Definity Financial Corporation

Latest Results (07.01.2026):

Definity Financial Corporation — third quarter of 2025: Definity reported solid Q3 2025 results with gross written premium growth, materially improved underwriting performance versus a year ago, and strong operating profitability ahead of the planned Travelers acquisition. Key metrics: GWP growth 7.5% YoY, combined ratio 89.4%, operating net income $125.2 million (operating EPS $1.03), net income $195.6 million (basic EPS $1.61), and book value per share $33.43 (up 24% YoY). The company continued to fund its announced ~$3.3 billion acquisition of Travelers’ Canadian P&C business with a mix of equity, debt and excess capital and has financing in place.

Premium growth

GWP rose 7.5% in Q3 2025 (7.7% YTD) with balanced gains across personal and commercial lines; Definity reported $1,228.5M GWP in the quarter (supplementary measure) and continued unit/rate gains in personal auto and property plus strong commercial retention and specialty expansion.

Underwriting performance & combined ratio

Underwriting income was $113.6M in Q3 2025 versus an underwriting loss a year earlier; the combined ratio improved to 89.4% (Q3 2024: 103.4%), driven largely by a much lower level of catastrophe losses and disciplined expense management (expense ratio 29.2%, claims ratio 60.2%).

Operating profitability

Operating net income was $125.2M in the quarter and operating EPS was a record $1.03; trailing 12‑month operating ROE rose to 12.5%, reflecting improved underwriting results and operating leverage.

Net income and EPS

Reported net income was $195.6M in Q3 2025; net income attributable to common shareholders was $193.1M (basic EPS $1.61, diluted $1.59), up materially versus Q3 2024 driven by underwriting gains despite lower realized gains on fair‑value investments.

Investments and non‑operating items

Net investment income in Q3 was $54.1M (interest income higher on increased bond holdings), while recognized gains on FVTPL investments declined to $95.5M (Q3 2024: $172.8M), contributing to lower non‑operating gains year‑over‑year; management expects net investment income > $210M for 2025.

Travelers acquisition and financing

Definity reaffirmed the ~$3.3B acquisition of Travelers’ Canadian P&C business (announced May 27, 2025) and expects closing in Q1 2026 (targeted early 2026). Financing completed or secured includes equity placements (June 2025), a $1.0B private placement of senior notes (Sept 12, 2025), and syndicated bank facilities to fund the transaction and manage excess capital.

Claims, catastrophes and prior‑year development

The core accident year claims ratio was broadly stable; Q3 catastrophe losses were unusually benign versus Q3 2024 (leading to the combined ratio improvement). Prior‑year favourable development continued but at a somewhat lower run‑rate vs. the prior year.

Capital, book value and distribution platform

Book value per share was $33.43 (up 24% YoY). Distribution income rose (Q3 $18.2M; YTD $51.1M) as broker acquisitions continued (≈$163M of broker purchases YTD) and the company expects the Travelers deal to materially increase scale, broker channel presence and medium‑term returns.