A year ago, our first annual report opened with a record: 2024's roughly $8.5 billion in insured catastrophe losses, the most expensive weather year in Canadian insurance history. The question hanging over 2025 was whether that number was an outlier or a preview. Twelve months later, the honest answer is the uncomfortable one — the multi-billion-dollar catastrophe year is no longer an event in Canada. It's the operating environment.
This report does what the first one did: pulls together the public data — Insurance Bureau of Canada (IBC) publications, CatIQ loss tallies, Statistics Canada surveys, federal insolvency statistics, global breach-cost studies — and turns it into renewal strategy for Ontario businesses. Where 2025's full-year figures were still settling at press time, we say so and stay directional; where the structural numbers are established, we use them. As always: rounded figures, cited sources, and no invented precision.
The catastrophe era, confirmed
Zoom out and the trend line does the arguing. Through the 1980s, '90s, and early 2000s, insured catastrophe losses in Canada averaged around $400 million a year. The 2010s normalized $2 billion. Then the staircase: roughly $3.4 billion in 2022, $3.1 billion in 2023, $8.5 billion in 2024 — and 2025 continued the pattern of routine multi-billion-dollar seasons driven by the same peril mix: summer convective storms and hail on the Prairies, urban flash flooding in Ontario and Quebec, and wildfire seasons that keep finding communities. IBC's long-standing observation has hardened into the industry's planning assumption: severe weather that used to be exceptional is now annual.
The mechanism that moves this into your premium hasn't changed — catastrophe losses flow through reinsurance costs into primary property rates — but its geography has sharpened. Insurers now price Canadian commercial property with genuinely local eyes: the flood cell your postal code sits in, the hail corridor, the wildland interface. Two similar buildings a concession road apart can carry meaningfully different terms, and the difference is data, not whim.
For commercial property buyers, 2026's translation: expect water and hail deductibles to keep migrating upward in exposed zones, expect underwriters to ask ever-more-specific questions (roof year, backwater valves, monitored sensors), and treat mitigation documentation as currency — because in a locally-priced market, proof that your building is the better risk on its own street is worth real premium.
The market cycle: a buyer's market with sharp edges
The broad commercial market spent 2025 continuing the softening that began in late 2023. Global broker indices tracked commercial rates decelerating toward flat, with some lines outright declining for quality risks — and Canadian placement experience followed: more insurers quoting, more capacity, more negotiating room than at any point since 2019. For well-run businesses with clean loss histories, this is the most competitive buying environment in years, and 2026 renewals should be marketed accordingly.
But the softening has edges, and they're sharp. Catastrophe-exposed property stayed firm for the reasons above. Commercial auto kept rising on its own cost engines. And underwriters, while competing on price, held the line on information: the soft market of the 2010s — where capacity chased premium with few questions — has not returned. Today's competitive quotes go to complete submissions: current financials, loss runs, control documentation. The market rewards preparation, not just existence.
Our practical read: the spread between a rolled-over renewal and a properly marketed one is as wide as we've seen it. In a hard market, shopping changes little because nobody's buying; in this market, shopping is the whole game — and sixty days of runway is what makes it possible.
Auto theft: progress, unevenly distributed
The auto theft crisis that peaked with over $1.5 billion in annual theft claims (IBC, 2023) spent 2024 and 2025 in retreat — national theft rates declined meaningfully from the peak as port interdiction, enforcement coordination, and vehicle-security attention took hold. That's genuine progress, and worth naming as such.
It is not, however, premium relief on a schedule. Claim costs remain well above the pre-crisis baseline; theft networks adapted their model mix; and the other commercial-auto cost engines — repair complexity, injury severity — never paused. Commercial auto and fleet buyers should expect 2026 rates to keep outpacing the rest of the program, with the gap narrowing for operators who can evidence theft controls, telematics, and driver-file discipline. The line's message is consistent: it pays the documented.
Cyber: stable pricing, mutating threat
Cyber insurance entered 2026 in its most orderly state in half a decade: pricing stable-to-down for controlled risks, capacity healthy, and minimum-control requirements (MFA, tested backups, endpoint protection) firmly established as entry conditions. For businesses that were priced out or declined in the 2021–22 crunch, the door is open again — with a checklist taped to it.
The threat side kept mutating. The pattern of recent years — 'quality over quantity' ransomware targeting, data-theft extortion that skips encryption entirely, and social-engineering fraud supercharged by AI-generated lures and voice cloning — pushed the loss mix further toward the human channel. Statistics Canada's survey work continues to find roughly one in six Canadian businesses reporting cyber incidents, and IBM's Cost of a Data Breach study has held the average Canadian breach above the $6-million mark. The premium-relevant conclusion: payment-verification procedures and staff-level controls now matter to underwriters as much as the technical stack, because that's where the claims are.
Two coverage notes for 2026 renewals: check your social-engineering sub-limit against real transfer volumes (it's the most under-bought line in the cyber family), and confirm how your policy treats data-theft-only extortion — wordings written for encryption events don't all age well.
The economy underneath: stress easing, buffers thin
The small-business economy insurance sits on spent 2025 recovering its footing. The insolvency wave that crested in early 2024 — when Office of the Superintendent of Bankruptcy filings spiked to multi-decade highs around CEBA repayment deadlines — receded through 2024 and 2025, though filings remain elevated against pre-pandemic norms. Canada's structural base held: roughly 1.2 million employer businesses, 98% of them small, employing the majority of the private workforce.
For insurance buying, thin buffers still argue the same priorities as last year: business interruption coverage sized on current revenue with honest indemnity periods, deductibles chosen deliberately rather than defaulted, and insurance-to-value checked after several inflationary years. A fragile balance sheet can survive a bad event or a coverage gap — rarely both at once.
The machine behind the market: the industry by the numbers, updated
The structural portrait, refreshed for the second edition. Canada's P&C industry writes more than $90 billion in direct premiums annually and climbing — premium trend follows exposure and repair-cost inflation even when rates flatten — across roughly 190 competing private insurers. Underwriting results ride the catastrophe curve: the profitable early-2020s stretch (combined ratios comfortably under 100) absorbed 2024's record losses without a solvency story, which is itself the headline — a $8.5-billion cat year passed through the system as a repricing event, not a stability event. Higher interest rates quietly helped, rebuilding the investment income that cushions underwriting swings.
Capital remains the quiet strength: OSFI-supervised insurers hold margins comfortably above the regulatory tests, and PACICC — the industry's policyholder compensation backstop — kept its streak of having very little to do. The sector also remains a major public-revenue machine, remitting billions annually in premium taxes, income taxes, and levies before any claim is paid.
For buyers, the takeaway from the structural numbers is confidence with leverage: the market you're negotiating with is solvent, competitive, and — per this year's cycle reading — actively hungry for well-presented commercial business. Use that.
A decade of catastrophes, year by year
The staircase deserves its full articulation, in rounded public figures. 2016: Fort McMurray, about $4 billion, the costliest single event in Canadian history. 2018: the May Ontario–Quebec windstorm, around $600 million, in a $2-billion year. 2020: Calgary hail again, roughly $1.3 billion. 2021: the British Columbia atmospheric-river floods, about $675 million insured — against economic losses several times larger. 2022: the derecho that raked Ontario and Quebec (about $1 billion) plus Hurricane Fiona in Atlantic Canada (around $800 million) — a $3.4-billion year. 2023: the largest wildfire season in recorded Canadian history by area burned, and roughly $3.1 billion insured across the year's events.
Then 2024's quartet: the July Toronto and southern Ontario flooding (around $1 billion), the Jasper wildfire (over $1 billion), the Calgary hailstorm (approaching $3 billion), and Quebec's flooding from Hurricane Debby's remnants (roughly $2.5 billion) — $8.5 billion total, most of it in five summer weeks. Every single year since 2020 has cleared $2 billion; the 1990s averaged $400 million.
That's the whole argument about commercial property pricing, deductible migration, and mitigation credits, told as a calendar. Underwriters aren't reacting to a bad year; they're pricing a confirmed regime.
The quarter-million-claim summer: what 2024 taught the system's plumbing
One more 2024 number worth carrying into 2026: IBC reported that the summer's four catastrophes generated roughly 228,000 insurance claims — a surge on the order of four times the recent seasonal average, landing on the industry's claims machinery in a matter of weeks. Adjusters were redeployed across provinces, licensing accommodations moved people to where the losses were, and — inevitably — service timelines stretched. The system processed it, but the strain was visible, and it taught buyers a lesson premium comparisons don't capture: in a catastrophe era, claim-service capacity is a buying criterion.
The practical translations for a business buyer. First, insurer claim reputation and cat-response capability belong in placement decisions alongside price — your broker knows which carriers cleared their 2024 queues well. Second, your own documentation determines your queue position after a regional event: businesses with current values, asset records, and photo inventories settle first, because they're settleable. Third, business interruption indemnity periods should assume post-catastrophe timelines — contractors, adjusters, and permits all run slower when an entire region claims at once.
Regional catastrophe is the scenario where preparation compounds hardest: everything in the claims playbook matters more when ten thousand other businesses are in the same line.
The protection gap: what Canada doesn't insure
The most consequential open data in Canadian insurance may be about what isn't covered. Flood: the federal task force work behind the national flood insurance program identified roughly 1.5 million Canadian households at high flood risk, many effectively unable to buy affordable protection — the gap the CMHC-connected program now coming online is designed to close, initially for residential risks. Earthquake: take-up in British Columbia is meaningful but partial, while in the Quebec City–Montreal–Ottawa seismic corridor it is strikingly low — a systemic-risk concern PACICC and IBC have both flagged publicly, since a major eastern quake would fall largely on uninsured balance sheets.
Commercial buyers should read the gap selfishly, in three directions. Your own program: property policies don't automatically include flood or earthquake — they're extensions with their own limits and deductibles, worth an explicit yes-or-no decision rather than an assumption. Your dependencies: suppliers, customers, and municipal infrastructure sitting inside someone else's protection gap become your interruption when the water arrives — the contingent-BI conversation. And your values: after years of construction-cost inflation, underinsurance is itself a protection gap, one co-insurance clauses convert into claim-time penalties.
The gap is narrowing on flood and static elsewhere; either way, the businesses that treat 'what's not covered' as an annual agenda item are the ones the next map-drawn event doesn't surprise.
The people and the plumbing: brokers, adjusters, and a talent crunch
Last structural note: the industry's people. Canadian P&C employs somewhere around 130,000 across insurers, brokerages, and adjusting firms, and its demographic curve is a known problem — industry workforce research has flagged for years that a large cohort sits within sight of retirement, with recruitment not fully keeping pace. In commercial lines, where placement is judgment work, experience scarcity shows up as slower service at exactly the moments — cat surges, hard-market crunches — when it's needed most.
The broker channel remains how the large majority of Canadian commercial insurance is bought, and for cycle reasons this report keeps returning to: in a split, information-hungry market, the placement work — which insurers to approach, how to present the risk, what the wording trade-offs are worth — is the product. The talent crunch makes the good version of that product scarcer, which is our honest, interested case for relationships over transactions: the advisor who knows your file is the one whose scarcity you want on your side of the table.
Open data worth bookmarking: the sources behind this report
A closing gift for the data-inclined owner: the public sources this report is built from are free, current, and readable without an actuary. IBC's annual Facts of the Property and Casualty Insurance Industry in Canada is the single best industry snapshot — premiums, claims, taxes, employment, the premium-dollar breakdown. CatIQ's public summaries track catastrophe losses event by event. Statistics Canada's business-conditions and cyber-security surveys put numbers on what your peers are experiencing; the Office of the Superintendent of Bankruptcy publishes insolvency statistics monthly; and PACICC's research papers are the sharpest public writing anywhere on Canadian insurer solvency and the earthquake gap.
Twenty minutes a year in those sources will make you a measurably better insurance buyer — not because you'll out-analyze your broker, but because you'll ask the questions that make the renewal conversation a strategy session instead of a transaction. Which is, after two editions of this report, still the entire thesis.
Line by line: our 2026 outlook
General liability: competitive; market it. Property: split — competitive for clean, mitigated risks outside cat zones; firm with rising deductibles inside them. Auto and fleet: continued increases, moderating for documented operators. Cyber: stable to favourable for controlled risks; social-engineering wordings the detail to sweat. Professional liability and D&O: healthy competition, with private-company D&O broadly available again. Specialty classes: placeable, relationship-driven, presentation-sensitive.
Watch-items for the year: the summer catastrophe season, as always — one more record year would firm property fast; the pace of AI-enabled fraud, which is rewriting social-engineering loss patterns faster than wordings evolve; and regulatory motion on flood — as the federal flood insurance program for high-risk residential properties comes online, expect the broader conversation about Canadian flood risk pricing to touch commercial buyers too.
The 2026 playbook for Ontario businesses
First: market the renewal — sixty days out, full submission, multiple markets. This environment pays for the effort like no year since 2019. Second: spend your capital improvements where underwriters price them — water mitigation, roof work, theft controls, MFA — and document all of it. Third: fix values — rebuild costs, equipment, interruption figures — because the inflation of 2021–2024 is still baked into every stale limit.
Fourth: close the persistent gaps this data keeps flagging — cyber for the uncovered, social-engineering limits for the covered, realistic indemnity periods everywhere. Fifth: if anything was declined or punitively priced during the hard market, re-shop it now. The market that said no in 2022 has been saying yes, with conditions, for two years running.
Sources and method
This report draws on public sources: Insurance Bureau of Canada releases and its annual Facts of the Property and Casualty Insurance Industry in Canada; CatIQ catastrophe summaries; Statistics Canada business-condition and cyber security surveys; Office of the Superintendent of Bankruptcy insolvency statistics; IBM's Cost of a Data Breach study; and published market indices from major brokerage and reinsurance houses. Figures are rounded; where full-year 2025 data was not yet final at publication, we've stayed directional rather than precise. Nothing here is advice on a specific risk.
If the numbers changed how you're thinking about your own renewal, that's the point of publishing them. Talk to an advisor or put your program through a marketed renewal — and we'll see you back here next January for the third edition.