Message from the Chair

The importance of talking about climate risk

Climate risk is perhaps the defining challenge of our time. Severe weather events, including flooding and wildfires are becoming the norm, with catastrophic losses affecting more individuals and communities every year.

In Canada, insurable losses have more than doubled every 5 to 10 years since the 1980s. And in the future, the frequency and severity of extreme weather events is expected to increase and insurable losses to rise further.

As an industry based on risk protection, we must pay attention. Risk is fundamentally changing and everything we have known to be true in the past – from pricing models, to regulatory frameworks, and operations – is expected to change.

This is a critical juncture for our industry, and there exist significant opportunities to help individuals and communities adapt to risk and build resilience.

For example, partnering with governments on all levels – municipal, provincial, and federal – can help ensure that our infrastructure, building codes, and bylaws take into account both short-term and long-term adaptation measures. We need to be better integrate our risk management expertise and share the knowledge our industry has with our government partners – particularly when it comes to infrastructure. Resilience to climate change means adapting to our new climate risk reality – the increase in severe weather events adds urgency. We need to build in the right places, we need to build right the first time and we need to build back better when severe weather hits. By working with our government partners, and leveraging our strengths, we can help minimized the impacts of extreme weather events on the lives of Canadians.

The industry taking a stance

Over the years, the industry has taken a lead in the area of climate change. From the reinsurance community, which has been studying overall global climate losses (see Munich Re for example), to insurers such as The Co-operators supporting research on flooding, and Desjardins pledging to go carbon neutral, the industry is taking a stance.

At Intact, we established the Intact Centre on Climate Adaptation (Intact Centre) in 2015. Through applied research, the Intact Centre creates innovative, practical and cost-effective solutions to help reduce climate related risk for Canadians.

The industry’s support and dissemination of climate adaptation research to consumers – whether directly or through partners such as the Insurance Bureau of Canada, broker networks and MGAs – can have a big impact in the area of consumer preparedness.

At the same time, as an industry, we need to take a closer look at how climate change will affect the way we do business. This past November, Intact joined the United Nations Environmental Program Finance Initiative (UNEP FI). As part of that initiative, we are partnering with 18 of the world’s largest insurers (including Canadian insurers TD Insurance and The Co-operators) to figure out how to disclose the impacts of climate change in a more standardized and transparent way, and to better understand the impacts on our core products and services.

The CIP Society is on board

The CIP Society, as your professional association, has been bringing climate risk-related insurance issues to the forefront of our industry through our trends paper series. Over the years, we have looked at flood insurance and wildfires and discussed emergency preparedness.

And now this year, we are proud to announce that the latest report in our Emerging Issues Research Series will focus on climate risks and opportunities for Canada’s P&C insurance industry.

The report, which is due out in the fall of this year, will look at how property damage, investment value, operations, and the regulatory framework in Canada are expected to change in the upcoming decade. The report will also look at liability – who is responsible for climate risk – and the importance of doing the right thing at this critical juncture in order for insurance companies and brokers to maintain their reputations.

I believe it is our responsibility as insurance professionals to be at the forefront of the climate risk issue, to ensure we are working to help protect individuals, businesses and communities in Canada.

This is an important opportunity for us to stand together as an industry, and I hope the CIP Society can help us all rise to the occasion.



Mike Kosturik, BA, FCIP
Chair, National CIP Society