Canada Insurance Market Rates

Property insurance rates decline, capacity ample

Property insurance rates declined 3%, reflecting an increasingly competitive market.

• Ample capacity led to greater insurer competition; clients typically secured additional coverage limits.
• Established insurers expanded offerings, while new entrants aggressively pursued new clients.
• Clients with risk profiles and loss histories viewed favorably by insurers experienced rate reductions up to double digits; those viewed less favorably saw minimal reductions.
• Clients already benefiting from competitive pricing typically experienced modest rate decreases.
• Insurer appetite for business led to concessions in sub-limits, deductibles, and restrictive endorsements.

Casualty rates continue to decline

Casualty insurance rates decreased 2%.

• Insurers sought modest rate increases; however, they faced significant growth targets, necessitating a balance between achieving rate adequacy and retaining existing clients.
• Insurers were generally cautious managing limits within umbrella layers; at the same time there was a notable effort to deploy more capacity in excess layers. Traditional excess insurers showed interest in lower attachment points.
• More complex risks — including in heavy industry, energy, and US-exposed companies — experienced higher rate increases.
• Canadian clients with US exposure typically experienced less favorable rates. However, access to the Canadian market at times provided an increased number of competitive options.
• The US auto liability insurance market — to which many Canadian companies are exposed — experienced claims rising into umbrella and excess layers; non-owned auto and third-party hauling exposures received greater underwriting scrutiny.
• Exclusions for per- and polyfluoroalkyl substances (PFAS) were difficult to avoid. Organizations with known exposures benefitted from demonstrating commitments to clear plans to reduce usage.
• Other exclusions and sub-limits varied by risk class and included climate change, wildfire, failure to supply (energy/utilities), mental anguish, concussion, sexual abuse, and biometrics, human trafficking, and cyber risk.

Financial and professional lines rates decline

Financial and professional lines rates declined 3%.

• The directors and officers (D&O) liability insurance market was at an inflection point, with some capacity constriction outside Canada and Canadian insurers showing a stable appetite.
• Excess insurers were interested in dropping down on towers in some cases.
• Some insurers sought new business in clients’ ancillary lines to diversify their portfolios.
• Prudence of investment choices emerged as a key underwriting theme, shifting focus from fiduciary excessive fee litigation.
• Employment practices liability (EPL) rates and exposure remained stable.

Cyber rates decline, coverage expands

Cyber insurance rates decreased 6% as capacity continued to increase.

• Clients used the competitive market to enhance coverage and reduce retentions, often resulting in flat premiums when improvements were made.
• Lower excess layer rates contributed to overall program savings; reductions of 3% to 10% were common when primary layers renewed flat.
• Coverage expanded as coinsurance requirements were removed in many cases and sub-limited enhancements increased. Organizations with improved cybersecurity controls were typically able to negotiate lower retentions.

Our rates reflect the segment mix of Marsh’s client portfolio.