Aviva Canada reports escalating NatCats during first half of 2025

Aviva Canada’s CEO says the company has seen a busier natural catastrophe season in the first half of this year compared to last year.

“It’s been a really active Cat season. We’ve had seven major events in 2025 at the half-year,” Nav Dhillon, Aviva Canada CEO, said in a call with Canadian Underwriter to discuss the company’s half-year results. “In comparison, it was two at the start of the first half of the year,” he said of the Cats the company specifically has handled.

Catastrophe Indices and Quantification Inc. (CatIQ) has confirmed Canada’s entire P&C insurance industry has responded to 12 natural catastrophe losses so far in 2025 (events causing more than $30 million in insured damage), with four of those being wildfire events.

Dhillon says wildfires are top of mind, with fires out of control and threatening properties in B.C., Alberta, Saskatchewan, Manitoba, Ontario, Nova Scotia, New Brunswick, and Newfoundland and Labrador.

Canadian Interagency Forest Fire Centre (CIFFC) reports more than 7.5-million hectares have burned in Canada thus far in 2025 — more than double the 3.6-million hectares that burned this time last year.

Natural Resources Canada notes 2023 wildfires set a record in Canada for most hectares burned. At this same time in 2023, CIFFC reported 5,691 fires to date and more than 12-million hectares burned. In total, more than 18.5 million hectares burned in 2023, CIFFC reports.

Aviva plc’s 2025 half-year financial report notes the company’s risk modelling takes the increasing impact of climate change into account. Despite the first-half Cat losses in Canada, Aviva Canada reported a healthy, undiscounted combined operating ratio (COR) of 94.7% and gross written premium growth of 4%.

But Aviva plc’s report also sounds the alarm about the long-term financial impact of escalating NatCat loss events.

“Notwithstanding that the impact [of NatCats] on general insurance liabilities is mitigated by the short-term nature of the business, the ability to reprice annually, and by the company’s reinsurance programs, the physical effects of climate change will most likely result in more risks and perils becoming either uninsurable or unaffordable over the longer term and the need for more urgent action increases.”

Also in the news: ‘Waiting game’: P&C industry stands by as Newfoundland wildfires rage

Canada’s P&C industry has been calling for Canadians to “build back better” after Cat losses, meaning new rebuilds must incorporate features more resistant to weather-related damage. This is what the industry calls a “whole of society” approach, meaning there’s only so much the insurance industry can do by itself. Politicians at all levels, developers, plus industry professionals in the banking, mortgage, construction and other sectors, all need to work together to promote climate resilience and adaptation, Insurance Bureau of Canada has noted.

Two years ago, the federal government introduced its National Adaptation Strategy in 2023, intended as a blueprint for building a more resilient Canada.

“While the National Adaptation Strategy is a great step forward, I think the investment and the implementation of it is slower than what we would have liked,” Dhillon tells CU. “If we’re going to make an impact at scale, we need to see ‘Build Back Better’ making its way into…codes and policy.”

Other positive initiatives are taking place, Dhillon adds. One is in Jasper, Alta., after a wildfire destroyed one-third of the town last year, causing $1.3 billion in insured damage.

“We thought this was encouraging progress, particularly in response to wildfires, that Jasper [has] new [building] guidelines to align to FireSmart recommendations,” Dhillon says. “So that, as they rebuild, they ensure the structures are built to be more resilient in the future.”

Aviva Canada is also funding a pilot project led by the Institute for Catastrophic Loss Reduction in Alberta.

In its ‘Climate-Ready Homes’ initiative, ICLR is working with the cities of Calgary and Edmonton to identify the most cost‑effective measures homeowners can take to protect their homes from climate-related risks such as hail, basement flooding, extreme heat, and wildfire smoke. The pilot project includes a partnership between ICLR and the Canadian Home Builders Association to pilot the use of resilience practices in new homes.  

“That’s something that we’re incredibly excited about, what that partnership could mean for customers,” Dhillon says.

In October 2022, the City of Calgary called for the introduction of an impact rating for asphalt shingles and enhancing installation requirements for roofing in Alberta.

“The proposed code change would address the impact of hail at a regional level and apply to the 2026 National Building Code cycle,” the City of Calgary announced.