Despite economic volatility, catastrophic climate events, supply chain/labour challenges, and geopolitical uncertainty, the Canadian insurance market has displayed “remarkable resiliency”, suggests professional services firm Aon.
According to the firm, portfolio remediations made in recent years have resulted in a more stabilised market with increased competition and a more diversified appetite.
However, economic uncertainty, costly reinsurance capacity, and accelerated frequency and severity of climate events have required insurers to remain strategic about the capacity being deployed.
Canada experienced 2 of the top 10 global catastrophic events in 2022, with the May derecho in Ontario and Quebec, and Hurricane Fiona, making it the third worst year for insured losses in Canadian history, with an estimated $3.1 billion.
Despite the aforementioned headwinds, Aon states that the Canadian P&C market ended 2022 with a healthy combined ratio of 85.44%, positioning the market to focus on strategic growth in 2023.
Russell Quilley, head of Commercial Risk Solutions and chief broking officer for Canada at Aon, commented, “The focus on risk quality will be top of mind for insurers and highlights the importance of risk mitigation for policyholders.
“Insurers require more information and stronger risk management practices than ever before as they navigate increasing volatility.”
