Fairfax recently announced its best underwriting results in their 30-year history with USD 705 million in Underwriting Profit compared to the USD 552 million that was recorded in 2014, and a record combined ratio of 89.9%. They earned USD 568 million after tax (USD 23.15 per share) in 2015, thereby increasing common shareholders’ equity from USD 8.4 billion as at December 31, 2014 to USD 9.0 billion.
Fairfax Financial who hold a 78% stake in Union Assurance General Limited (UAG) is one of the largest providers of general insurance in the world. A diversified, financial services company headquartered in Toronto and listed on the Toronto stock exchange, Fairfax accounts years of experience in insurance, re-insurance and other financial services across the globe and have been a majority stakeholder of UAG since January 2015.
Chairman & Chief Executive Officer of Fairfax Mr. Prem Watsa had stated in his letter to shareholders “We think of business as a good thing. By providing outstanding service to customers, looking after and nurturing employees, providing a return for shareholders and then reinvesting a portion of the profits in the communities we serve, we think business can be a calling. The key, we think, is to be focused on the long term and never compromise honesty and integrity in any relationship. Our Guiding Principles have served us well over the past 30 years and are the rock on which our company is built. They will never change!”
The compound growth rate of the Fairfax stock price over 30 years is the second best among all companies in Canada and among the top ten companies in the S&P500 stock market index. Soundly financed with year-end cash and marketable securities close to USD 1.3 billion as at 31st December 2015, the Net premiums written by its insurance and reinsurance operations increased by 16.6% to USD 7,138.9 million, primarily reflecting the consolidation of Brit Insurance – one of the largest insurers in UK, in the second quarter of 2015.
UAG recently held its first Annual General Meeting under the patronage of Fairfax, together with the newly appointed Board of Directors and the Chairman of Fairfax Asia Mr. Ramaswamy Athappan. “We are proud to be a part of the Fairfax Group. Their backing and expertise continues to be a source of confidence for UAG during this transitionary period” stated Dr. Sanjeev Jha the CEO. He further stated “The insurance market here in Sri Lanka is at an exciting point of time. With the country’s economy showing signs of development & opportunities surfacing we see immense scope for growth in the market. Being a part of Fairfax allows us to leverage on global capabilities and take our company to greater heights”
Sources: 2015 Fairfax Annual Report – Shareholder letter & Press Release on Fairfax Financial Holdings Limited: Financial Results for the Year Ended December 31, 2015.
Photo caption: CEO & Director Board of Union Assurance General (From the left) Director- Mr. Anushka Wijesingha, Director -Mr. Ratnaswami Chandran, Chairman – Mr. Ramaswami Athappan, CEO – Dr. Sanjeev Jha, Director – Mr. Cedric Wijegunawardane, Director – Mr. Sanjiv Malhotra & Director – Mr. Dirk Pereira