Definity Financial (DFY) National Bank Financial 23rd Annual Canadian Financial Services Conference summary

Business performance and market environment

• Strong momentum from 2023 has continued into 2024, with a stable Canadian winter and no major surprises in Q1.

• Competitive position in the marketplace is improving, supported by strong broker relationships.

• Auto market remains firm with sizable industry rate changes, supporting future competitiveness.

• Commercial market remains constructive, with pricing ahead of loss cost trends.

Impact of tariffs and trade environment

• As a Canadian-only business, direct impact from US tariffs is limited, but secondary economic effects are being monitored.

• Less than 15% of claims could be affected by tariffs, mainly in auto, and this is considered manageable.

• Mitigating actions include use of substitute products, alternative parts, and proactive pricing adjustments.

• Investment portfolio has been adjusted, including equity sales, to strengthen financial positioning.

Pricing and market conditions

• Recent proactive price increases in auto and a pause on reducing indexation in property to address inflation uncertainty.

• Hard market conditions are expected to persist due to inflationary pressures from tariffs.

• Indexation factors in property have been maintained to hedge against potential inflation.