President's Report 2019
On behalf of the Board of Directors, I am pleased to report that we had another successful year. Premiums were up by $2.2 million and over 1,200 new policies were added to our book of business.
This increase and the addition to our surplus in 2019 allows PEI Mutual, the only Island owned insurance company, to surpass our minimum requirements of the P.E.I. Insurance Act.
Our operating expense ratio continues to be on the low side of our expectations, coming in at 31.5%. This is due to our hardworking staff, management and agency force which together keep our costs in line.
While we did have a sound year financially we were also exposed to the largest single one time loss in our Company?s history. Hurricane Dorian blew through in a day and left a large path of destruction in its wake. The Company had to handle and process over 2,000 claims with a total estimated loss at the end of 2019 at about $8 million, including twelve large hurricane losses, each over $50,000.
Thankfully, our Catastrophe Treaty with Farm Mutual Re (FMRe), our reinsurer, provided coverage for financial exposure in excess of $1.65 million. Fire continues to be our largest primary loss again this year with a total loss of $ 5.9 million. Once again, electrical systems cause a high percentage of these losses.
On a more positive note, we would like to advise that we will again this year offer a 10% mutual rebate, which will be credited to your premium at time of renewal.
I would like to remind all of our policyholders that P.E.I. Mutual is the only Island owned insurance company on PEI and because of that, the staff, agents, management and directors take great pride in striving to keep this 135 year old company successful.