According to a new report from the credit rating agency AM Best, Canada’s property and casualty (P&C) insurers drew on strong capital reserves, prudent pricing, and sound risk management practices to absorb the financial effects of the country’s costliest year for natural catastrophes.
AM Best notes that it is maintaining a stable outlook for the Canadian P&C insurance market, supported by solid profitability, steady underwriting performance, and favourable investment income.
The agency also points to Canada’s well-established and continually evolving regulatory framework, ample reinsurance capacity, and moderating inflation as key elements underpinning the sector’s resilience.
At the same time, AM Best highlights that Canadian insurers continue to face headwinds, including ongoing climate-related risks, difficulties in the personal auto segment such as increased accident frequency, and continued economic uncertainty.
“These pressures are testing the industry’s resilience and demand continual refinement of underwriting strategies and risk management practices to sustain profitability,” commented Alan Murray, Director, AM Best.
In 2024, insured losses in Canada exceeded CAD 9.0 billion, setting a new record and surpassing the previous peak of CAD 6.2 billion recorded in 2016.
According to AM Best, this total was driven in large part by a difficult 27-day stretch that saw four major catastrophic events: severe flash flooding in Southern Ontario, a destructive wildfire in Jasper, a damaging hailstorm in Calgary, and heavy rainfall and wind from the remnants of Hurricane Debby affecting eastern Ontario and southern Quebec.
“Over the past 25 years, the frequency and severity of extreme catastrophic weather events have increased noticeably, with particularly pronounced trends emerging since 2015,” Murray added. “When adjusted for inflation, the cumulative cost of these events since 2000 has reached CAD 50.6 billion.”
According to AM Best, Canada’s property and casualty (P/C) insurers achieved another year of solid financial results in 2024, posting total net income of CAD 6.3 billion, a modest decline from CAD 7.1 billion in 2023. The sector’s underwriting performance remained robust, producing an insurance service result of CAD 7.4 billion for the year.
“In addition to solid underwriting results, investment income was strong, driven by higher bond yields that reflected higher interest rates, which are likely to moderate going forward,” said Cristian Siera, Senior Financial Analyst, AM Best.
AM Best also announced plans to host an insurance market briefing on the state of Canada’s insurance industry on Thursday, Oct. 30, 2025, at the Sheraton Centre Toronto Hotel.
The complimentary half-day event will feature AM Best analysts sharing market perspectives and overviews of Canada’s key insurance sectors, along with discussions on emerging topics such as catastrophe losses, climate risk strategies, cyber developments, artificial intelligence, and updates related to IFRS 17 accounting practices.
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