Despite the uncertain post-pandemic landscape that awaits Canada’s insurance market, Aon has underlined what it considers to be signs of market stabilisation and says insurers are beginning to position themselves for growth and profitability.
Aon’s report describes many of 2020’s challenges as having spilled over into 2021; notably, poor underwriting performance and the still-unclear impact of COVID-19 on the industry.
However, Aon outlines several positive signs that suggest a market transition is underway.
The rollout of the COVID-19 vaccine should lead to the return of relative economic stability, while new capacity is likely to enter the market in the second half of 2021 through insurer start-ups, reinsurance capacity and shifting insurer appetite.
In addition, Aon says the COVID-19 environment has led to insurers taking a more rigorous approach to underwriting in an effort to navigate a period of unprecedented uncertainty.
“Looking forward, as the world emerges from the impact of the pandemic, it is crucial that industry players take a proactive stance to address the opportunities and challenges that the next few years will bring,” said Russell Quilley, Chief Broking Officer for Canada at Aon.
“Starting early on the renewal process, positioning programs with a focus on the long term and being ready to make strategic changes are vital steps insurers can take now towards preparing for when the market turns.
“With our suite of industry expertise, data and analytics and risk finance solutions, Aon is here to help them do that.”