Intact Financial (IFC) investor relations material

Strategic priorities and financial objectives

• Focus remains on outperforming industry ROE by at least 500 basis points and compounding net operating income per share at 10%+ annually, with historical outperformance in both metrics over 5, 10, and 15 years.

• Growth strategy centers on top-line expansion, margin improvement via pricing and claims management, and accretive capital deployment, especially through M&A.

• Organic growth targets include increasing Canadian premiums from CAD 17B to CAD 25B and specialty lines from CAD 7B to CAD 10B by 2030, while maintaining strong combined ratios.

• M&A remains a key lever, with over CAD 10B deployed in the past decade and a focus on Canadian and U.S. specialty markets.

• Current balance sheet allows for up to CAD 6B in new M&A without raising equity, with additional capacity if needed.

Market conditions and business mix

• Nearly half of premiums are Canadian personal lines, currently benefiting from hard market conditions in both auto and property, supporting double-digit growth.

• Commercial and specialty lines (50-55% of business) face more competition in large accounts but remain strong in SME and mid-market segments, which make up 70% of the portfolio.

• Use of advanced risk-based underwriting enables selective retention and growth, especially in competitive large account spaces.

• Non-rate growth levers include broker distribution, exporting verticals, and MGA investments, with over CAD 1.5B in MGA premium volume and 60% on balance sheet.

• Specialty lines aim to maintain sub-90 combined ratios, shrinking in underpriced segments while expanding in profitable ones.

Technology and AI deployment

• Over a decade of AI investment, with 600+ staff and 600 models in production, primarily focused on pricing and claims.

• AI strategy has four pillars: pricing/loss ratio improvement, customer/broker experience, software development productivity, and operational efficiency.

• AI-driven productivity gains include a 10% annual lift in software development output and targeted CAD 500M in recurring annual benefits by 2028.

• Advanced broker technology in commercial lines has increased quote and bind volumes significantly.

• AI supports early trend detection in auto insurance, aiding proactive pricing and risk management.