Alberta under pressure from weather impact

Alberta under pressure from weather impact | Insurance Business Canada

Catastrophe & Flood

Alberta under pressure from weather impact

“Significant” insured damage was seen for a third straight year

Catastrophe & Flood

By
Mika Pangilinan

The cumulative damage caused by severe weather events in 2023 amounted to over $3.1 billion in insured losses, according to data from the Insurance Bureau of Canada (IBC) and Catastrophe Indices and Quantification Inc. (CatIQ).

Alberta was one of the places to feel most of this impact, as the toll on properties exceeded $330 million, while over $100 million was allocated to repair and replace vehicles affected by hail and floods.

Overall, the province has witnessed insured losses surpassing $4 billion since 2020, with more than $500 million directed toward insurance claims related to damaged vehicles.

“This was the third straight year in which the province saw significant insured damage from hail, wind and rain,” he said. “The costs associated with these devastating events are placing significant pressure on insurance premiums in the province.”

The pressure brought by severe weather is of particular concern to Alberta’s auto insurance market, which is set to be further strained by a rate cap introduced last November.

“It’s more important than ever that we redouble our efforts to better protect communities to help improve the affordability of insurance coverage moving forward,” said Sutherland.

Along with severe weather events, rising inflation and legal awards have been contributing to the mounting pressure on auto insurance premiums in Alberta.

The same study found that over $1.2 billion of the premiums paid by drivers went toward legal costs linked to insurance claims between 2018 and 2022.