The State of the Canadian Market

Commercial insurance lines are continuing to harden in Canada and across the globe. As a result of this, there is pressure to tighten policy terms, increase deductibles, lower capacity on retaining accounts, and push higher rates.

Many Canadian brokers are experiencing a significant decrease in local market capacity, meaning there is a greater requirement to seek further capacity from Lloyds and London market. 

What lines have been hit the hardest?

While hardening conditions have impacted insurance as a whole, several commercial insurance lines have been hit the hardest. Many insurance sectors have seen rate increases of over 30% in the last year.

These insurance sectors include:

  • Design and Construction
  • Financial Sectors
  • Professional Indemnity – of any account size or capacity

There has been a significant increase in deductibles in various major business classes including:

  • Construction
  • Cyber
  • Financial Sector
  • Professional Indemnity Sector
  • Commercial Auto
  • Aviation
  • Casualty and Liability Lines
  • Property

While many individual insurers and brokers have exceptions to the rules (which businesses are within appetite and capacity), clear trends are surfacing in how the hard market has affected businesses.

Small to Medium-sized Canadian businesses are being targeted for increased rates across all lines. Larger businesses, or complicated and more challenging risks, are witnessing insurers becoming more selective in the capacity that they extend. Especially within the casualty, liability, construction, financial, or property sectors.

Canadian underwriters are purposely more, including cyber exclusions in policy wordings.

The types of financial line businesses that are suffering the most are:

  • Healthcare & long-term Care Facilities
  • Quebec-Domiciled Companies
  • Oil & Gas
  • Mining
  • Travel & Hospitality
  • Retail Industry

Canada's commercial property market has also seen significant changes. Insurers are making substantial changes in their policy wording and language, moving away from manuscript wordings. Again, there is an increase in policy exclusions for cyber and other exposures such as strikes, riots, civil commotion, business interruption, and communicable disease, most likely due to increases in protests, rioting, and political changes brought on via the pandemic's social, economic and political influences.

Due to this increased activity, local Canadian brokers are having difficulty receiving quotations due to a combination of capacity issues and high submission supply.

What can we expect from the hard market?

As the Canadian market continues to harden, what kind of challenges can we continue to expect:

  • Higher insurance premiums
  • Reduced capacity, which means insurance carriers write less insurance policies
  • Less competition among insurance carriers
  • More extensive restrictions within the wording / applied endorsements
  • Excess markets insurers are also cautious when following terms set by the primary insurer

How Servca can help?

As many brokers withdraw from London Market connections and capacity continues to decline, the reliance on having a Lloyds placement specialist like ourselves can be part of the solution. 

With our strong ties to the Lloyd's and London Markets and a great understanding of the Canadian market's challenging state, we have maintained a capacity for many of the risks struggling to be placed within Canada.

Servca can provide and maintain constant access to the Lloyd's of London Insurance market, leaving open a firm line between Canada and the UK and increasing capacity to place and better/more rates offered.

Our specialist broker team are highly experienced in some of the significant businesses' classes struggling to find placement within the Canadian market today, including:

  • Design and Construction
  • Financial Sectors
  • Professional Indemnity – of any account size or capacity
  • Cyber
  • Casualty and Liability Lines
  • Property

With avid knowledge, experience, and access to various insurers, we will be able to provide quality quotations with quick turnaround times, giving your clients options with reduced limitations direct from Lloyd's.

For more information on how we can assist you in these challenging times, please contact us at

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