02:23 PM EDT, 08/22/2024 (MT Newswires) -- National Bank currently estimates ~12 percentage points of catastrophe loss impact in the third quarter for Definity Financial ( DFYFF ), which translates to ~$122 million, compared with Intact Financial's estimated 21 percentage points of catastrophe loss impact (and $1.1 billion).

While Definity has yet to release a QTD estimate, analyst Jaeme Gloyn expects a challenging but "somewhat" less intense result due to market share and more attractive reinsurance agreements.

Unlike Intact, Definity is far less exposed to Quebec, where Hurricane Debby potentially resulted in a $1 billion loss. Intact holds a 26% market share in Quebec, to Definity's 2%.

Definity also benefits from aggregate reinsurance treaty that provides an incremental $25 million of coverage. This coverage activates after Definity faces multiple catastrophe events in one year. "It's likely this aggregate reinsurance coverage is activated in Q3 to further mitigate losses from an otherwise challenging catastrophe quarter," Gloyn adds.

Definity is rated Outperform, with a $62 target.

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