Sagicor Financial Company reported a sharp increase in core profitability for 2025, beating its own guidance on earnings and new business value.
Core earnings to shareholders for 2025 rose 57% year-over-year to $142.3 million, and above the revised guidance range of $120 million to $130 million. Core basic EPS increased 62% to 104.9 cents from 64.9 cents a year earlier. Core return on shareholders’ equity (ROE) improved to 14.2%, from 9.6% a year earlier.
Fourth‑quarter 2025 core earnings to shareholders were $31.6 million, up 13% from $28.0 million in Q4 2024, with core basic EPS of 23.3 cents, up 14% year over year.
Total comprehensive income to shareholders for 2025 was $109.7 million.
New business contractual service margin, or CSM, was s$167.2 million for the year, broadly flat on 2024's $166.3 million, but within the guided range of $155 million to $175 million. In Q4, new business CSM was $41.3 million, up from $39.3 million a year ago.
Chief executive officer Andre Mousseau said full‑year core earnings “reflected achievement of our medium‑term targets amplified by approximately $15 million of positive gains from core insurance experience and gains from short‑term business.”
Shareholders’ equity at Dec. 31, 2025 was $1.04 billion, up 8% from $959.7 million a year earlier. Book value per share rose to $7.65 (C$10.49), an 8% increase in US dollar terms and 3% in Canadian dollars.
Net CSM to shareholders ended the year at $1.12 billion, up 4% from $1.08 billion. On a combined basis, shareholders’ equity plus net CSM to shareholders totaled $2.16 billion, up 6% from $2.04 billion, equivalent to $15.95 (C$21.87) per share.
The group LICAT ratio stood at 136%, slightly down from 139% in 2024 but still comfortably above regulatory minimums. The financial leverage ratio edged lower to 26.9% from 27.3%.
Management described the capital position as consistent with supporting growth in North America and the planned reorganization of its Caribbean business, while maintaining room for dividend increases.
Sagicor said it made “significant progress” on strategic initiatives in the fourth quarter, led by a definitive agreement to merge its two Caribbean operating segments into a single publicly listed entity, to be named Sagicor Group Caribbean Limited.
The company said the combination is expected to support a broader digital transformation in the Caribbean, while its North American segments continue to focus on organic growth in life, health and annuity lines.
On the back of the 2025 result, Sagicor updated its core ROE guidance. It now targets a 14% core ROE in 2027 and 15% over the medium term, and a core dividend payout ratio of 30% to 40%, assuming current business and market conditions.
Measured against the large Canadian‑listed life insurers, Sagicor operates at a much smaller absolute scale but is now producing core returns moving into the same broad range as its bigger peers.
Manulife Financial has reported record core earnings in recent years, with annual core profit in the multi‑billion‑dollar range and core ROE in the mid‑teens, supported by Asia and global wealth and asset management. Sun Life has also posted high‑single‑digit to double‑digit underlying earnings growth and an underlying ROE around the high‑teens, driven by asset management, wealth, health and protection businesses. Great‑West Lifeco, parent of Canada Life, has delivered record base earnings with base ROE above 17% and a consolidated LICAT ratio around the low‑130s.
By comparison, Sagicor’s 2025 core earnings to shareholders of $142.3 million and core ROE of 14.2% are much smaller in dollar terms, reflecting its regional footprint across the Caribbean and North America. However, its return level is now approaching that mid‑teens band targeted by the larger groups. The group LICAT ratio of 136% is in line with, or slightly ahead of, the consolidated LICAT levels disclosed by some of the large Canadian lifecos, indicating similar solvency headroom despite Sagicor running with a higher financial leverage ratio of 26.9%.
Where Sagicor diverges most from the big three is business mix. Manulife, Sun Life and Great‑West Lifeco all derive significant portions of earnings from global asset and wealth management businesses with trillions of client assets, alongside their insurance operations. Sagicor remains more concentrated in life, health, annuities and related insurance in the Caribbean and North America, with IFRS 17 CSM and new business metrics playing a larger role in its growth narrative.
In that context, Sagicor’s record new business CSM of $167.2 million and its stepped‑up 15% medium‑term core ROE target will be watched as indicators of how a mid‑tier regional player can scale under IFRS 17 alongside much larger Canadian peers.
Sagicor’s board of directors recently approved a quarterly dividend of 7.5 cents per common share, an 11% increase from the prior quarterly dividend of 6.75 cents per share. The dividend is payable on April 17, to shareholders of record at the close of business on March 26.
Sagicor's 2025 numbers indicate that the company has moved more quickly than expected towards its initial core earnings and ROE ambitions, while keeping LICAT above 130% and financial leverage below 30%. How effectively it executes the Caribbean segment merger and delivers on its 2027–2028 core ROE targets will shape how it is viewed alongside larger Canadian and regional competitors in the coming years.
