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Survey Report

Insurance Marketplace Realities 2025 Spring Update – Canada Property

May 2, 2025

Despite 2024’s record insured losses and reinsurance concerns, the Canadian property market stabilized in 2025 with competitive rates and a focus on top-line growth.
Rate predictions: Canada property
Trend Range
Non-catastrophe exposed Neutral decrease increase (Purple arrow pointing top and bottom) –10% to flat
Catastrophe exposed Increase (purple line, purple arrows pointing up) Flat to +10%

Key takeaway

The Canadian property market continued to stabilize into 2025 with ample capacity from both new-entrant and incumbent markets driving rates downward as insurers compete for premium share. Top-line growth has been the key message from insurers throughout Q1 2025.  These conditions exist despite 2024 experiencing the largest amount of insured natural catastrophe losses (circa CAD $8.5 billion) in Canada. Concerns arising from the impact to the reinsurance market from the Los Angeles wildfires in January 2025, and the impact of U.S. tariffs to traditional trading relationships loom over the market but to date aren’t having an impact on either capacity or rating.

  • In a rate-stabilizing market, insurers are deploying more capacity to maintain (and potentially grow) their premium share, especially on accounts with clean loss records and that aren’t significantly exposed to natural catastrophe. In general, on larger quota share stretches, lead line size remains between 15% to 20%, however we’re seeing more follow lines increase up to 10% to 15%, resulting in many Q1 renewals being oversubscribed.
  • There’s also more competition among insurers for lead position on programs, creating additional competition on both rate and terms. Incumbent lead markets are acknowledging the softening market conditions and, particularly on accounts with good loss records and managed natural catastrophe exposure, some are asking to offer lead terms to dictate their line size and terms. This competition allows Insureds to push for reduced deductibles and coverage enhancements while leveraging incumbent markets for greater rate improvements. We’ve seen rate reductions greater than 10% when a new market offers competing terms on the lead position.
  • Finally, we’re seeing insurers that have traditionally not written certain risks or industries coming to the table with capacity as they look for premium growth. Again, this is contributing to the overall competitive environment and oversubscribed results on renewals. The oversubscription allows Insureds to select their insurer panel based upon concurrency with lead terms, thus removing term and rating variation.
  • Q2 presents numerous natural catastrophe conditions in Canada as the winter melt gives way to spring, key exposures being flood and wildfire. As such, insurers typically have an increased focus on these perils, although rates will be dictated by the frequency and severity of events and impact to commercial versus personal risks not to mention the availability of reinsurance. With the volume of large insurance programs renewing in Q2, insurers are focusing on understanding wildfire mitigation plans and flood mitigation efforts for those in high-hazard flood zones. Insureds would be prudent to have this information available for their renewal meetings and included within their submissions. Insurers also remain vigilant around earthquake in high-hazard areas such as British Columbia and the Ottawa-Montreal corridor, and Named Storm, as we have seen stronger Named Storm events impact the east Coast of Canada in recent years (and in some case, excessive rainfall in Ontario and Quebec associated with the tail end of those events).
  • While insurers are looking for this information, it isn’t proving to be an impediment to-date to deploying capacity, especially if insureds are able to provide information around protection and mitigation. That said, where insureds are situated within remote, forested areas, or in high-hazard flood zones, especially areas that have experienced significant losses in previous seasons, we’re seeing insurers looking to apply rate increases around 10% to 15%.
  • While natural catastrophe remains a key area of concern for underwriters, we’re seeing less focus on ESG from underwriters during 2025. We still encourage Insureds to include information pertaining to ESG to demonstrate the quality of their risk, however we aren’t seeing underwriters have as keen a focus on this topic and neither does it appear to impact capacity deployed on renewals.
  • Tariffs are presenting questions about the impact to Schedule of Values. Traditional supply chains may be impacted by the imposition of tariffs, and Insureds may need to react by sourcing parts/materials and selling products to new markets. This may impact the availability of products and materials and therefore increase replacement cost values. Also, some Insureds may need to move product or stockpile inventory at certain locations to mitigate the impact of tariffs. Thus, location values may be significantly different from what was originally declared on a schedule of values at time of renewal, and increase the overall accumulation in a specific region. Finally, revenue streams may be impacted by changes from increased costs or a change in customer buying habits, thus impacting their business interruption forecasts.
  • For the most part, insurers haven’t responded with any significant changes in the market from either a capacity or rating perspective, but they are looking to understand how insureds are reacting to the uncertainty, be it price/cost changes that may impact revenue streams and therefore business interruption, changes to supply chains that may result in increased costs to manufacturing or sales, and finally activities such as product staging or movement, which may impact inventory and accumulation at certain locations.

In summary

  • Market capacity is ample, and Insureds should be leveraging incumbent insurers through competition at renewal to drive improved rating and enhanced terms.
  • Insureds should be vigilant about changes in their exposures due to economic uncertainty.
  • Focus on natural catastrophe exposures in Canada remains key for insurers.

To read more, download the full report below.

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Insurance Marketplace Realities 2025 Spring UpdatePDF12.3 MB

Disclaimer

WTW hopes you found the general information provided here informative and helpful. The information contained herein is not intended to constitute legal or other professional advice and should not be relied upon in lieu of consultation with your own legal advisors. In the event you would like more information regarding your insurance coverage, please do not hesitate to reach out to us. In North America, WTW offers insurance products through licensed entities, including Willis Towers Watson Northeast, Inc. (in the United States) and Willis Canada Inc. (in Canada).

Contact

Jennifer Davis
Head of Property Broking, Willis, Canada 
Email+1 403 261 1427
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