Every year, extreme weather events hit Quebec and Canada. In 2024, insured losses due to severe weather events nearly tripled in one year, reaching a new high of more than $9 billion. 

State of the home insurance market :

Healthy but Pressure is Building

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Property and casualty insurers are very concerned by climate change and extreme weather phenomena, because as soon as such an event occurs, they are there to respond to the insured and victims and assist them with the claim settlement.

While the home insurance market remains strong, tensions are being observed in various regions with high claims risks. For the policyholders concerned, this translates into increases in premiums and sometimes a decrease in access to certain coverages. 

For many years, IBC advocates for adapting and using risk attenuation measures to make Québec’s cities and regions more resilient to climate change. Canada must act before the situation becomes critical. 

IBC has also done research and is working on solutions to help Canadians and Quebecers protect themselves from the devastating effects of these events. It has just published a report on the home insurance market in which it proposes a three-point plan for resilience. 

The approach of the BAC in the face of climate change: a three-point plan

1. Improve how and where we build

    • Create a more adaptable building code framework and more stringent building code standards that account for the heightened risk of severe weather.

    • Modernize land use rules to ensure the anticipated surge in new housing developments does not worsen Canada’s risk profile.

    • Reinforce Canada’s existing housing stock. 

    • Incentivize property owners to retrofit their homes to better withstand severe weather. 

2. Invest in resilience and help communities mitigate their risks 

    • Make Canada a world leader in natural catastrophe mapping and early detection: develop, update and share detailed climate-risk maps at local and national levels, and invest in early detection processes and technologies that would provide better warning of severe convective storms. 

    • Ensure that Canada’s public infrastructure fosters resilience – and is built resiliently : Governments should invest in measures that enhance community resilience, while ensuring public assets are made more resilient. 

    • Increase municipal capacity to plan for resilience. 

    • Increase investment in disaster recovery. 

3. Address market gaps while avoiding interventions that reduce market capacity  

    • Address protection gaps : leverage public-private partnerships to close clearly identified market gaps. 

    • Maintain regulatory frameworks that encourage risk-based pricing. Avoid the kinds of harmful pricing restrictions that have devastated other property markets. 

Consult the infographic: A three-point plan to keep homeowners protected

Natural catastrophes on the rise

Over the past 30 years, the frequency of natural disasters and their cost has continued to increase, a worldwide trend, which Québec and Canada have not escaped.

This increase has major impacts for Quebecers, especially since it:

  • Threats the assets and financial security of citizens and businesses
  • Damages vulnerable infrastructure and greatly affects natural resources
  • Becomes a tax and financial burden for governments and municipalities (restoration costs)
  • Has a significant social and economic impact for the areas and populations strongly affected by these events.

For more than 10 years, the costs of insured catastrophic losses in Canada continues to rise. In 2024, they broke a record and reached $9.1 billion and over the past five years, the average is $4.3 billion per year:

In Québec, the trend has been similar with the cost of insured catastrophic claims averaging more than $877 million per year for the past five years.

Catastrophic losses in Québec

Home insurance and disasters

Whether you are an owner, co-owner or tenant, your home insurance basic policy covers most events, sometimes referred to as “Acts of God”.

Although it is possible to insure against these risks, it is essential to act to limit the damage. Different prevention measures can make all the difference. Consult our file on the resilient home to find out how you can better protect your home against the vagaries of the weather. Resilient homes | infoinsurance.ca 

Insurance contributes to recovery

Global research shows that:  

  • Every dollar invested in risk mitigation translates into a decrease in future losses of between $5 and $10.  
  • Where insurance underwriting is higher, natural disasters have a smaller impact and recovery is faster. 

Continuous actions

IBC undertakes continuous actions to raise public awareness of extreme weather events:

  • Awareness campaigns about extreme weather events on various platforms
  • Media relations and media releases to support disaster victims during crises (ice, floods, tornadoes)
  • Support and coordination among insurers, the authorities and policyholders regarding claims settlement for losses during disasters
  • Publishing studies