Wellness-driven growth and advanced risk maturity will drive better business strategies and help shape the future of the industry.
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What to Expect in 2026
Addressing ongoing workforce challenges will require hospitality operators to reshape their talent strategies while also managing budget pressures from rising labour and operational costs. Stricter risk management processes will help mitigate workplace violence exposures, cyber threats and natural catastrophes. Still, opportunities exist for organizations within the industry to gain a competitive edge by embracing consumer trends related to physical, financial and career wellness.
Profitability
Vitality
Resiliency
Wellness Hospitality and Tourism
Profitability
Consumer confidence declined in 2025 amid economic uncertainty and the impact of shifting tariff policies on the cost of goods and services.1 At the same time, industry observers seem to be cautiously optimistic about the hospitality industry overall. More than a quarter of Canadians changed their plans to travel to the U.S. in summer 2025 and chose to vacation inside Canada instead.2 As a result, Canadian hotel demand rose, with revenue per available room exceeding $200 for the first time on record.3
However, rising costs for goods and services have significantly affected profitability as operating expenses have increased. Additionally, hotels, lodging and restaurant owners have made necessary but expensive investments in technology and upgraded their properties. At the same time, labour costs have continued to grow, with minimum wage increases hitting provinces across the country.4 Rising labour and operating costs were noted as a top profitability concern for the hospitality industry, according to the HUB International 2026 Profitability & Resiliency Executive Survey.5
To offset pressure on profitability, technology can help lower operating costs and boost ROI. Adding new guest amenities to satisfy the growing demand for active, wellness-focused services that promote better mental and physical health creates another opportunity to boost profitability. In turn, these new services can be promoted affordably through social media and digital marketing campaigns that boost visibility and create excitement for future guests.
Technology and property investments can help offset rising business costs.
Though franchise operators are required to follow multi-year property upgrade plans per their franchise agreements and may see better insurance terms as a result, all hospitality operators can see improved coverage options and rates by performing strategic and cost-effective upgrades.
More than a quarter of Canadians changed their U.S. travel plans in summer 2025.2
Persistent labour shortages remain a major challenge for employers, despite consistent efforts to raise wages and adjust benefits models, even for part-time staff. Operating costs in the hospitality industry rose more than 16% — much of which came from salaries and wages.6
Labour gaps in Canada will be exacerbated by recent changes in immigration policy that have reduced the number of permanent and temporary resident admissions.7 With 7% of all immigrants arriving between 2016 and 2021 working in food service, the industry is likely to face additional labour shortfalls.8
Addressing worker mental health challenges, which directly affect performance, should be a priority of hospitality employers in the current environment. However, only 16% of employers currently believe health concerns are a top factor impacting productivity, according to HUB’s 2025 Canadian Workforce Vitality Gap Index. Fifty percent of employees indicated in the survey that they would utilize wellbeing programs, such as extended mental health benefits, gym memberships and yoga, if offered. This is an opportunity for employers to stand out from competitors with personalized benefits geared toward mental health and wellbeing.
In 2026, retention efforts should largely include an emphasis on career advancement opportunities, enhanced benefits like financial wellness programs, and establishing and cultivating a workplace culture in which employees feel valued and safe through mental health support and other wellbeing resources.
Given market conditions, hospitality operations that embrace a strategic approach to benefits and communicate those resources to employees will find themselves ahead in recruiting and retention.
HUB’s Workforce Persona AnalysisTM gives employers the ability to identify what benefits employees need — and want — by leveraging employee data and analytics.
Forward-thinking organizations are increasingly focused on stabilizing staffing through culture-building initiatives, financial health resources and benefits modernization. For example, hospitality businesses can integrate enhanced employee support strategies, such as tools that provide interactive coaching and wealth management advice to help meet a growing demand for employees looking to improve their financial wellbeing.
New culture-building initiatives and benefits options become more critical amidst labour shortages.
Vitality
Download our 2026 Hospitality Outlook and Insurance Market Rate Report to see what to expect in the coming year.
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The insurance landscape remains challenging for the hospitality industry, as several pervasive and rapidly changing threats have led insurers to enact stricter policy terms and underwriting practices.
One area of concern is the increase in workplace violence against hospitality workers, including those working in hotels and restaurants. In one well-publicized incident, a hotel worker was hospitalized after being targeted in a hate crime.9
This trend has resulted in tightened underwriting standards and carriers requiring documentation around risk management planning, workplace violence and harassment policies, and active shooter protocols. Hospitality employers should also ensure they have clear plans in place to help employees safely de-escalate aggressive customer situations, whether that involves contacting authorities, engaging security or designating a trained staff member to manage the interaction calmly.
A continued rise in natural catastrophe risks, especially in high-risk regions prone to excessive storm damage and flooding, have also complicated property insurance rates and policy availability. Hospitality operators taking steps to minimize losses associated with CAT events have more success at offsetting broader cost pressures.
Communicating with your broker about weather exposures like floods is another critical step, as they can identify appropriate coverage, including loss of business income.
With the increasing use of point-of-sale (POS) systems, mobile applications and artificial intelligence (AI), cyber risk across the industry has heightened as the sector remains a major target of cybercriminals.
In one high-profile example, sensitive data from millions of applicants was exposed through McDonald’s AI-powered hiring software,10 underscoring why strengthening cybersecurity and data privacy measures remains a critical priority.
Protecting restaurant operations in today’s technology-driven environment requires a layered approach to vendor management, internal protocols and staff readiness. Restaurants need to thoroughly vet third-party vendors and their software, paying close attention to contractual details such as liability, the right to audit and breach notification requirements.
Establishing strong internal protocols, such as training staff on how to use critical systems, preparing them for outages and running tabletop exercises for scenarios like POS failures or data breaches, will help ensure that business continuity can be maintained even under pressure.
Restaurants should work with their brokers to ensure they have the correct level of cyber insurance for breach response costs and access to expert support so they can recover quickly and reduce financial exposure. Cyber insurance rates remained flat or up slightly in Q4 of 2025, making it a good time to re-evaluate your cyber program, purchase additional coverage if needed and improve employee training protocols.
Addressing insurance challenges and safety hazards requires advanced risk maturity.
Resiliency
Demand across Canada for wellness-focused products, services and experiences is an area of growth for the hospitality sector that many operators are hoping to capitalize on to attract both new customers and long-term talent.
A significant post-pandemic rise in awareness around mental health and overall wellbeing turbocharged demand for “wellness tourism,” which can involve anything from providing access to healthy food options and spa treatments at hotels to hosting week-long meditation retreats. The Canadian wellness tourism market is growing quickly, with experts predicting revenue of more than US$80 billion by 2030.11
Demand is only expected to heat up, particularly among younger consumers, with hospitality brands adding and promoting new wellness-focused amenities and services to meet increased demand.
However, whether it’s a yoga studio or a guided hiking experience, hospitality operators must be mindful of liability, safety and regulatory exposures that come with expanding into wellness offerings and communicate any operational changes with their broker. For example, introducing fitness experiences can create greater liability burdens, as guests could get hurt due to defective equipment, inadequate supervision or poorly trained staff.
As for talent, demonstrating support for employee wellness is no longer merely beneficial but foundational to any hospitality
workforce strategies. To capture the younger generation of workers who remain attuned to work-life balance and tapped into viral wellness trends, organizations must increasingly reshape their company culture to address the full scope of employee wellbeing.
This includes offering benefits that support employees’ physical, mental and financial wellbeing, as well as demonstrating a path for promotion. Comprehensive, layered benefits, such as first-day minimum essential coverage for all employees, will help hospitality companies differentiate themselves in the competition for highly coveted workers.
Wellness-based services create new talent, business opportunities.
Wellness Hospitality and Tourism
HUB’s hospitality insurance, risk management and employee benefits specialists can help you develop a tailored insurance strategy that will protect the bottom line, support your workforce and build resiliency for 2026. Here are some initial considerations:
Moving Your Organization Forward
Economic uncertainty, natural catastrophes and technology exposures are making insurance more expensive. Consider alternative insurance options like parametric coverage and ask your HUB broker about devising an insurance strategy that meets your risk profile and budget.
Advance your risk maturity.
Develop a plan for regular budgeted investments to maintain your property and reduce exposure. Investing in windows and roofing that can withstand strong winds or adding water sensors throughout buildings demonstrates to underwriters your commitment to property management and safety.
Invest in your facilities.
It remains difficult for hospitality businesses to attract and retain employees. A benefits strategy based on personalization and fostering a quality employee experience (QEX) can boost engagement and give hospitality owners an advantage in recruiting and retention, as well as lower risk.
Increase workforce engagement through benefits.
Communicate any business changes with your broker so there are no surprises at renewal. Review exposures and insurance needs at least 90 days prior to policy renewal, so your broker can identify the best options.
Be transparent with your broker.
Download our 2026 Hospitality Outlook and Insurance Market Rate Report to see what to expect in the coming year.
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Meet the Experts
About Us
HUB Hospitality
When you partner with us, you’re at the centre of a vast network of experts who will help you reach your goals. For more information on how to manage your insurance costs, reduce your risk and take care of your employees, talk to a HUB Hospitality insurance specialist.
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insurance policies managed
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Technology and property investments can help offset rising business costs.
New culture-building initiatives and benefits options become more critical amidst labour shortages.
Addressing insurance challenges and safety hazards requires advanced risk maturity.
Wellness-based services create new talent, business opportunities.
Download Report
3. Stay: Canadian Hotel Intelligence, “Canada hotel RevPAR hits record high in August,” September 24, 2025.
4. CTV News, “Five provinces are raising minimum wage. Here’s what you need to know,” September 27, 2025.
1. Bank of Canada, “Canadian Survey of Consumer Expectations,” October 20, 2025.
2. CTV News, “Canadian tourism up 30 per cent as U.S. travel continues to decline: survey,” September 12, 2025.
5. The HUB International 2026 Profitability & Resiliency Executive Survey polled 350 industry leaders and executives across North America on the issues facing them on profitability and resilience.
6. Statistics Canada, “Accommodation services, 2023,” December 2, 2024.
7. CIC News, “2025 mid-year review: major immigration policies and changes implemented,” July 4, 2025.
8. Government of Canada, “Immigration matters in food services,” accessed October 18, 2025.
9. CBC, “Toronto man charged in ‘hate-motivated’ assault on hotel worker, police say,” October 8, 2025.
10. Wired, “McDonald’s AI Hiring Bot Exposed Millions of Applicants’ Data to Hackers,” July 9, 2025
11. Grand View Horizon, “Canada Wellness Tourism Market Size & Outlook, 2022-2030,” accessed October 19, 2025.
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Cyber insurance rates remained flat or up slightly in Q4 of 2025.
Hospitality operators must be mindful of liability, safety and regulatory exposures that come with expanding into wellness offerings and communicate changes with their broker.
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HOS-CAE
of employees say they would utilize wellbeing programs.
50%
Hospitality operators are contending with higher insurance rates for certain lines of coverage, including workplace violence and liquor liability, which has stabilized somewhat but remains higher for operations with greater risk like bars and nightclubs. There are some insurance bright spots, however, as property rates are softening or remaining stable in some Canadian markets with lower catastrophe risk. Operators in regions with exposure to wind or wildfire, such as Alberta, should still expect to face stricter underwriting and higher rates.