Insured damage for severe weather events in Canada reached $1.3 billion in 2019, according to Catastrophe Indices and Quantification Inc. This wasn’t the result of one massive event. Rather it was a culmination of several costly winter storms in Ontario and eastern Canada, severe flooding in Quebec and New Brunswick, hailstorms out west in the summer months, and two fall windstorms in eastern Canada.
Upon releasing the data on insured damages for severe weather events in 2019, the Insurance Bureau of Canada (IBC) called for “all orders of government to increase their investments in mitigating the impact of extreme weather and in building resilience against the damaging effects of extreme weather events.” The organization seeks upgrades to public infrastructure and improvements to building codes and land-use planning.
Importantly, the IBC is “advocating for all stakeholders” to get involved in building more resilient communities across Canada. This is something that Swiss Re Canada president and CEO, Monica Ningen (pictured), also called for during a panel on resilience at the recent CatIQ Connect conference in Toronto.
“Across Canada, cities and towns are more susceptible than ever to flooding, wildfires, ice storms and other extreme weather hazards,” she said. “The IBC announced that the insured damage for severe weather events in Canada reached $1.3 billion in 2019. The reality is, the risks communities face from extreme weather is growing, and the cost of natural catastrophes is rising.
“Countries are more or less vulnerable to natural disaster risk according to their level of preparedness and their ability to absorb losses. We must take the steps necessary to protect Canada against the impact of severe weather. Some are costly from a financial standpoint, and some would require a complete change of the way that we live our lives. But we can’t afford not to make these changes. Anything done to mitigate and adapt natural catastrophe risk is a step in the right direction to ease the elevating burden of the economic future.”
Insurance and reinsurance are just one part of the solution to building a more resilient Canada. Like the IBC, Ningen stressed that all key stakeholders – public and private – must work together to co-develop and implement risk prevention, risk mitigation, and risk transfer.
“Build Back Better is a key component to building Canada’s long-term resiliency towards extreme weather events,” said Ningen. “From a risk prevention standpoint, building codes are the minimum standard that we should aspire to. Small changes have meaningful impacts. There also could be better mapping or data that enables a more strategic location when we rebuild our homes. What about roofs that are properly anchored to withstand high winds? Not all of these things are expensive.
“From a risk mitigation standpoint, according to the Economics of Climate Change Adaptation study, between 40% and 65% of economic losses can be diverted through cost-effective measures. Lastly, risk transfer - at some point, it’s no longer cost effective to adapt. There’s a range where risk transfer becomes an ideal solution.”
The Swiss Re Canada chief executive concluded by stating that everyone that catastrophes impact - consumers, private companies, brokerage companies, public companies – must “work together to build this resilient future that we dream about.”
