By Chris Munro

April 4 - (The Insurer) - Redefining what peak perils are, getting a better understanding of accumulation risk, and prevention and mitigation efforts are three of the key issues facing Canada’s insurance market, Swiss Re executive Jolee Crosby has declared.

Speaking at Swiss Re’s 39th annual Canadian Insurance Outlook Breakfast on Thursday in Toronto, Crosby, who serves as CEO of reinsurance for Canada and the English Caribbean, said the industry needs to reconsider the impact of so-called secondary perils.

As Crosby highlighted, Canada was hit by record catastrophe losses in 2024 – estimated at more than C$8.5 billion ($6 billion) by CatIQ.

The bulk of that total came from four secondary peril events: a hailstorm in Calgary, the remnants of Hurricane Debby, a wildfire in Jasper, and severe flooding in southern Ontario.

“When I first came to Canada, and I was looking at the historical loss trends, if you’d told me you would have had an C$8 billion or C$9 billion year last year, I would say, ‘no way’.

“Because if you look at the history, while it has been going up, it has now gone to another level. And over the last three years, a C$1 billion event has become normal.”

Crosby highlighted that this trend is being seen worldwide too, with multiple smaller secondary peril events accounting for a larger share of losses.

“Now you have multiple $1 billion or $2 billion events that, from an accumulation perspective, is still the same amount as one large event.

“So we have to think differently about how peak perils are defined, because it's only through that that we can adjust and create a stronger, resilient insurance ecosystem for society.”

With increased urbanisation, Crosby said “it’s very important” the market gets a better understanding of accumulation risk otherwise it will continue to be surprised by bigger-than-expected loss events.

“Understanding all of that means that we can, again, have a stronger ecosystem,” she said.

The third key issue impacting the industry, Crosby highlighted, is around risk prevention.

“Prevention really reaps benefits so much when the event occurs,” Crosby stated.

“There’s a lot of good work going on at many of the individual (insurance) companies in terms of build-back-better prevention programmes, and we just need to continue to work on those,” she said.