Intact Financial Corporation

Good morning, ladies and gentlemen, and welcome to the Intact Financial Corporation Q2 2026 Results Conference Call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. And if at any time during this call you require needed assistance, please press star zero for the operator. Also note that this call is being recorded on July 29, 2026. And I would like to turn the conference over to Geoff Kwan, Chief Investor Relations Officer. Please go ahead, sir.

Thank you, Sylvie. Hello, everyone, and thank you for joining the call to discuss our second quarter financial results. A link to our live webcast and materials for this call have been posted on our website at impactfc.com under the Investors tab. Before we start, please refer to slide two for a disclaimer regarding the use of forward-looking statements, which form part of this morning's remarks. and Slide 3 for a note on the use of non-GAAP financial measures and other terms used in this presentation. To discuss our results today, I have with me our CEO, Charles Brindamour, our CFO, Kenneth Anderson, Patrick Barbeau, our Chief Administrator, and Afraf Louitry, our Senior Vice President for Skull Lions. We will begin with a pair of remarks followed by Q&A, and with that, I will turn the call over to Charles.

Thanks, Geoff. Welcome, Ashraf, to your first earnings call. Good morning, everyone, and thanks for joining us. Last night, we released our second quarter results. We generated net operating income per share of $3.17, driven by a combined ratio of 94.9, which included approximately four points of excess catastrophes and large losses. Our top line grew 4% in the quarter driven by continued strength in personal lines. Our ROE was in the upper teens at 17%. Our book value per share grew 13% year over year to $111.73. And our balance sheet is very strong with $3.7 billion of excess capital and that positions us well in an attractive M&A environment. Now this quarter was marked by a higher level of large losses than we've experienced historically and then we expected. Given that, we conducted a detailed and thorough review. We did not find any common driver or systemic pattern. We view what happened in Q2 as an anomaly and we're confident that the underlying performance and the fundamentals of our business are very strong. Let me now provide some color on each of our segments, beginning with Canada. In personal auto, premiums grew 9% in the quarter, including 1% of unit growth. This reflects sustained hard market conditions supported by our investments in marketing and in the digital channel. With the industry remaining unprofitable still at the end of Q1 2026, we expect industry premium growth to remain in the high single digits over the next 12 months. Our combined ratio in personal auto improved 1.5 points year over year to 88.8%, a strong result in a seasonally favorable quarter. This performance was driven by an improvement in the current accident tier of more than two points. On the reform front, we're encouraged by developments in both Ontario and Alberta. In Ontario, while early, customers are choosing the optional protection, which should help support growth. In Alberta, We like the direction being set for 2027. We'll provide an update later this fall as the reform package is finalized. But in both cases, we think these reforms are excellent for consumers and support a healthy and competitive automobile industry. They should also contribute to bring the industry closer to a more sustainable performance level. In personal property, premiums grew 7%, including a 1% increase in units. We see continued strength in this segment. We expect industry premium growth to be in the upper single to low double-digit range over the next 12 months. A combined ratio of 103 included 22 points of cap losses in the quarters. This is a reminder of the impact on industry profitability from severe weather events. We believe this will contribute to sustaining hard market conditions. Despite the elevated level of catastrophes in Q2, our year-to-date combined ratio of 93.9% shows our personal property business is positioned to deliver a sub-95 performance, even with severe weather. We view this segment as very attractive and a solid source of growth. Our track record of close to 90% combined ratio over 5 and 10 years is quite strong and gives us confidence in our growth strategy in that segment. In commercial lines, premium growth was 1% in the quarter. We see continued traction for our growth initiatives, which drove roughly three points of growth This was partially upset by two points of mixed shift towards smaller account sizes as we remain selective in the competitive large account space. I am encouraged not only by the strength of the SME portfolio, but also by sequential improvements in production stats in the mid-market space. We expect industry growth in the low to mid-single digits over the next 12 months. The combined ratio was strong at 85.7% in commercial. This result reflects our continued discipline in applying pricing sophistication and advanced risk selection techniques to retain higher quality accounts. We continue to expect a combined ratio of the low 90s or better. Moving now to our UK and high segment. Our top line decreased by 1% in the quarter. While growth was solid in specialty lines, our domestic UK commercial lines business saw pressure driven by the consolidation of products following the NIG acquisition into one impact value proposition. We continue to expect top line to improve in 2026 as we complete this exercise. And we expect the industry premium growth in the low to mid single digit range over the next 12 months. The combined ratio of 112% included 15 points of excess capital and large losses. And we're committed and confident in bringing the combined ratio towards 90%. We're making good progress and expect further improvements as we continue to roll out our pricing sophistication tools and also improve the expense ratio over time. In the U.S., premiums increased by 4%, driven by solid new business and strong growth in some of our most profitable verticals. Our top-line growth is benefiting from the wider product lineup and continued gains in expanding and deepening broker relationships. At the industry level, we expect premium growth to be in the mid-single digit over the next 12 months. The combined ratio of 85% in the U.S. this quarter improved nearly 3 points year over year, reflecting the benefits of our strategy of focusing on profitable growth. This marks our 12th consecutive quarter with a combined ratio below 90%. As we look ahead across all of our lines of business, we're operating in an environment that plays to our strengths. where pricing, sophistication, and risk selection are paramount. We significantly expanded our ROE outperformance in 2025 to 740 basis points as we continue to execute on our strategic roadmap. That includes investments in VLAN AI as well as leveraging our scale to build an extensive supply chain network That allows us to internalize over 95% of our claims globally. On the AI front, for instance, this includes realizing recurring benefits from investments faster than expected. Indeed, while our initiatives generate north of 220 million recurring benefits today, we now expect to achieve $500 million in benefits in 2028. Roughly two years earlier than we previously announced. On the claims side, the recent catastrophes in Canada illustrated our competitive advantage. In June, there were five catastrophes. Our advanced claims and outtakes capabilities and in-house restoration business on-site were instrumental in helping us close 47% of the almost 9,000 claims from June 10. An impressive result. It demonstrates how we're able to get our customers back on track faster while building a loss ratio advantage. We also remain focused on helping build more resilient communities. Initiatives like the Keep It Intact prevention ecosystems are driving proactive risk mitigation. Since the launch of the initiative last year, Our customers have recorded over 140,000 prevention actions in our rafts, which help them better protect their homes. These actions also enhance the resilience of our personal property portfolio. And on top of that, Jiffy, Canada's number one home maintenance hat, and only owned by Intact, is well positioned to benefit from increased prevention activity by homeowners. JP's revenues increased 24% year over year. So in closing, although Q2 was a difficult quarter for many of our customers, our teams continued to do outstanding work getting impacted customers back on track as fast as possible. I want to thank all our employees for their dedication to living our values and delivering for our customers. Our track record demonstrates that external factors, such as natural disasters and industry pricing cycles, didn't impact our ability to consistently deliver on our two financial objectives. With our net operating income per share growing at a compounded growth rate of 16% over the last three years and 12% over the last 10 years, we've exceeded our goal of at least 10% growth annually over time. Vote near and long term. Our average ROE outperformance has been 600 basis points over the last three years and almost 700 basis points over the last 10 years, well above our objective of at least 500 basis points outperformance. Given the environment in which we operate, our focus on outperformance, and our commitment to profitable growth, there's no doubt in my mind that we'll exceed our financial objectives in the next decade as we have in the last decade. Thank you, and now I'll turn the call over to our CFO, Ken Anderson.