Study: Extreme weather impacts on consumers and insurers in Canada: An updated analysis, December 2019 to December 2025

Released: 2026-06-16

Extreme weather impacts insurance costs

Canada's property and casualty (P&C) insurers have faced growing financial pressure, driven by an increase in extreme weather events, higher building and replacement costs, higher repair costs and a rise in vehicle prices and thefts. These factors have contributed to higher insurance expenses, and insurers have raised premiums to compensate. From December 2019 to December 2025, homeowners' home and mortgage insurance premiums increased 45.0%, more than double the increase in the all-item Consumer Price Index over this period (+21.0%). Passenger vehicle insurance premiums rose 23.9%, also outpacing overall inflation, albeit to a lesser degree.

The study "Extreme weather impacts on consumers and insurers in Canada, December 2019 to December 2025: An updated analysis" examines the effects of the rising costs of extreme weather claims on Canada's P&C insurance sector, with a focus on company profitability, regional disparities and consumer impacts.

The costliest year on record for catastrophic claims is 2024

Catastrophic claims reached $8.6 billion in 2024, surpassing the previous record of $6.2 billion set in 2016. In the third quarter of 2024, four major catastrophic events occurred within a 30-day window: the Calgary hailstorm ($3.0 billion), the Jasper wildfire ($1.1 billion), Quebec flooding ($2.7 billion) and Ontario flooding ($990 million). From December 2019 to December 2025, the P&C industry incurred more than $23 billion in catastrophic claims. Each year from 2020 to 2025 ranked among the top 10 costliest years on record for extreme weather claims, since the data began being tracked in 1983. Home insurance is more impacted by extreme weather claims compared with automobile insurance.

The personal property claims ratio (see Note to readers) reached 102.0% in the third quarter of 2024, and the overall P&C combined ratio (see Note to readers) rose to 90.9%. Despite these pressures, higher revenues, driven by premium rate increases, offset elevated claims costs and allowed the industry to remain profitable.

Alberta sees larger increase in premiums than other provinces

Alberta recorded the largest cumulative increase in homeowners' insurance premiums among all provinces, rising 391.6% across the 20-year period from December 2005 to December 2025. In the most recent five-year period, Alberta (+55.8%), Manitoba (+46.7%), Nova Scotia (+43.1%) and Saskatchewan (+40.9%) all exceeded the national rate of 38.6%. Alberta's disproportionate exposure in part reflects its elevated risk of hailstorms, wildfires and convective storms, particularly in and around the Calgary region.

Uninsured costs from extreme weather are mounting

According to multiple studies, for every dollar of insured losses, it's estimated two to four dollars of uninsured costs are incurred, including damage to public infrastructure and costs borne directly by households through property taxes. The Disaster Financial Assistance Arrangements program, which supports provinces and municipalities in recovering public infrastructure costs has seen rising costs. Historically, the Prairie provinces have accounted for the greatest share, predominantly due to flooding. Flooding also remains the primary source of insured losses; approximately $9 billion was paid out over the past 10 years, and nearly half occurred in 2024 alone.

These pressures are compounded by aging infrastructure, particularly water and sewer infrastructure, which is straining municipal budgets and contributing to higher property taxes.

Rising repair costs, vehicle prices and thefts contribute to increase in auto insurance premiums

Automobile insurance has been less directly affected by extreme weather than homeowners' insurance, but expenses and premiums have also risen. Higher vehicle prices and higher costs for parts, maintenance and repairs were contributing factors. Meanwhile, vehicle theft peaked in 2023, with theft claims surpassing $1.5 billion nationally.

Products

The study "Extreme weather impacts on consumers and insurers in Canada, December 2019 to December 2025: An updated analysis" is now available as part of the series Analysis in Brief (Catalogue number11-621-M).

The infographic "Insurance in Canada: What's driving premiums higher?", which is part of Statistics Canada — Infographics (Catalogue number11-627-M), illustrates the factors contributing to higher premiums for consumers and higher costs for insurers.

Contact information

For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; infostats@statcan.gc.ca) or Media Relations (statcan.mediahotline-ligneinfomedias.statcan@statcan.gc.ca).