In 2023, Canada’s insurance landscape had been characterized by the impact of industry challenges such as natural catastrophes and a growing auto theft crisis.
An examination of these trends offers insights into what both industry professionals and consumers can expect from the year ahead, according to experts at Ratehub.ca.
The rise in auto theft claims is poised to create challenges for both insurance companies and policyholders, according to Matt Hands, Ratehub.ca’s VP of insurance.
Hands additionally noted that the cost pressures brought on by auto theft and fraud can make it “overall difficult for consumers to have choices and options for the best rates.”
“It goes without saying that fraud in the auto insurance industry hurts insurers, first and foremost, as they’re the ones footing the bill. But eventually, this trickles right down to customers in the form of a rate hike,” he said.
The growing intensity and frequency of natural disasters emerged as one of the significant challenges faced by the insurance industry this year, with Canada seeing record-breaking wildfires and flooding caused by storms.
Hands highlighted the possibility of the “domino effect” coming into the new year, warning consumers to be prepared for the inflation of home insurance premiums due to the large volume of claims brought on by recent catastrophes.
“Climate change, along with the natural disasters that follow, has hit the insurance industry hard,” said Hands. “And providers need to make this money back somewhere, leading to a rise in premiums for everyone.”
Meanwhile, RH Insurance director Morgan Roberts noted how vehicles have become more expensive to repair due to advanced technology.
Still, Roberts pointed to a bright side: that cars are being fixed quicker now and that inventory is “no longer as big of a concern.”
As for repair claims in home insurance, Roberts said fluctuating costs underscore why policyholders must review their coverage regularly.
“Most policies have guaranteed replacement value built in, which ensures you’re covered for the full cost of a rebuild, but some older properties may be missing the coverage,” she said.
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