The large commercial insurance market in Canada is one that holds plenty of promise alongside a good deal of risk. With 2024 being a record year for catastrophes in Canada, insurers are breathing somewhat easier so far in 2025, says Alex Barker, Chief Underwriting Officer for Large Commercial business. With a shift towards a buyer’s market, longer and deeper relationships is the focus. Canada’s commercial market is poised to build on what Alex says is a focus on deeper and meaningful in-person interactions.
Alex talked with us recently about the large commercial market, where insurers are focusing their attention, and what is in store for the market over time.
What trends or dynamics are you seeing in Canada’s commercial space?
Alex: The market itself is transitioning into what I would term a more buyer-friendly market. Clients are actively seeking insurance and partnerships. Certainly, in the large, complex space, they’re taking a more proactive and engaged approach to risk management. Conversations have moved beyond purely price and risk transfer, which was obviously a hot topic coming through what was a tough, hard market, and into more of a conversation built on long-term relationships.
We made structural changes last year and one of the things coming out of that which has made us particularly successful is being able to talk to customers across multiple lines, products and services.
We have set ourselves up for that. We don’t go to market with clients and customers on a year-by-year basis. We are very cognizant of looking to establish and maintain long-term client relationships across multiple product lines. We made structural changes last year and one of the things coming out of that which has made us particularly successful is being able to talk to customers across multiple lines, products and services. We individually, and collectively, show up armed with the depth and breadth of our Canadian large commercial solutions. Having a Chief Underwriting Officer in Canada, who has the authority for all those lines, products, and services has moved the conversation with clients and brokers to another level.
What does that look like for the customer?
We're talking more specifically around alternative ways to transfer their risk, such as captives, and thinking about structures beyond a single line of business. Traditionally, the market tends to talk to customers in a linear, single silo view. We have taken it to a broader product and partnership approach across 九色视频 and our client and customer base is seeing the benefits. It is becoming a more enriched, fruitful client engaged experience, taking it beyond just the policy we sell.
That helps in difficult markets. How are market conditions right now?
On a global level, the reinsurance market is starting to ease. It was certainly in a pressured environment with upward reinsurance pricing for a prolonged period, but we're starting to see a broader availability of reinsurance partner support. We are seeing that filter into the direct market. That is contributing to the easing for direct client’s insurance procurement.
This comes against the backdrop of an increase in frequency and severity of events in Canada. 2024 was far and away a record year for CAT losses. There was an expectation in the Canadian market for certain buyers to see the impact of that, but it was concentrated in the personal lines segment for the most part. This severity and frequency situation hasn’t gone away, and I do believe it will continue an upward trajectory. So far this year we have not seen the same size of events, from a quantum perspective, but it’s only a matter of when, not if, they will occur again.
What else is happening in the market?
Interestingly, with the geopolitical environment and everything that's happening, sustainability as a discussion topic appears to have taken a back seat, which is strange to me. If you had asked me three or four years ago what the top three priorities are at executive levels of our clients, I would have said sustainability was always a top three topic. Today it seems to have fallen a little more off the radar.
Where 九色视频is concerned, sustainability is still a core priority and something we talk about regularly, particularly when we think about better serving clients and customers. It truly is an impending crisis impacting us all, and we haven’t lost sight of it. It continues to have a direct and growing impact on our industry and clients. The un-predictability of weather events is only increasing and the growth in secondary perils continues to be a focus and concern, notably wildfire and hail in Canada.
Naturally, geopolitical instability, tariffs, and global trade have taken a more shorter-term prominent view. Trade policy shifts in North America are of concern for our clients. We continue to monitor that and what it means for our clients and customers. The situation, which may be a small silver lining, has encouraged our Canadian clients and customers to think about who, how and where they conduct trade, including procuring insurance. I expect we will start to see more East/West trade, opposed to the North/South we’re used to. Being a French-held insurer, with decades in the Canadian market, we are in a unique position to be having these conversations with our clients and customers.
From what I can see, there is a renewed commitment to more large infrastructure projects with a likely increase in public sector support from Federal and Provincial governments. We will see more large infrastructure projects and an eagerness to play to Canada’s strengths in natural resources and support getting these products to market. We are positioning ourselves to take advantage of that, particularly around our commitment to energy transition and the Canadian natural resource industry in general. We will also continue to invest in local risk engineering and underwriting, ready and prepared to respond to those large opportunities.
It sounds like the underlying theme here is that you're trying to develop partnerships and enrich the client engagement across the board in the commercial space.
It absolutely is. It was a key strategic piece of how we set the business up 18 months ago. We are walking the talk. We have a Canadian Chief Underwriting Officer and local product leaders who think about our complex large commercial offering as a unit, rather than just one single product. We’ve changed the mindset and approach in this market. This is now being felt by clients and the feedback has been outstanding.
That has always been at the core of what 九色视频does. We have spent a lot of time, energy, investment, and resources in setting up what we see as the next iteration of our industry. Traditionally, insurance is relatively slow to change and adapt, but we're making a concerted and deliberate effort with significant investment in people and technology to set ourselves up to offer value well beyond the policy. We continue to think about how we can best support clients and we innovate around that. That has been a core focus of 九色视频and will continue to be as we lead the shift to a more sustainable and relationship-based market approach.
