(in Canadian dollars except as otherwise noted)

Highlights

Executive Messages

"The firm market conditions in personal insurance, continued favourable conditions overall in commercial insurance, and our strong broker proposition combined to generate significant growth as premiums increased 9.6% in the first quarter, adjusted for our exited line. We delivered a 94.5% combined ratio in the quarter, as proactive rate actions and continued expense efficiencies largely offset the impacts of an active winter season. Operating results were bolstered by a solid performance from our broker distribution platform, including $11 million of distribution income and a strong level of commission offset. I am pleased with the encouraging start to the year and am confident that we will deliver on our 2025 financial targets, while advancing our strategic objectives. We have repeatedly demonstrated the resilience of our organization and have great confidence in our ability to become a top five P&C insurer."

â?? Rowan Saunders, President & CEO

"We ended the first quarter with book value per share of $29.52, up 16.2% from a year ago, as we continue to deliver value to shareholders. Our efforts to diversify the profitability of the business in recent years were reflected in our solid net investment income and ongoing contributions from our broker distribution platform, both of which met our expectations for the first quarter. These results combined with solid underwriting income to generate an operating return on equity of 10.3% over the past 12 months, despite the significant increase in our equity base and the active catastrophe experience in 2024. We proactively positioned our investment portfolio during the quarter in advance of April tariff announcements, moving nearly $250 million out of common equities and into government bonds. This defensive posture has helped protect our portfolio in the current environment and further strengthens our financial capacity, which ended the first quarter at $1.8 billion. We are well positioned with the capabilities, performance, and balance sheet needed to manage through environments of increased uncertainty and volatility."

â?? Philip Mather, EVP & CFO

Consolidated Results 

 

Net Income and Operating Net Income

Line of Business Results

Personal Insurance

Commercial Insurance

Financial Position

Dividend

Normal Course Issuer Bid ("NCIB")

Conference Call

Definity will host a conference call to review information included in this news release and related matters at 11:00 a.m. ET on May 9, 2025. The conference call will be available simultaneously and in its entirety to all interested investors and the news media at www.definity.com. A transcript will be made available on Definity's website within two business days.

About Definity Financial Corporation

Definity Financial Corporation ("Definity", which includes its subsidiaries where the context so requires) is one of the leading property and casualty insurers in Canada, with over $4.5 billion in gross written premiums for the 12 months ended March 31, 2025 and approximately $3.4 billion in equity attributable to common shareholders as at March 31, 2025.

Cautionary Note Regarding Forward-Looking Information

This news release contains "forward-looking information" within the meaning of applicable securities laws in Canada. Forward-looking information may relate to our future business, financial outlook and anticipated events or results and may include information regarding our financial position, business strategy, growth strategies, addressable markets, budgets, operations, financial results, taxes, dividend policy, plans and objectives. Particularly, information regarding our expectations of future results, performance, achievements, prospects or opportunities or the markets in which we operate is forward-looking information. In some cases, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "aims", "targets", "expects" or "does not expect", "is expected", "an opportunity exists", "budget", "scheduled", "estimates", "forecasts", "projection", "prospects", "strategy", "intends", "anticipates", "does not anticipate", "believes", or variations of such words and phrases or statements that certain actions, events or results "can", "may", "could", "would", "might", "will", "will be taken", "occur" or "be achieved". In addition, any statements that refer to expectations, intentions, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts, but instead represent management's expectations, estimates and projections regarding possible future events or circumstances.

Forward-looking information in this news release is based on our opinions, estimates and assumptions in light of our experience and perception of historical trends, current conditions and expected future developments, as well as other factors that we currently believe are appropriate and reasonable in the circumstances. Despite a careful process to prepare and review the forward-looking information, there can be no assurance that the underlying opinions, estimates and assumptions will prove to be correct. Forward-looking information is necessarily based on a number of opinions, estimates and assumptions that we considered appropriate and reasonable as at the date such statements are made, and are subject to many factors that could cause our actual results, performance or achievements, or other future events or developments, to differ materially from those expressed or implied by the forward-looking statements, including, without limitation, the following factors:

If any of these risks or uncertainties materialize, or if the opinions, estimates or assumptions underlying the forward-looking information prove incorrect, actual results or future events might vary materially from those anticipated in the forward-looking information. The opinions, estimates or assumptions referred to above and described in greater detail in the "11 â?? Risk Management and Corporate Governance" section of the Management's Discussion and Analysis for the year ended December 31, 2024 should be considered carefully by readers.

Although we have attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, the factors above are not intended to represent a complete list and there may be other factors not currently known to us or that we currently believe are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking information. There can be no assurance that such forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information, which speaks only as at the date made. The forward-looking information contained in this news release represents our expectations as at the date of this news release (or as at the date they are otherwise stated to be made) and are subject to change after such date. However, we disclaim any intention or obligation or undertaking to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required under applicable securities laws in Canada.

All of the forward-looking information contained in this news release is expressly qualified by the foregoing cautionary statements.

Supplementary Financial Measures and Non-GAAP Financial Measures and Ratios

We measure and evaluate performance of our business using a number of financial measures. Among these measures are the "supplementary financial measures", "non-GAAP financial measures", and "non-GAAP ratios" (as such terms are defined under Canadian Securities Administrators' National Instrument 52-112 â?? Non-GAAP and Other Financial Measures Disclosure), and in each case are not standardized financial measures under GAAP. The supplementary financial measures, non-GAAP financial measures, and non-GAAP ratios in this news release may not be comparable to similar measures presented by other companies. These measures should not be considered in isolation or as a substitute for analysis of our financial information reported under GAAP. These measures are used by financial analysts and others in the P&C insurance industry and facilitate management's comparisons to our historical operating results in assessing our results and strategic and operational decision-making. For more information about these supplementary financial measures, non-GAAP financial measures, and non-GAAP ratios, including (where applicable) definitions and explanations of how these measures provide useful information, refer to Section 11 â?? Supplementary financial measures and non-GAAP financial measures and ratios in the Q1 2025 Management's Discussion and Analysis dated May 8, 2025, which is available on our website at www.definity.com and on SEDAR+ at www.sedarplus.ca.

Below are quantitative reconciliations of non-GAAP measures for the three months ended March 31, 2025 and 2024:

Net underwriting revenue

Net claims and adjustment expenses

Prior year claims development

Net underwriting expenses

Net commissions

Net operating expenses

Net premium taxes

Underwriting income                                                                                                                                                         

Operating net income, Operating income, Non-operating gains (losses)

Net income attributable to common shareholders is the most directly comparable GAAP financial measure disclosed in our interim consolidated financial statements to operating net income, operating income, and non-operating gains (losses), which are considered non-GAAP financial measures.

Distribution income

Below are quantitative reconciliations of non-GAAP ratios for the periods ended March 31, 2025 and 2024:

ROE

Operating ROE

SOURCE Definity Financial Corporation

SOURCE: Definity Financial Corporation

Contacts: Investor inquiries: Dennis Westfall, VP, Investor Relations, (C)
416-435-5568, dennis.westfall@definity.com; Media inquiries: Sarah Attwells, AVP,
Corporate Communication, (C) 226-753-1130, sarah.attwells@definity.com

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