The Canadian commercial insurance market faced challenges in 2024, and we must keep our priorities top of mind as we move into 2025.
Notable needs include attracting young professionals to the commercial insurance industry, which will continue to be a challenge in 2025. As an industry, we must do more to keep pace with growth and attrition, and double our efforts to recruit new talent and train existing talent quickly to take on bigger roles. Companies tapping into and leveraging global expertise and talent pools have an advantage in this area. In the commercial segment, expertise is particularly critical for all aspects of operations and long-term financial success.
A focus on culture adopted by many companies in 2024 must remain a top priority in 2025. That means open and honest communication, mutual respect, shared goals and transparency in all we do, and a commitment to employee growth and development. The right culture also means being comfortable and willing to adapt quickly to ongoing changes and always prioritizing our colleagues and their contributions ahead of job titles and hierarchy. This will lead to better customer service, higher customer and employee retention, and ultimately contribute to favorable financial results.
The industry collectively tackled approximately $7 billion in Canadian NatCat losses in the summer of 2024. This was dwarfed by U.S. hurricane damage. It’s an illustration of the worsening impact of climate change, and a reminder that all aspects of our underwriting processes must keep pace. Our industry’s claims response should become even more agile by resourcing teams effectively and evaluating, adjusting and settling these high volumes of losses as quickly as possible.
Some sectors in our industry have benefitted from lower inflation levels through 2024 and this trend should continue in 2025. With manageable inflation, businesses can better plan growth and future investment. If the 1.6% inflation rate posted in September 2024 holds, it could result in lower interest rates in Canada, which in turn should lead to more new housing starts and other forms of construction. For those commercial insurers who underwrite construction, all signs point to strong activity in 2025.
