TORONTO - Extreme weather events including flooding in Alberta and an ice storm that hit Ontario and Eastern Canada cost Canadian insurers a record $3.2 billion in losses last year, an industry group said on Monday.
The report by the Insurance Bureau of Canada (IBC), an umbrella group of Canadian property and casualty insurers, follows warnings from industry players that premiums will have to rise to cover a rising number of catastrophic claims events.
The bulk of the loss stemmed from June floods that shut down the oil industry hub of Calgary, Alberta, and decimated some smaller communities. That flood, which the IBC said was Canada's costliest natural disaster ever, cost insurers $1.74 billion.
A smaller flash flood in Toronto in July resulted in $940 million in damages, while an ice storm that hit Toronto and other parts of Ontario and Eastern Canada in December cost insurers $200 million in damage to homes, it said.
"Canadian communities are seeing more severe weather, especially more intense rainfall. This overburdens our sewer and stormwater infrastructure, resulting in more sewer backups in homes and businesses," Don Forgeron, Chief Executive of the IBC, said in the report.
The losses come in the wake of four straight years of natural disaster losses exceeding $1 billion, the group said.
Julie Dickson, head of the country's main financial services regulator, in September called 2013 and "annus horribilis" for the property and casualty insurance industry, citing the floods, as well as the derailment and explosion of an oil-laden train that killed nearly 50 people and destroyed part of the town of Lac Megantic, Quebec, in July.
In November, Intact Financial Corp the country's largest property and casualty insurer, said it expected to boost homeowners insurance premiums by between 15 and 20% in most provinces to deal with higher claims.