From 1983 to 2008, insurance companies in the country spent about $400 million on average annually on catastrophic claims, but since 2009 that number's risen to almost $2 billion.
From 1983 to 2008, insurance companies in the country spent about $400 million on average annually on catastrophic claims, but since 2009 that number has rise to almost $2 billion. Recent hurricanes, floods and historical wildfires saw that number balloon to $3.4 billion in 2022 and $3.1 billion last year — 50 per cent more than the yearly average.
With more claims, the study by StatCan notes that insurers are in turn facing more risk with reinsurance rates — effectively insurance for the companies — trending upwards by as much as 25 to 70 per cent. This allows insurers to avoid taking on 100 per cent of the risk and even avoid insolvency, but with ongoing disasters, the study notes it’s becoming more costly for the companies to manage their risks.Meanwhile, consumers are left with higher insurance premiums.
But Kleffner notes there are things that can be done in order to reduce the risk to homeowners, such as moving away combustible materials from the home to prevent wildfires.Story continues below advertisement “Extreme weather events are going to get more extreme going forward,” he said. “So we should be moving very, very rapidly to better protect communities and homes from flooding, wildfire and extreme heat.”
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