Canada Insurance Market Pricing

Canada property market driven by CAT exposures

Property insurance rates rose 2%.

• Ample capacity was available domestically and internationally. 
• Increases were mainly driven by risks that were viewed by insurers as lacking focus on engineering and that had poor loss experience and/or critical catastrophe (CAT) exposures, particularly to British Columbia earthquake and US severe convective storms.
• Some clients significantly increased retentions.
• Certain classes of business — including recycling, forestry, food, and warehousing — faced more difficult renewals.

Casualty insurance lines decrease, auto liability the exception

Casualty insurance rates decreased 1%.  

• Overall, casualty rates decreased in the low-single digits; however, auto liability increased in the low-single digits.
  • More complex, heavy industrial, and/or energy risks, and those with significant US or transportation exposures, generally experienced higher rate increases. 
  • US auto claims continued to reach into umbrella and excess layers; in many cases claims costs outpaced rate increases.
• Insurer exclusions and sub-limits were common, depending on the class of risk, for polyfluoroalkyl substances (PFAs), climate change and wildfire, concussion, sexual abuse, and biometrics.

Financial and professional lines continue to decline

Financial and professional lines rates declined 4%.

• Competition in the public directors and officers (D&O) liability space continued; many clients realized premium savings and/or negotiated enhanced coverage.
• While the overall employment practices liability (EPL) market stabilized in 2023, claims related to the state of Illinois’ Biometric Information Privacy Act (BIPA) were a growing insurer concern.
  • Some insurers have added BIPA claim exclusions to EPL policies, some limit the use of exclusionary language only where there is Illinois exposure, and some seek to apply exclusions more broadly.

Cyber coverage continues to broaden

Cyber insurance rates increased 3%. 

• New capacity entered the market for both excess and primary layers; excess layer premium reductions drove total program pricing down.
• Coverage generally continued to broaden, including removal of coinsurance requirements and increasing sub-limits for coverage enhancements. 
• Insureds with improved cybersecurity controls were generally in a stronger position to negotiate lower retentions.