COVID-19 has caused trouble for Great-West Lifeco Inc., which saw its first-quarter net earnings plunge by almost 50 per cent compared with a year ago.

The Winnipeg-based insurer said it has been negatively impacted by global financial markets that have fallen amid the pandemic and caused the company to continue to experience significant volatility.

"There is still much uncertainty ahead as countries and economics gradually re-open," said Paul Mahon, the company's president and CEO, on a Thursday afternoon earnings call.

"It will take discipline, adaptability and creativity to manage the way forward."

Increases in insurance contract liabilities in response to lower equity markets, segregated fund guarantees and related hedging ineffectiveness, lower fee income and unrealized losses on seed capital hurt its quarterly earnings by about $300 million.

Great-West said in its quarter ended on Mar. 31 its net earnings attributable to common shareholders fell to $342 million or 37 cents per share from $657 million or 67 cents per share during the same quarter last year.

The company's base earnings for the quarter, which excluded market-related impacts and other items, totalled $543 million or 59 cents per share, down from $569 million or 58 cents per share a year ago when it had more shares outstanding.

Analysts on average had expected an adjusted profit of 59 cents per share for the quarter, according to financial markets data firm Refinitiv.

Those numbers caused the company's stock to drop by 3.3 per cent to $21.22 in Thursday afternoon trading and came as Mahon said the company had suspended share buybacks and was not planning to increase its dividends.

Great-West Lifeco's quarter has been much like its fellow Canadian insurance companies, Manulife Financial Corp. and Sun Life Financial Inc., which both reported this week that their net earnings had taken a hit because of market headwinds.

Each of those companies has been forced to transition their employees to work from home. About 98 per cent of Great-West Lifeco's staff were able to make the shift.

At the same time as they were getting used to being away from their workplaces, doctors, dentists and other medical practitioners were closing their offices and turning to virtual care amid the pandemic.

Those conditions and a global population in need of financial relief pushed insurers to slash premiums and waive some fees.

Great West Lifeco has seen fewer health and dental claims as clinics have closed, but a "modest" increase in disability claims in Canada, Mahon said.

"We expect health and dental claims to gradually return to normal levels and will closely monitor disability claims," he said.

He is expecting increasing unemployment levels to trigger some attrition in his company's group business.

With advisers unable to meet clients face-to-face, he also predicted sales of insurance for individuals might fall.

"While there is potential for an increase in plan terminations, government programs and the flexibility we have introduced has limited any significant impacts to date," said Mahon.