The commercial insurance landscape in Atlantic Canada is no stranger to change – with disruption shaped by economic shifts, climate-related risks, and supply chain challenges. As industries adapt to these changes, brokers play a critical role in helping businesses mitigate risk and secure appropriate coverage – especially where unpredictable weather is concerned.
Data from IBC found that severe weather events caused millions in insured damage in Atlantic Canada in 2023, with Hurricane Fiona in 2022 alone resulting in $800 million+ in claims.
"In the winter months, we haven't seen as much precipitation – it’s still cold, but it’s getting milder. We’re used to unpredictability," Denis Landry (pictured), a commercial insurance broker and client executive at Wilson Insurance, told Insurance Business. "However, in the fall and summer months, we're seeing flooding, forest fires, and hurricanes that are being a little bit more detrimental to local businesses and to our environment.
"We weren’t ready for the recent events that happened, and the losses that have occurred to properties, homes, and commercial businesses have been substantial,” Landry said. “We’re finding ourselves in bigger losses and trying to find better ways to mitigate the risks. It’s our responsibility to stay on top of the news, talk with underwriters, claims departments, and restoration companies, and walk through a loss – whether we were there or not – to understand the economic impact on businesses. We want to prepare for these events as if they were going to happen again."
Atlantic Canada’s economic profile differs from other regions in Canada, which impacts how businesses operate and how insurers assess risk – so much so that IBC found that coastal and flood-prone areas have seen property insurance premiums increase between 20-25%, with higher deductibles and coverage restrictions.
"Local businesses here are not as strong economically as, say, Alberta, Vancouver, BC, Ontario, or Quebec. So we’re finding other ways to make up for revenues," Landry said. "Landscapers will do snow removal in the winter. Even road construction companies will do snow removal. General contracting will do snow removal. It’s a big source of income, and it’s very common over here."
However, insurers outside of the region often struggle to understand these diversified business models. "Underwriters tend to be reluctant to write that type of business, mainly because they're not located here on the East Coast,” Landry said. “So when we get an underwriter from the eastern provinces, they're not used to how diversified one business can be. They’re not used to running that liability exposure."
And the region’s economy is heavily reliant on forestry and fishing – both industries facing unique risks. The fishing and seafood industry generates approximately $8.5 billion in economic activity across Atlantic Canada annually, employing over 45,000 people. Forestry contributes $4.5 billion annually to Atlantic Canada’s economy and employs 22,000 people in the sector.
"The main economy over here is wood milling and processing products. I’d say 85 to 90% of New Brunswick’s landmass is all wood products. It’s big manufacturing over here," Landry said. "Then there’s fishing. The fishing industry is a vast economic provider on this side of the country. With losses in fishing and fish plants, those are massive losses – $10 million each."
Recent workforce shortages have also forced businesses to find new ways to remain operational. "With the lack of workforce, we're hiring more newcomers and immigrants who are willing to work,” Landry said. “They’re more reliable, and we can afford them at a lower rate than local workers. We’re finding new, innovative ways to make up for that lack of labour."
When disaster strikes, the ripple effects extend far beyond the initial damage. The fishing industry, in particular, faces significant challenges when a plant is lost.
"Take the local village of Cap-Pelé – it’s the capital of smokehouses for fish plants. There are more smokehouses per capita in that small town than in any other village or city across the world," Landry said. "The process of smoking fish involves starting a small fire and hanging the fish. Now, there are probably 45 different smokehouses in that small village. If you lose one or five of those plants, you’re also losing all your employees – families that are contributing to the economic growth of that village, town, and province."
The loss of a single fish plant can have devastating effects. Fisheries and Oceans Canada estimates that one plant closure can cause the loss of 200-400 direct jobs, with each direct job loss in a fish plant affecting an additional 1.5 to 2 jobs in related sectors such as transportation, equipment supply, and local retail.
“We’ve seen $10 million worth of losses, and that means two to three hundred employees are out of work,” Landry said. “They can’t provide for their families, and they can’t go shopping because they have no income."
To mitigate such risks, Landry and his team work with businesses to develop backup plans. "We ask them: Do you have a third-party storage area with a cooling system? Do you have another supplier or brokerage that can take your product and move it faster to your end buyer? If your building is too close to the water, do you have another separate location to continue operations during downtime? What does your risk management program look like?"
Businesses must consider infrastructure changes to improve resilience, Landry said. "Do you have an emergency system to evacuate staff safely? Do you have a backup power grid? If your property is too low near a body of water, do we need to raise it? What’s the cost associated with that, and how can you make that money back?"
The past five years have seen major supply chain disruptions, affecting the forestry and fishing industries. These challenges have, in turn, influenced how businesses approach insurance.
"In the forestry sector, major companies are creating mobile setups," Landry said. "If your equipment is permanently fastened to the ground or to the buildings, and a catastrophic loss happens, you’ll have to rebuild from scratch, find loans or government grants to start up again."
To counter this risk, businesses are adopting more flexible operations. "We’re finding more and more companies becoming mobile so they can pick up and move. If they’re in a high-hazard area or a target for natural disasters like forest fires, they can relocate and continue operations."
In the fishing industry, maintaining product integrity is crucial. "If something happens and that volume of stock may go bad in a certain period of time, depending on temperature control, businesses need a backup generator or another power source to keep things refrigerated," Landry said.
With the rise of artificial intelligence, some in the insurance industry fear that brokers may become obsolete. Landry, however, sees things differently.
"Brokers are feeling the threat of AI taking over our jobs, but I think a broker can never be replaced," he said. "We are the boots on the ground. We have to tell the story to the underwriters and carriers on behalf of our clients."
That said, technology is playing an increasingly important role in communication and data analysis. "The speed of communicating a story or submission is more important than ever. More pictures, more videos, more analytics on loss control or claims – it’s crucial," Landry said.
Clients also expect immediate access to information. "With the new generation coming up, they want everything right away,” he said. “They don’t want to wait for a report – they want a FaceTime call, a video, a graph showing loss analytics in their area.
“You’re not just buying insurance – you’re buying service. And now, more than ever, they need to understand the value of what they’re paying for. Can you deliver information on time? Can you visually show them what you’re talking about?"
