Insurance Trends in Canada: Challenges and Opportunities
The first half of 2024 has been a promising start for Canadaβs property and casualty (P&C) insurance sector, with revenues up by 9.25% and net income growing by 60% compared to 2023. These numbers indicate stability however the challenges loom as the industry faces record-breaking natural disasters and other emerging risks. Wildfires, floods, and severe storms impacted communities across the country, resulting in nearly 25,000 insurance claims – a staggering 406% increase compared to the 20-year average. This makes 2024 the most expensive year for natural catastrophes in Canadian history. While insurers are equipped to manage claims, the sheer scale of these events will undoubtedly strain resources.
For residents and businesses, these shifts underscore the importance of partnering with reliable insurance brokers like Akan Insurance.
How Does This Impact Policyholders
As insurers handle these large-scale losses, residents can experience:
- Higher Premiums: due to rising reinsurance costs and increased risk assessments.
- Changes in Coverage: Particularly for properties in high-risk areas.
- Innovative Solutions: Adoption of parametric insurance, offering faster payouts based on predefined triggers like rainfall or heat levels.
To stay protected, customers should prioritize working with financially stable insurers, ensuring reliable claims processing during crises.
Trends Impacting Your Insurance
Severe Weather: Climate change is driving more frequent and severe natural catastrophes, forcing insurers to rethink their approach to coverage in high-risk areas. For Canadians, this means rising premiums, reduced coverage options, and greater uncertainty, particularly in regions prone to extreme weather events. However, insurers are exploring innovative ways to manage the growing risks. Traditional coverage, which often focuses on major disasters, is being supplemented by forward-thinking solutions designed to address the financial impact of smaller, recurring weather events. This evolution is especially important in high-risk areas like Alberta and British Columbia, where rising premiums and reduced coverage options are becoming common. As climate change intensifies natural disasters, both insurers and policyholders must adapt. Homeowners can implement wildfire preparedness plans and flood prevention measures. Businesses can explore proactive options like parametric insurance to cover recurring weather impacts.
Auto Theft: Auto theft in Canada continues to surge above historical levels, even though efforts to combat vehicle theft are starting to show results in especially Ontario and Quebec, where auto theft reached crisis levels last year, according to the latest data from the Insurance Bureau of Canada (IBC). Canada saw a 19% decrease in insurance claims for auto theft in the first half of 2024. But looking at the past decade, auto claims rose 148%, with the value of those claims skyrocketing 442% between 2014 ($100 million) and 2024 ($544.7 million). Auto theft, often driven by organized crime rings, continues impacting driversβ insurance premiums, compromising public safety, and causing Canadians concern and trauma. We recommend you install aftermarket anti-theft systems to deter theft and qualify for insurance discounts. Not only can this help reduce your chances of becoming a target for car thieves, but an anti-theft system that tracks your vehicleβs location if it is stolen can also help with the recovery. Explore TAG tracking systems for high-risk vehicles, which some insurers subsidize to help reduce theft rates by up to 98%. Get auto insurance today and keep your vehicle protected.
Conclusion
This is the right time to review your insurance coverage and risk management strategies with your trusted insurance broker. Whether itβs your home, car, business, or other assets, itβs essential to stay prepared and properly protected. Partnering with an insurance broker means getting expert advice, tailored coverage, and the tools you need to safeguard what matters most β because your interests always come first.
