Manulife Financial Corp. said Monday the impact of the earthquake and tsunami in Japan should be less than $150-million, after investors sold the shares off by 3.5 per cent on concerns about the insurer's exposure to the disaster.
Manulife, which is Canada's biggest life insurer, said in a statement that the earnings hit would be due to property and casualty reinsurance claims.
The Toronto-based company has a substantial Asian insurance and wealth management presence. It had insurance sales of $563-million (U.S.) in Japan in 2010, according to financial statements.
It also said it had confirmed the safety of all of its employees and agents in the country.
CIBC World Markets analyst Robert Sedran said in an email the situation in Japan was having an impact on the stock, as Manulife is the only Canadian insurer with direct exposure to the country.
Mr. Sedran also said that the insurer was facing pressure from weaker share prices and bond yields, which lower actuarial projections on Manulife's portfolio of investments and force the company to hold more funds in reserve for future obligations.
The Toronto Stock Exchange's S&P/TSX composite index ended the session down 0.4 per cent, recovering late from a steeper drop, on the back of worries about the impact of the situation in Japan.
The Canadian 10-year bond also eased Monday.
Sun Life Financial spokesman Frank Switzer said the company, Canada's No. 3 insurer, had no exposure to the crisis.