Intact Financial Corporation

Fourth-quarter net operating income per share was $5.50, up 12% year over year, and full-year net operating income per share was $19.21, up 33%. Q4 combined ratio was 85.9%, improving 0.6 points year over year, while the full-year combined ratio was 88.2%, a 4-point improvement. Operating ROE was 19.5% over the past 12 months, and book value per share increased 16% to $107.35. Underlying current accident year loss ratio improved to 55.9% in Q4, and favorable prior-year development was 5.5%. Catastrophe losses were $69 million in Q4 and $844 million for the full year. The consolidated expense ratio was 34.4% in Q4 and 34.0% for the full year. Looking ahead, management expects 2026 investment income to be more than $1.6 billion, annual catastrophe losses of $1.2 billion, and expense ratio guidance of 33% to 34%. The quarterly dividend was increased 11% to $1.47.

Charles Brindamour framed the quarter as evidence that Intact’s model continues to compound through organic growth, margin expansion, and capital deployment. He highlighted ongoing outperformance in Personal lines, Commercial lines, UK&I, and U.S. Specialty, and said the company’s AI investments are already producing more than $200 million of recurring benefits, on track to exceed a $0.5 billion ambition by 2030. His tone was confident and strategic, with repeated emphasis on a larger opportunity set, durable ROE in the upper teens, and continued double-digit NOI per share growth over time.

Ken Anderson emphasized the quality of earnings and margin progression, pointing to the 85.9% Q4 combined ratio, 55.9% underlying current accident year loss ratio, and 5.5% favorable prior-year development. He noted catastrophe losses of $69 million in the quarter and $844 million for the year, while keeping 2026 catastrophe expectations at $1.2 billion. He also called out a 34.4% Q4 expense ratio, $415 million of operating net investment income in the quarter, expected 2026 investment income above $1.6 billion, total capital margin of $3.7 billion, and an adjusted debt-to-total-capital ratio of 16.5%. He said $200 million was spent on buybacks over the last 6 months and that the company is maintaining dry powder for M&A while continuing to buy back shares opportunistically.

Analysts pressed management on whether AI could disrupt insurance manufacturing and distribution the way it affected the U.K. market, and management said the brand, claims capability, and direct/broker optionality in North America make the situation different, though search and digital-channel positioning will matter more over time. Questions also focused on competition in large commercial accounts, the persistence of a hard personal auto market, the flat general expense ratio, ROE targets, and why premium-growth guidance has moderated while industry ROE expectations remain around 10%. Management replied that personal auto remains unprofitable industry-wide, competition is uneven and more intense in large accounts than SME/mid-market, and the expense ratio is being held back by growth mix, technology investment, and variable compensation tied to profitability. On capital, management said the balance sheet is underlevered, deployable capital is substantial, and M&A remains a live priority alongside buybacks.