Amid Market Shifts and Rate Fluctuations, Signs of Stability Emerge
Some coverages that saw sharp increases in previous years—like select property risks, cyber and professional liability—are stabilizing, with flat to modestly lower renewal rates for well-managed risks.
Greater insurer competition is helping with rate stabilization, particularly in property insurance. Favourable reinsurance pricing is giving carriers more flexibility in underwriting. However, April and July reinsurance renewals will be pivotal in shaping market conditions for the rest of 2025.
What Impacted Rates in Q1?
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Based on proprietary insurance premium data, HUB’s network of experts provides insights into the state of the insurance marketplace each quarter. Download our Rate Report to receive detailed rate insights and learn how insurance rates may impact your total cost of risk.
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Despite severe weather and geopolitical uncertainty, some insurance rates declined in early 2025, especially for insureds with strong risk management programs and no claims. However, rate volatility remains, with increases in catastrophe-prone regions. Ongoing economic, litigation, and political challenges are also impacting lines like commercial auto and excess/umbrella liability.
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Insured losses from the 2024 wildfires in Jasper are estimated to total $1.23 billion, marking the second costliest wildfires in Alberta’s history.1 The events will put a strain on Canada’s property insurance markets, as will rising rebuilding costs, fueled by inflation and supply chain disruptions, which are prompting stricter underwriting and higher premiums in high-risk zones.
Wildfires and Rebuilding Costs
Capacity has improved in most segments, but insurers remain selective, prioritizing businesses with robust risk management and clean loss histories. High-exposure industries in catastrophe-prone areas may experience capacity challenges, however Canada is seen as a favourable insurance environment by many domestic and foreign insurers and reinsurers.
Tariffs, supply chain issues, and regulatory shifts in the U.S., Canada and Mexico are increasing claims costs and pricing uncertainty. Any significant legislative or regulatory changes, such as tariffs, could drive up replacement and rebuilding costs, particularly in areas vulnerable to catastrophes, which would impact property valuations and contribute to further pressure on property insurance rates.
Escalating legal costs and nuclear jury verdicts are driving up some liability insurance rates. Commercial auto, umbrella and professional liability remain most affected, with insurers tightening terms and raising deductibles.
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Market Volatility, Economic Uncertainty and Legislative Changes
Insurance Capacity
Increased Litigation Exposure
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Overall, the insurance market remains highly fluid, with further changes in pricing and coverage availability expected in the months ahead. Organizations with proactive risk management and strong loss control are securing the most favorable rates and coverage terms. A strategic enterprise risk management (ERM) approach helps businesses mitigate claims, improve insurability and navigate market fluctuations with confidence. 1 Artemis, “CatIQ raises Jasper, Canada wildfire insured loss estimate to C$1.23bn,” Jan. 27, 2025.
Competition and Strong Risk Management Fuel Rate Improvements
Q1 Rate Report
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