RSA Announces Strong Year End Results

February 25, 2010 – Leading home, car and business insurer RSA Canada, today announced another strong year with premium growth of 5% and a COR of 93.5% despite challenging market conditions and adverse weather.

Group

The RSA Group has once again delivered a strong performance with net written premium growth of 4% to £6.7bn.  The combined operating ratio was 94.6% and the underwriting result was up by 1% to £386m. A continued focus on sustainable profitable performance has delivered a positive underwriting result in all regions.

Canada

In Canada, premiums were up 5% on prior year to $1,817m driven by organic growth and acquisition activity. Underwriting profit was $112m and COR was 93.5% despite tough economic conditions, a significant increase in weather losses, and regulatory uncertainty in the auto market. The result reflects continued underwriting discipline in challenging market conditions, and the organization’s strong segmented strategic focus. 

“RSA has delivered another strong result in 2009. We continue to drive the business forward through targeted acquisitions, with five completed in 2009, and through organic growth. We continue to outperform the market in very difficult economic conditions. We have the right segmented and specialist strategy in place and I’m confident that we’ll continue to drive sustainable profitable growth in 2010,” says Rowan Saunders, President & CEO.

Simon Lee, CEO, International commented, “Canada played a significant role in the success of International which has again delivered an outstanding performance and continues to drive the Group forward. Our focus on rate and risk selection has ensured that we remain one of the most profitable insurers in Canada.”

In Commercial Lines, premiums were up 2% to $433m with a COR of 87.5% in a highly competitive market.  RSA is reporting significant growth in Mid-Market, particularly Construction & Contracting and the Renewables portfolio. Global Risk Solutions is making strong progress in building a sustainable global and risk managed business and is already reporting impressive growth of 28%. 

In Personal Lines, including Johnson Inc., premiums were up 6% to $1,385m with a COR of 95.3%. 2009 was the worst year on record for weather losses, and in parallel to the rest of the industry, the impact was felt on the personal property book. Results were achieved due to positive rate actions taken and high retention rates.

The strong result also reflects the continued impact of favourable positive claims development reflecting prudent reserving and includes the release of a provision associated with minor injury cap reforms which had a positive impact on underwriting income.

Canada is a key contributor to the Group’s success, representing 31% of International, one of the three regions that make up the RSA Group.

About RSA

RSA Canada includes Roins Financial Services Limited, Royal & Sun Alliance Insurance Company of Canada, Quebec Assurance Company, Johnson Inc., Western Assurance Company, Ascentus Insurance Ltd., Canadian Northern Shield Insurance Company and is part of RSA Insurance Group plc. RSA Canada employs approximately 3,200 people and is represented by a large network of brokers across the country. In 2009, the Canadian Group wrote $1.9bn in direct premiums with assets exceeding $5.5 billion. Internationally, RSA Insurance Group plc employs about 21,000 people and has the capability to write business in 130 countries and in 2009 its net written premiums were £6.7bn.

RSA and CNS are trade names of Royal & Sun Alliance Insurance Company of Canada and Canadian Northern Shield Insurance Company, respectively.

Notes to editors:
Exchange rates
 

Local currency/£	12 Months 2009			12 Months 2008
	Average	Closing		Average	Closing
Canadian Dollar	1.78	1.69		1.96	1.77

* Figures are prepared in accordance with IFRS.

For more information contact:
Christine Siemiernik
Communications Consultant - RSA
Christine.Siemiernik@rsagroup.ca
416-366-7600 ext. 2423
cell: 416-274-1448