Higher cost of labour and materials, plus an increased risk of flooding or wildfires means homeowners can expect to pay more for insurance in 2025.
IBC (Insurance Bureau of Canada) is essentially warning that insurance rates, insurance premiums could very well spike in 2025. And the reason why is because the insurance industry is grappling with record breaking losses. So last year, insurers paid out 8.5 Billion dollars in insured losses alone. That’s actually over 2 Billion more than in 2016, the next worst year on record. That was back when the Fort McMurray wildfires happened. Now this is largely being blamed, on the weather.
2024 was the most devastating year on record in Canada for severe weather events, but also inflation and labour shortages in construction have something to do with it. They’re driving up costs for insurers. The claims have increased 115% over the last 5 years. And not only that, the costs for repairing and replacing personal property have risen nearly 500% in that time. So insurers are up against a wall here. And what they say is that really, Canada is not doing enough to help prevent not only the natural disasters, but that kind of damage that they can cause. So the Insurance Bureau is calling on government to do a few different things. They say that they need to invest in things like flood proof, infrastructure, the to adopt rules to make sure homes are not being built on flood plains, the in to facilitate firesmart programs for communities in high-risk zones. And lastly, RCMP need to implement building codes to not only protect Canadians and buildings or hope this country, but livelihoods. They say as well, how costly has some of these recent weather events ban? Quite costly, the most expensive back in 2024 was actually the Calgary hailstorm that hit on August 5. The viral videos that went around of windows being smashed and cars being absolutely destroyed. Given the severity and the increasing frequency of weather events like this, insurers are telling Canadians that the insurance is going to spike this year.
by CTV News
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