Carney's victory poses trade and policy tests for Canadian insurers

^{Photo (cropped): World Economic Forum from Cologny, Switzerland, CC BY-SA 2.0, via Wikimedia Commons}

Canada’s Liberal Party is poised to form government for a fourth consecutive term, with former Bank of Canada and Bank of England governor Mark Carney at the helm.  

Carney has declared victory following Monday’s federal elections after a close fight against Conservative leader Pierre Poilievre.  

While his party is expected to fall short of a majority, Carney’s win sets the stage for potential policy shifts with implications for insurers, particularly those exposed to trade-dependent sectors and cross-border risk. 

Carney campaigned to restore economic stability and manage Canada’s deteriorating trade relationship with the United States. His calls for a new economic and security pact with the US come amid renewed tariff threats from President Donald Trump, including measures targeting Canada’s auto and manufacturing sectors. These developments could affect insurers underwriting commercial, supply chain, and export credit risks. 

The insurance industry has already been navigating volatility stemming from US protectionism and Canada's heavy reliance on exports. Roughly 75% of Canadian exports, including energy and manufacturing, are US-bound, leaving carriers and brokers exposed to shifting trade dynamics. 

Carney’s experience as a crisis-era central banker may offer reassurance to financial markets and institutional players, but his government will also be tasked with addressing long-standing structural issues, including sluggish productivity and housing access, both of which influence property and mortgage insurance markets. He has proposed doubling housing construction and scaling back immigration levels, moves that could affect demand for home and builders’ risk coverage. 

His decision to eliminate the consumer-facing carbon tax, a central issue in the campaign, may also recalibrate climate-related policy priorities, a development that could affect ESG-driven underwriting and investment strategies. 

For insurers and reinsurers, the outcome offers clarity on the immediate policy direction but leaves open questions around the durability of the Liberal mandate, given its minority status and the potential need for cross-party cooperation. 

Observers will be watching closely as Carney outlines his approach to economic resilience, trade negotiations, and regulatory oversight, all of which are key areas for Canada’s insurance and risk sectors.