ING Canada Inc., the country's largest provider of property and casualty insurance, is looking for more acquisitions after its 2005 results were boosted by the purchase of Allianz Insurance Co. of Canada.

"There is considerable room in the industry for further consolidation," CEO Claude Dussault said during the company's annual meeting Monday.

"As part of our medium- and long-term growth plan, we intend to be an acquirer and play a role in the consolidation process, to the extent that it creates value for our shareholders."

With the 2004 acquisition of Allianz, ING Canada solidified its leading share of the property and casualty market.

ING's average premium growth has been 13.5 per cent per year since 1995, almost twice the industry average of seven per cent.

The Canadian property and casualty insurance subsidiary of Dutch financial conglomerate ING Groep, offering automobile, property and liability insurance to individuals and businesses through its insurance subsidiaries, also purchased Ontario-based Grey Power Insurance Brokers Inc., the largest company in the Grey Power insurance network in April.

The mix of acquisitions and organic growth, Dussault said, is key to the company's goal of outpacing growth in the competitive insurance industry.

Dussault also said overall industry returns are expected to be below 2005 levels this year, but above average historical levels.

And ING is holding out hope for lower auto insurance premiums industrywide in 2006, because of the impact of regulatory reforms.

"While overall premiums declined, regulator reforms have succeeded in stabilizing costs," he said. "We believe the low frequency rate that we have experienced will either increase or, if not, will lead to further rate reductions."

The continued profitability of automobile insurance was one of the key drivers of ING's underwriting results in 2005.

ING Canada had reported a full-year net income of $781.8 million or $5.85 per share, up 25.2 per cent from $624.2 million or $4.66 per share in 2004 — boosted by a continued strength in underwriting profit and investment results.

Annual revenue for the firm's first full year as a public company rose to $4.4 billion from $3.8 billion after the acquisition of Allianz Canada in 2004.

That has led the company to raise its quarterly dividend to 25 cents per share from 16.5 cents.

On the Toronto stock market early Monday, ING Canada shares were trading down 67 cents at $59.52.

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ROMINA MAURINO
CANADIAN PRESS

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