Skip to main content

Allen Loney, president and CEO of Great West Lifeco, in May, 2008.Jim Ross/The Canadian Press

Great-West Lifeco Inc. says its third-quarter earnings grew 14 per cent as sales picked up across most of its segments, including insurance and investment products.

"We had a really strong bottom line result in Q3 2012 and we're taking advantage of our broad distribution channels on leading product design to win new business, which should lead to strong future earnings," said CEO Allen Loney on a conference call with analysts.

The Winnipeg-based insurer says profits attributable to shareholders grew to $520-million, or 55 cents per share, compared with $457-million, or 48 cents per share, in the same period of 2011.

That beat the average estimate of 51 cents per share, according to analysts polled by Thomson Reuters.

Canada contributed more than half of the company's overall profit, with $281-million of net earnings attributable to common shareholders, up from $235-million in the third quarter of 2011.

Great-West's U.S. operations contributed $87-million of net earnings, up from $75-million a year earlier, while Europe accounted for $165-million of net earnings, up from $148-million.

Premiums and deposits grew 8 per cent to $15.5-million during the quarter.

The company's return on equity was 17.1 per cent based on net earnings, up from 16.7 per cent a year ago.

Great-West's indirect subsidiary, London Reinsurance Group, is tallying the impact of superstorm Sandy, which devastated parts of the U.S. Eastern Seaboard last week.

London Reinsurance provides property catastrophe coverage to reinsurance companies.

Reinsurance companies write backup insurance for primary insurers so that the insurance industry can cover catastrophic claims, like those resulting from natural disasters. The impact on the companies depend on many factors, such as how much of the damage was insured by them and how much they charged for coverage.

Total insured industry losses from Sandy are estimated to be between $7-billion and $20-billion, said Arshil Jamal, president and chief operating officer of Great-West's Europe division.

"While the company does not expect to receive formal claims notifications for some period of time, the company estimates claim payment obligation of between $10-million and $25-million," Mr. Jamal said.

Sandy has killed more than 100 people in 10 states, most of whom were in New York and New Jersey.

Some have pegged Sandy's overall toll at up to $50-billion, making it the second-most expensive storm in U.S. history. Hurricane Katrina cost $108-billion and caused 1,200 deaths in 2005.

Great-West shares rose 9 cents to $22.91 on the Toronto Stock Exchange Thursday.