026 increased by $444.2 million or
36.2% compared to Q3 2025, inclusive of 25.7% growth from the acquired
renewal book as retention rates continue to converge with the underlying
Definity business. Personal lines GWP were up 36.9%, driven by retention
of the acquired renewal book and strong underlying growth contribution.
Commercial lines GWP increased 34.2%, driven by retention of the acquired
renewal book, and ongoing pricing and volume increases in small business
and specialty lines. Year to date, GWP increased by approximately $1.3
billion or 35.4% compared to 2025. Personal lines GWP increased 36.3% and
commercial lines GWP increased 33.4%.
-- Underwriting loss for Q3 2026 was $8.8 million and the combined ratio was
100.6%. This compares to underwriting income of $113.6 million and a
combined ratio of 89.4% in Q3 2025. The combined ratio in Q3 2026 was
impacted by significant catastrophe losses of $190.0 million, which
amounted to 12.8 percentage points, compared to only $20.6 million or 1.9
percentage points in Q3 2025. Year to date, our underwriting income of
$179.6 million, a decrease of $63.6 million from 2025, led to a combined
ratio of 95.9% compared to 92.2% in 2025. The performance was driven by
the strength of our operations and initial capture of synergies, despite
the heightened level of catastrophe losses.
-- Net investment income was $79.3 million in Q3 2026 and $238.7 million
year to date, compared to $54.1 million in Q3 2025 and $154.6 million in
2025 year to date. The increase was driven by interest income generated
from the larger investment portfolio arising from the acquired business
and proactive trading into higher prevailing market yields.
-- Distribution income was $18.7 million in Q3 2026 and $54.4 million year
to date, compared to $18.2 million in Q3 2025 and $51.1 million in 2025
year to date. When combining distribution income and the impact of the
commission offset, broker operating income increased by $2.7 million in
Q3 2026 (10.2% increase) and $12.9 million year to date (17.6% increase).
The quarterly growth was moderated by a particularly strong Q3 2025
comparative, which benefitted from the timing of acquisitions.
Net (Loss) Income and Operating Net Income
-- Net loss attributable to common shareholders was $32.4 million in Q3 2026
compared to net income of $193.1 million in Q3 2025, driven by investment
valuation losses on bonds in a rising interest rate environment, lower
gains on common stocks, and an increase in catastrophe losses, partially
offset by an increase in net investment income and claims discounting
recoveries. Year to date, net income attributable to common shareholders
was $183.9 million compared to $360.2 million in 2025, driven by the same
factors that impacted the third quarter.
-- Operating net income was $43.9 million in Q3 2026 compared to $125.2
million in Q3 2025, driven by the increased catastrophe losses in Q3 2026
and higher interest expense, partially offset by an increase in net
investment income. Year to date, operating net income was $280.0 million
compared to $300.0 million in 2025.
-- Operating ROE was 10.3% for the twelve-month period ended September 30,
2026 compared to 12.5% for the twelve-month period ended September 30,
2025. The decrease in operating ROE was due to a combination of the
slight reduction in operating net income, driven by more elevated
catastrophe losses, and the significant growth in average adjusted
equity.
(1) This is a supplementary financial measure, non-GAAP
financial measure, or a non-GAAP ratio. Refer to Supplementary
financial measures and non-GAAP financial measures
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