Canadian Underwriter

Category: Risk

Unlicenced insurance sales are on the rise. The impact of embedded insurance

Law firm Dentons has seen a strong uptick in activity surrounding embedded insurance, particularly as it relates to unlicensed insurance activities, attendees heard last week at Insurance Bureau of Canada’s InSight Summit.

“We’ve definitely seen a significant uptick in investigation and inquiries, especially in respect of unlicensed insurance activities,” Dentons partner Marisa Coggin said Apr. 1 during a regulatory session on embedded, affinity and digital distribution models. “So, when you think about that in the context of these programs, I think that’s very likely to continue — especially in the context of AI-driven underwriting and affinity partnerships generally, and just the potential impact that may have on customers if that’s not all done properly.”

She was responding to a question from moderator Laurie LaPalme, Dentons’ global insurance sector leader, about what trends or priorities Coggin is seeing regulators embrace to deal with embedded insurance challenges.

The risk of embedded insurance activities being performed by unlicensed individuals or entities (whether corporate or platform-based) is “probably the biggest bucket” of concern, Coggin says.

“Because you’re moving through the customer journey, and you’re starting at solicitation, and you have to think about, ‘Okay, how does the customer get introduced to the concept that there is insurance available at all?’” she says. “Because they didn’t come on this website looking for insurance, right?

“Maybe some people have that in the back of their mind, but most people will not,” Coggin says, adding that how the referral or resale partner is conveying the insurance product is also important.

Restricted licensing regimes

Are regulators accommodating the ‘new reality’ when it comes to embedded insurance?

To an extent, Coggin says.

“We’ve had the implementation of a whole plethora of restricted licensing regimes, which allow retailers and other ‘non-insurance participants,’ I’ll call them, to obtain a restricted license so that they can actually be part of the distribution process, [and] they can get compensated for their role, which I think is great.”

For example, British Columbia will be rolling out their regime in 2027, Coggin reports. And New Brunswick has a bifurcated system with incidental (embedded) sale exemptions and regulatory/restricted licensing.

Quebec has a Distribution without a Representative (DWR) regime, which allows certain insurance products to be offered by ‘distributors’ rather than by certified representatives.

But Quebec’s broker association has raised concerns around distributors such as auto and recreational vehicle dealerships being able to offer replacement insurance, in which an insurer pays compensation to replace a vehicle at a dealership the insured has chosen.

Lucie Fréchette, president of the Regroupement des cabinets de courtage d’assurance du Québec (RCCAQ), told Canadian Underwriter last month it was displeased with the province’s deferment of a legislative amendment that prohibits these dealerships from offering replacement insurance.

The provincial government has postponed the prohibition until Jan. 1, 2027, meaning at that time distributors will no longer be permitted to offer replacement insurance related to vehicles they sell or lease. The product must instead be obtained through licensed representatives and firms in Quebec, such as P&C insurance brokers or agents, Dentons said in a March 2 bulletin.

Looking to the future, Coggin anticipates embedded insurance products will expand beyond their current consumer-centric focus.

“There’s not a lot happening quite yet on cyber and on the more complex commercial risks,” Coggin says. “I do think if I had a crystal ball, that is going to come online. Because we’ve seen that in other jurisdictions, and we tend to be a little bit of a late adopter in Canada…”

That said, the complexity of certain products like cyber insurance will require more consultation.

“As we grow in complexity in this space, we’re going to have to do a lot more consultation on what does it look like to offer a cyber product, digitally and in an embedded space, and what does it look like to not have a licensed, traditional broker involved…,” Coggin says.

April 8, 2026
Where Middle East war creates risks for Canada

While the conflict following U.S. and Israeli military actions against Iran since late February won’t shut down Canada’s economy, risks are rising for certain business sectors.

“Certain activities [can] become un-economic or temporarily unfinanceable,” says Marcos Alvarez, managing director, global financial institution ratings at Morningstar DBRS.

He notes there are immediate risks for Canadian commercial clients with people, assets, contracts, cargo, or counterparties in or near the Middle East. Both political violence and all-out war in the region can mean customers aren’t able to take delivery of goods or make payments, and that exporters may suffer losses of inventory or equipment.

Alvarez adds Canada’s government is “facilitating departures from the region, underscoring the practical risk around staff mobility, evacuation, and business continuity.”

Related: What Month 2 of Mideast war means for Canada’s insureds

Sectors at risk are mainly tied to shipping in the Persian Gulf or Red Sea, airlines and companies that lease to them, airports, firms financing projects in the region, contractors working in infrastructure, and commodity traders.

There are also risks for exporters that rely on coverages for cargo, credit, or political risk related to instances where they’d need to satisfy their counterparties or lenders.

“In Canada itself, if capacity tightened sharply, the pinch would likely be felt by landmark commercial real estate, major event venues, ports [and] terminals, and community institutions that need specialty terrorism or political violence protection, but that is still a narrower problem rather than a general market shutdown,” Alvarez tells CU.

Domestic concerns

He adds exposures most relevant to Canada’s homefront include hotels, malls, sites linked to diplomatic activities, religious organizations, community centres and transit nodes.

“Canada has also seen rising antisemitism and hate incidents linked to the Middle East events, which increases concerns around smaller, high-visibility losses even if catastrophic attacks remain unlikely,” he says.

“The most likely spillovers are not blockbuster losses but smaller, harder-to-model events [like] cyber disruption, threats to symbolic or community targets, and supply-chain interruptions that hit several insurance lines at once.”

Related: Why your clients keep falling for the same old cyber fraud scams

In terms of which insurance covers Canadian commercial clients should be considering, Alvarez says from his perspective at a credit rating agency, there is a shift away from narrow terrorism policy wordings toward broader coverages for war, terrorism and political violence.

“For transport-linked clients, it is usually separate marine cargo war and strikes cover, voyage-specific war-risk cover, aviation war and allied perils…crisis-management products such as [kidnap and ransom], evacuation response, and active assailant [are] the most sought after covers in times of conflict,” Alvarez says.

April 7, 2026
Why insurers shouldn’t count on building codes to prevent quake damage

Seismologists, structural engineers, and developers aren’t always on the same page when it comes to earthquake-resistant building codes, a world-renowned seismologist tells the Insurance Bureau of Canada’s 2026 InSight Summit.

“Let’s imagine we have a building built to the current code,” said keynote speaker Dr. Lucy Jones, who spent 33 years with the U.S. Geological Survey, and who served as Los Angeles’ Science Advisor for Seismic Safety. “What if your ground shaking exceeds what the code [says]?

“We’ve got a problem that the engineers and seismologists look at things in different ways. As seismologists, we do theoretical wave equations and say, ‘Oh, look at the strong shaking.’ And the engineers say, ‘We’ve never recorded this. We need real data.’”

And then on Feb. 6, 2023, a Magnitude 7.8 earthquake struck southern and central Turkey and northern and western Syria. Estimated damage from the event was more than US157.8 billion, with death estimates ranging between 59,000 and 62,000.

Jones showed a slide with a black line indicating what kind of shaking the building codes anticipated. “And their building code is the same as ours [in California],” added Jones. Blue and red lines showed what kind of shaking was actually recorded at the epicentre of the quake in Syria and Turkey.

For small buildings, a few stories tall, the building codes were built for quake frequencies of less than one second, said Jones. But for the tall buildings, “we were really far off,” said Jones, with the codes underestimating the shaking by a factor of five to 10.

“And the seismologists tended to go, ‘Hey, that’s what we were talking about,’” Jones said. And “the engineers are now going, ‘Uh, okay.’

“So we’ve got an issue there. I will say, at least discussions are happening, but don’t believe that we’ve got it covered with the building code.”

Code coverage

Jones asked the audience of insurance professionals to consider what building codes actually offer, adding that building codes do not say the structures can’t collapse. Plus, large stocks of older buildings have been built to previous code standards.

She showed slides of damage caused by various earthquakes in Los Angeles. All of the damage happened to older structures, she noted. “We no longer allow them to be built, but that doesn’t make them disappear,” she said.

She noted one dozen cities in Southern California require quake-resistant retrofits, and three cities are addressing problems related to concrete building structures.

“We’re getting somewhere, but there are still a huge number of buildings out there [that can] be running into trouble,” she said.

Jones and other seismologists modelled a quake along California’s San Andres Fault to measure what kind of damage it could do downtown Los Angeles, assuming all structures were built to the current, highest building codes.

In the modelling, 1% (about two, three, or four) of the buildings would completely collapse. Another 10% would have to be torn down, accounting for dozens of structures, and another 40% would not be usable immediately after the event.

“So we will not be able to use most buildings in Southern California…and these are the modern buildings built to code,” she said.

Also in the news: Why embedded insurance keeps this lawyer up at night

Some developers in North America shy away from spending more on up-front costs required to build to more quake-resistant standards, Jones said. “Our codes are trying to minimize life loss while minimizing upfront costs. It is not minimizing long-term costs. It’s minimizing the cost for the developer and the building owner.”

She noted in California, “it adds about 1% to the cost of construction to build to what we call a recoverable standard that you can repair the building afterwards.”

But it’s not a requirement, she added.

In fact, in California, commercial lenders don’t even require earthquake insurance if developers can show their Probable Maximum Loss following an earthquake is less than 20% of the value of the building, Jones said.

“You’d be surprised at the industry that’s out there to give you ratings of 19.4% or 19.7%,” she said. “Essentially, nobody gets commercial earthquake insurance, so the banks are going to be sitting there [after an earthquake event] holding the bag.”

Why is it worth it for developers to invest more upfront to build to a higher earthquake standard?

Jones referenced March 2011 Magnitude 9.0 earthquake that struck the east coast of Honshu, Japan. More than 20,000 people were killed, 140,000 people were displaced and more than 500,000 buildings and structures were damaged or destroyed by the earthquake and resulting tsunami.

Then, Jones showed a slide of a city that appeared untouched by the disaster.

“The city of Sendai is basically due west of the [Honshu quake’s] epicenter,” she said. “They received the strongest level of shaking, and this is what Sendai looked like after the earthquake.

“There’s essentially no damage. Because in Japan…earthquakes happen several times more often. So just overall, the code is going to be higher.

“But also, if you’re a Japanese structural engineering company, and your building fails in an earthquake, you will lose so much face you’ll never again get another job. It’s a cultural issue. They never go towards the lower level.”

April 7, 2026
Why embedded insurance keeps this lawyer up at night
When it comes to embedded insurance, the risk of insurance activities being performed by unlicensed individuals or entities is probably the biggest concern, a Dentons lawyer said Wednesday at Insurance Bureau of Canada’s InSight Summit.

Dentons partner Marisa Coggin was discussing a “laundry list of things that keep [her] up at night on embedded insurance,” which involves the integration of insurance directly into a customer’s digital purchase journey, such as buying travel insurance with a flight or device protection with a mobile phone. The use of unlicensed individuals or entities, whether corporate or platform-based, topped her list.

“This is probably the biggest bucket, because you’re moving through the customer journey, and you’re starting at solicitation, and you have to think about, ‘Okay, how does the customer get introduced to the concept that there is insurance available at all?’” Coggin says. “Because they didn’t come on this website looking for insurance, right?

“Maybe some people have that in the back of their mind, but most people will not.”

How the referral partner or resale partner is conveying the insurance product is important, Coggin says.

“Is it limited to sort of saying, ‘Here’s our marketing partner, here’s our insurance partner, who can give you insurance on this product,’ and that’s the end of it? Or is it a bit broader than that?” she asks. “So, I think that’s an important piece to look at to make sure they’re not acting in an agent capacity; and also having the proper APIs [application programming interfaces] to link the customer to the licensed platform or entity.”

Real-life example

The issues surrounding embedded insurance came to a head recently when Quebec’s broker association raised concerns about the province’s deferment of a legislative amendment that prohibits auto and recreational vehicle dealerships from offering replacement insurance. The product involves a replacement cost policy, in which an insurer pays compensation to replace a vehicle at the dealership the insured has chosen.

Lucie Fréchette, president of the Regroupement des cabinets de courtage d’assurance du Québec (RCCAQ), told Canadian Underwriter last month the association wrote a letter to the provincial government asking that they maintain the original July 1, 2026 prohibition implementation date.

But the government postponed the prohibition until Jan. 1, 2027. At that time, ‘distributors’ — including auto and recreational vehicle dealerships — will no longer be permitted to offer replacement insurance related to vehicles they sell or lease. The product must instead be obtained through licensed representatives and firms in Quebec, such as property and casualty insurance brokers or agents, Dentons said in a March 2 bulletin.

Looking ahead, coverage questions may pose another concern with embedded insurance, Coggin says.

“I recognize a lot of these products right now are pretty straightforward, and you may not have a ton of questions,” she says. “But I think as the complexity grows, you’re going to have customers or potential clients who are going to say, ‘Okay, wait. What about this exclusion? And what does this exactly cover?’

“Eventually, and I think right now, best practice is always to have a licensed person available during normal business hours to answer questions.”

Some factors to consider include:

Whether consumers have an opportunity to review terms and conditions, and have access to a full copy of the policy (ideally delivered by a licensed broker).

Whether a licensed TPA (third-party administrator) or other party is involved for claims adjusting.

Ensuring carriers have sign-off on all websites with customer-facing/promotional materials, and that partners have the proper roadmap and scripting so representatives understand what they can and can’t do.

Regarding automatic enrollment (for membership and affinity association-type plans, for example), provide consumers a chance to opt into the program. “Usually, the customer either doesn’t know they’re getting insurance coverage or doesn’t understand what the cost of that coverage is, and they can’t opt out,” Coggin says.

Remuneration/compensation structures – i.e. no compensation if individuals/entities don’t hold licensing for acting as an ‘insurance agent.’

Ensuring customers know when they are dealing with artificial intelligence and that they can opt out and deal with a human licensed agent, should they choose.

Finally, all parties must comply with applicable privacy rules. Sometimes, carriers and retail partners can act in silos, leading to a lack of collaboration and understanding, Coggin says.

“At first, the customer is okay with giving their information to you, the retailer, let’s say,” Coggin explains. “They’re not expecting necessarily for it to be transferred to someone else, much less for all the expanded uses that we are not using all of this data and information for.”

It’s also important to be mindful of geography, or data-crossing borders. “Because there’s all sorts of rules about transfer of information or personal information.”
April 2, 2026
Why Canada’s commercial market could start to firm up in 2026 H2

Given widening gaps between commercial property and liability exposures and commercial insurance premiums, one industry exec sees some select commercial lines starting to firm up in mid-2026, with a broader market correction happening in early 2027 if the trend continues.

“Through the rest of 2026, I would expect to see those NISR [Net Insurance Service Ratio] numbers continue to creep up as we see cost inflation, as we see business interruption timelines going up,” says Lasith Lansakara, vice president of strategy and product innovation at HSB Canada.

“I don’t think it would be a broad rate correction, but you’ll see selective lines starting to harden a bit by mid this year. And then I would expect by early next year again, if the condition continues — it’s hard to predict at this this point — but I’d expect to see broader rate correction towards the end of this year, early ’27 and mid next year.”

Lansakara was on a panel discussing the state of commercial lines at the Insurance Bureau of Canada’s 2026 InSight Summit conference held in Toronto on Apr. 1. He says reinsurers would likely start to price for cost inflation and longer business interruption times in July 1 renewals.

NISR is a measure of profitability. It adds a company’s gross insurance service ratio — a division of expenses (i.e., claims) by revenue (i.e., premiums) — and a reinsurance impact ratio. The reinsurance ratio is calculated by dividing net expenses from reinsurance contracts held by insurance revenue. Numbers greater than 100% mean a company is losing more money than it’s making.

MSA Research numbers shown at IBC’s InsightSummit show NISRs in aviation lines in several areas across Canada are higher than 100%. The same is true of Commercial General Liability lines (including products). In eastern Canada, the legal expense line has NISRs above 100%.

Lansakara was commenting on slides presented by Sarah Fong, vice president of MSA Research. The slides showed gaps between an increase in commercial liability and property exposures, and commercial insurance premiums collected.

For example, although GDP growth in Canada was 3.2% in 2025, total commercial liability premiums ($5.8 billion in direct written premiums in 2025) declined by 1.6% overall.

Also in the news: What Month 2 of Mideast war means for Canada’s insureds

Similarly, non-residential construction investment in Canada rose 2.6% in 2025, but commercial property premiums (about $7.48 billion in direct premiums written) decreased by 0.13%.

“We’ve got commercial liability premiums, I’m tracking this against what we use as a proxy for exposure, that being the income-based nominal GDP,” Fong says. “This tracks a lot of things like salaries and revenues, things you would see come through as an exposure for liability.

“You can see, starting from 2021, liability premiums growth is leading and [nominal GDP growth] is following. And they’re pretty much tracking together until you see a bit of the flip in 2023, of the last couple of years.

“And then, the exposure remains right around 5%, and it drops a little bit, down to 3.2% in 2025, whereas liability premiums really drop off there. We’re now into negative [premium] growth.

“And similarly, we’re seeing commercial property in 2021 coming out of the hard market period, premium growth was up, exposure was down. In the post-COVID period, that picks up — we’re using non residential construction investment here as proxy — and [premiums and exposure growth are] largely tracking together. But then again, as we get to 2025, you see that gap widening between the premiums and the exposure growth.”

Related: Safer air travel isn’t translating into profitability for aviation insurers

Based on these trends, Fong asked Lansakara, which specific commercial lines may start to firm up earlier than others?

Pricing for aviation is one of the possibilities, Lansakara says.

“It’s probably almost a crapshoot right now. I saw Emirates Airlines got coverage at about $100,000 to cover their whole fleet, whereas other airlines are getting it close to $70,000 to $100,000 per aircraft. That’s…a significant delta in pricing there. So it’s a complete crapshoot.”

Marine rates will likely firm up as well, Lansakara says, due to increased shipping exposures caused by the U.S. and Israel’s war against Iran.

“It’s really hard to price shipping because of the uncertainty caused by the war,” he adds.

“Even if you look at the conflict in the Middle East, there is talk now of the U.S. pulling back. And so if that happens, what happens to the Strait of Hormuz?”

Approximately one-fifth of the world’s oil is shipped through the Strait of Hormuz, which Iran has effectively closed to shipping traffic in response to the U.S. and Israel’s attacks.

“How much will those shipping costs to pass through [the Strait] with the freight persist? And even though we don’t rely on a lot of that oil in Canada, as the WTI Index goes up, that’s going to have impact to the energy we consume,” Lansakara says.

West Texas Intermediate (WTI), often referred to as the WTI Index, is a high-quality, light, sweet crude oil that serves as the primary pricing benchmark for North America, as Investopedia notes.

April 2, 2026
What Month 2 of Mideast war means for Canada’s insureds

As U.S. and Israeli military action against Iran enters its second month, the conflict zone continues to widen.

For all intents and purposes what financial analysts call ‘Tehran’s tollbooth’ remains closed to crude oil shipments. And businesses operating in the region must continue to manage risks posed by a conflict for which no end is in sight.

From an insurance-perspective focus for multinational clients with operations in the region, James Lloyd, a senior vice president specializing in political violence and terrorism at Bowring Marsh, says his team’s exploring what coverages those firms have in place around war perils.

He works with companies in the energy and logistics space, and with multinationals with offices in impacted cities. He explains war perils coverages address insurrection, revolution, rebellion, coup d’état, mutiny, war and civil war. Additionally, there are political violence peril policies that cover terrorism, sabotage, strike, riot and civil commotion.

“Specifically [they’re looking at] whether their insurance program would respond in the event that [even if] they might not be directly targeted, that the building in which their office is located [got] hit by a drone or missile, or their actual physical assets somewhere else are directly damaged,” he tells Canadian Underwriter.

Such clients are examining what changes to their risk picture mean in terms of losses from a property damage and physical damage perspective, “and then, the business interruption that might follow-on from that.”

Related: Will U.S. political risk insurance help restart oil traffic?

While war exclusions are a primary barrier to claims in standard policies, they’re not the whole story, adds Marcos Alvarez, managing director, global financial institution ratings at Morningstar DBRS.

“Clients can still buy specialist cover where those perils are affirmatively insured [and include] stand-alone terrorism, broader political violence, marine cargo war and strikes, hull war, aviation war and allied perils, political risk insurance, and crisis-management [and kidnap and ransom] products,” he tells CU.

“There are also statutory or legal exceptions at the margins, but they are not uniform across Canada. [For example], provincial workers’ compensation systems are no-fault schemes rather than conventional market policies. At the same time, it is still difficult to say that ‘fire following’ a terrorist attack is a clean national carve-out for commercial clients – the rules vary by province.”

Related: A protracted Iran war spells trouble for Canada’s insurers

In general, specialty coverages help clients work around standard war exclusions that are part of property policies, notes Tarique Nageer, terrorism placement advisor at Marsh Risk. Political violence coverages and policies in the political risk market do not have exclusions for war perils.

“We recommend exploring political violence coverage as an add-on or a full coverage onto their terrorism policies,” he tells CU. “That removes the concern of having war being excluded on the policies.”

He adds the policies do contain an exclusion that applies if a war breaks out between five major powers within the United Nations – the U.S., U.K., Russia, China and France.

“That becomes a not-covered situation,” he says. “But if any one of those five are involved with conflict with another country, like what’s happening now, that is covered within the policy.”

Covering immediate needs

Meanwhile, the clients the Lloyd’s team works with are showing interest in specialized policies that respond to people-related risks, such as emergency evacuation coverage for employees and other insured persons who are currently in the conflict zone.

“We’ve certainly seen claims activity around that where, although there hasn’t been a directive coming from the U.K. or the Canadian government to evac those specific territories, there’s certainly been a number of specific security and medical-related emergencies that require individuals to be extracted, and for insurance coverage within the special risks (kidnap and ransom) area [that] would respond to those types of scenarios,” he says.

April 1, 2026
SAAQ chasing $1.5 million wired to fraudsters posing as IT vendor

Quebec’s public auto insurer has turned to the Ontario courts after losing $1.5 million in an apparent “spoofing” cyberscam.

In a statement of claim filed with the Ontario Superior Court of Justice in Toronto, the Société de l’Assurance Automobile du Québec (SAAQ) says that in early March, fraudsters tricked the insurer into sending two separate payments to a CIBC bank account in Sudbury, Ont., in the mistaken belief that the account belonged to an IT vendor it had recently retained for data management services.

In addition to seeking damages and legal costs from the alleged fraudsters, SAAQ’s claim also asks for a court order to freeze the remaining funds in the CIBC account where the money was allegedly sent. SAAQ also seeks an order to obtain any records the bank holds about the account owners and their assets.

According to SAAQ’s claim, which has not been proven in court, the fraudsters laid the groundwork for their heist back in December 2025, communicating with SAAQ via fake email addresses “designed to mimic the legitimate” addresses of the IT vendor.

In those original messages, the fraudsters, posing as the IT vendor, warned SAAQ they were planning to change their direct deposit information and requested details of pending payments owing to the IT company, citing an upcoming annual reconciliation and audit.

The fraudsters followed up in February this year, providing SAAQ with its new direct deposit details, supported by a void cheque from CIBC and a faked “letter of direction” that appeared to be on the IT vendor’s letterhead.

In early March – the precise dates are not specified in the claim – SAAQ then made two payments to the new bank account: one for $830 and another for $1.506 million.

Also in the news: New and improved benefits under Alberta’s Care-First auto reforms

The claim says SAAQ only discovered the scam on Mar. 11, when the public insurer issued a standard deposit notice to the IT vendor’s legitimate email address. In response, the IT vendor said it never received the money, and the bank account where it had been sent did not belong to them. SAAQ filed its legal action less than a week later, on Mar. 17.

Geneviève Côté, a spokesperson for SAAQ, said in a statement that the insurer is not anticipating any financial loss, due to its swift discovery of the fraud and prompt actions in response. While the legal proceedings continue, SAAQ will not be making any further comment, she added.

Cyber claims in Canada went up by 102% over the course of 2025, according to a recent report by the cyber insurer Coalition.

Any increase in 2026 could be just as spectacular, if the experience of Rafaella Rullo is anything to go by.

Rullo, a lawyer in the Toronto office of law firm DWF Group, frequently assists clients with the recovery of funds lost in transfer frauds as part of her practice focusing on privacy and cyber security.

“We’ve seen a massive uptick, even within the last year. The primary reason is the fact that these attackers are becoming so much more sophisticated. It’s becoming increasingly difficult to pinpoint indicia of fraud,” she says. “Long gone are the days when you get a funny email written in Comic Sans with something very conspicuous.”

According to Rullo, the success of the recovery process depends largely on how quickly the victim can report the fraud to both their own financial institution and to the recipient’s.

“In my experience, the ‘safe window’ is usually about a 48-hour period,” she says, adding that smaller sums typically have a lower recovery success rate, because it is easier for fraudsters to move the money out of their account without raising suspicion.

Dave Oswald, the founder of Forensic Restitution, a fraud detection and recovery firm based in Oakville, Ont., says red flags should always be raised whenever a supplier asks to change their bank payment details.

“As soon as you have a request, pick up the phone and call someone at the supplier that you actually know, not just any number you see at the bottom of their message,” he says. “Ask them if they actually meant to change their bank account or if it’s a fraud attempt, in which case it will be stopped at that point in its tracks.”

April 1, 2026
Final tally for March 2025 Ontario and Quebec ice storm

Final cost estimates from Catastrophe Indices and Quantification Inc. (CatIQ) place the final insurance industry loss estimate for the Mar. 28-31, 2025, ice storm in Ontario and Quebec at $466 million.

This is the fifth, and final, estimate from CatIQ and serves as a snapshot of the insurance market one year after the event.

The estimate notes the loss number covers both commercial and residential property claims, as well as auto claims, including additional loss adjustment expenses. There’s a slight decrease from the $490 million estimate issued last September due largely to a decline in personal lines losses for Ontario.

“This final estimate shows a slight decrease in the personal line losses versus the six-month mark, which, as noted at the time, demonstrated somewhat above-average growth last autumn,” says CatIQ director Caroline Floyd.

“At this point, it seems reasonable to expect that insurers feel comfortable they have received all the outstanding claims, particularly those related to any seasonal access properties, and have released their additional reserves.”

Related: Toll from Quebec and Ontario ice storms…so far

Floyd says claims data indicates more than 90% of personal lines claims have been closed, which is consistent with expectations for an event of this ice storm’s magnitude one-year on.

The multi-day March storm saw Ontario’s Kawarthas region experience 35 hours of freezing rain, resulting in up 25 mm of ice accumulation. That ice strained power lines, trees and other surfaces, leading to widespread damage and power outages for hundreds of thousands of utility customers.

Some of those disruptions lasted for weeks and may have slowed people’s ability to visit impacted properties, leading to further loss tallies.

In a related statement, Insurance Bureau of Canada adds the storm was 2025’s costliest severe weather event across Canada, and it ranks as the sixth costliest storm in Ontario’s history.

“Severe weather events continue to intensify. Insured losses from catastrophic weather and wildfires have nearly tripled over the past decade, rising from $14 billion annually to $37 billion, while claims have almost doubled,” says Maximilien Roy, IBC’s vice president for strategy.

“This reality demands a different approach to how we build and plan communities – and investing in resilience now is critical to keeping Canadians safe and insurance available and affordable.”

March 31, 2026
How to insure AI data centres in Canada

Fuelled by the boom in artificial intelligence, data centres in Canada are on the rise, and represent a new business opportunity for the Canadian property and casualty industry.

But the risks posed are significant and will likely require brokers and insurers to come up with subscription policy solutions, says a Marsh Canada executive.

“$300 million is not a large project anymore,” says Chris Johnson, Marsh’s communications, media and technology industry leader for Canada. “We’re seeing ones in the $1 billion-plus range in Canada. So, to find a single carrier who wants to go on risk for such a large project is very rare.”

Rise of data centres

A recently released report from Marsh, “Unlocking the digital infrastructure opportunity: Protecting capital and enabling growth,” says an estimated US$3 trillion will be invested in digital infrastructure worldwide by 2030.

“Probably about three-and-a-half to four percent of that will show up in Canada over the next five years,” Johnson tells Canadian Underwriter. Although that number may sound small, it equates to US$105 billion to US$120 billion.

Applying AI pressures

Most of that investment, says Johnson, is in response to leveraging gen AI and eventually agentic AI in all facets of commerce, communications, and social interactions.

Most recently, Bell Canada announced on Mar. 16 it would invest $1.7 billion in a 300 MW purpose-built AI data centre on the outskirts of Regina, Saskatchewan. A significant portion of that facility’s power, it says, will be dedicated to “ensuring that government agencies, researchers and enterprises in Canada can access top-tier AI power while guaranteeing their data remains within Canada, meeting strict chain-of-custody and residency requirements.”

The topic of data sovereignty is heating up, Johnson says. Canadians have traditionally benefited from having direct and short distance communications with US hyperscalers. But Johnson says people are realizing that “having Canadian-based data and processing reside physically in Canada will be an increasing trend moving forward.”

Doubling data capacity

Depending on whether you count older and smaller centres, explains Johnson, Canada currently has anywhere from 250 to 300 data centres. “Our expectation is we’ll likely [hit] 450 to 500 over the next five years.”

Also in the news: New and improved benefits under Alberta’s Care-First auto reforms

An estimated two dozen new builds will be hyperscale supports of 100 MW or larger. The rest will be in smaller spaces as individuals and businesses become closer to their data and to controlling who has access to and can leverage it.

According to the Marsh report, Canada presents unique advantages for data centre development, including abundant power supply, lower cooling costs due to climate, strong government support and subsidies, and competitive insurance rates.

Insuring multi-layered coverage

How will these data centres be insured?

To arrange coverage for such large-scale projects, brokers typically rely on subscription policy offerings. Typically, when building up a tower solution, multiple carriers across lines sign on for a portion of the total limits required. It is the job of the broker to build out a competitive program that offers coverage for all phases so a project can move forward.

And what are the risks?

The most expensive and inflammatory risks are contractual: for example, the ability to maintain service level agreements (SLAs) with tenants. Startup delays, which rely not only on funding but on the preliminary provision of roads, electricity, and access to skilled labour, for example, can result in significant penalties. Downtime once a centre is online can also prove disastrous.

Although there are few losses to reference, Johnson cites the major fire in South Korea last fall. Sparked by a lithium battery explosion during maintenance, the resulting fire produced a thermal runway that made it difficult to contain the blaze. More than 600 servers were shut down, damaging 96 of the 647 government information systems housed at the centre. Almost 400 battery packs were also extracted as a safety measure.

“There is an absolute real risk in regard to what I’ll call ‘Black Swan’ events,” says Johnson. “When something goes wrong with a data centre, it can become catastrophic at a level you haven’t seen.”

Those risks, however, are rare. Historically, compliance across the board is very high over time.

“So, if you have appetite,” says Johnson, “and you can get comfortable with things like the physical cost of the property, the potential cyber risk, the contracture risk, and parametric solutions, there’s a great opportunity for everyone to work well together and to collaborate successfully.”

March 31, 2026
Are Nunavut hamlets ‘uninsurable’?

Municipalities in Nunavut received $78 million dollars from insurance companies between 2018 and 2025, convincing Canadian companies to declare communities in the territory “uninsurable,” according to Peter Boucher, principal attorney for the Nunavut Association of Municipalities Insurance Exchange.

During that period, hamlets received more than 10 times as much from insurance companies as they paid in premiums, Boucher explained to a crowd of municipal officials at the Baffin Mayor’s forum on March 11.

Hamlet buildings, water tanks, trucks, and any other property a community government insures are often in poor condition and likely to result in an insurance claim, he said.

In May 2025, hamlets were close to being left without insurance before the Government of Nunavut agreed to step in, just before the non-profit Nunavut Association of Municipalities Insurance Exchange was ready to end its operations.

“The board was ready to wind up your insurance program, potentially exposing all of you to going to buy insurance for yourselves. And I can tell you right now, most communities are uninsurable,” Boucher said.

Instead, a new system for insuring hamlet-owned property and assets is being enacted this year.

UK insurance [market] Lloyd’s of London is now covering hamlet-owned property, but at a much higher cost to Nunavummiut taxpayers.

The GN is providing $11.25 million to help cover the expenses, up from $850,000 in past years, according to Boucher.

But hamlets could still see their insurance premiums spike if their assets aren’t up code.

“Insurance is only a means of spreading payments over time. It’s not a new pool of money. So we’ve explained to the Government of Nunavut that the price that we pass on to you is not dictated by us. It’s dictated by our losses, our values and outside factors,” Boucher said.

Building inspectors will be travelling to each community to assess the condition of hamlet building roofs, water boiler storage and vehicle garages. Eight municipalities will be inspected per year.

Communities with poor infrastructure will pay more, and communities in good shape will pay less.

“If Arctic Bay is fully code compliant, we will credit them. And if another community isn’t compliant at all, then they will get a debt. They’ll get an additional charge,” Boucher said. “If you have a 35 per cent increase in your asset value, you can expect a 30 per cent increase in your insurance cost next year before we even talk.”

March 30, 2026