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How will the last year of weather events affect our insurance premium?

Premium increase

You will not be surprised if we tell you that 2017 was very particular as far as weather variations are concerned.  We experienced very cold weather this winter, then warm weather would cause snow to melt; not to mention the occasional abundant rainstorms from Mother Nature.

The consequences of these numerous temperature differences are: Flooding in some parts of the province and power outages in others, causing fires or water damage because the backflow pumps were no longer working. Not to mention the auto accidents brought on by bad road conditions.

In the spring of 2017, things got extreme. We had constant record-breaking rainfall, rapid snow melt and high water levels on the Great Lakes flooded hundreds of private properties and public infrastructure around Lake Ontario. That water would combine with the raging Ottawa River to cause far greater devastation in Quebec, where 5,371 homes were flooded.


The Insurance Bureau of Canada (IBC), through the Journal de l’Assurance, reveals that the difficult winter’s conditions cost insurers $54 million, including $33 million in Quebec. These are significant losses that will inevitably influence the assessment of risk pricing.

So you understand that, yes, storms and other natural disasters have an impact on everybody’s insurance premium.  They need to be considered along with other types of losses such as vehicle theft and road accidents when they are in large numbers.

Finally, climate change in the coming years is likely to cause even more headaches for insurers, according to an article in the Journal de l’Assurance: “If in the 1970s, there were only 60 events annually, there is now an average of 310 per year for the last ten years. Similarly, total insured losses from natural disasters increased despite the adjustment for inflation.