Canada’s new government needs to focus on climate adaptation, says the industry’s association of property and casualty insurers.
“After an unprecedented year of heat and wildfires across much of Canada, climate adaptation must receive more attention in the coming months than it did during the election period,” the Insurance Bureau of Canada said Tuesday in a statement to Canadian Underwriter.
As of Wednesday morning, the results of Monday’s House of Commons election had yet to be confirmed. The Liberals were in a position to form the next government, the Canadian Press reported, albeit with only a minority of the 338 House of Commons seats.
There are still 24 close races where local postal ballots could decide the winners. As of Tuesday, the liberals were leading in 158 ridings while the Conservatives were leading in 119, CP reports.
“IBC congratulates all federal election candidates for running a fair campaign and the Liberal Party of Canada (LPC) for receiving a continued mandate for ambitious action on climate change,” IBC said Tuesday.
In a report released this past August, a working group of the Geneva-based Intergovernmental Panel on Climate Changed warned that global warming is likely to lead to an increase in fire weather in central North America, a region that includes much of British Columbia and Alberta.
In Climate Change 2021: the Physical Science Basis – IPCC’s sixth assessment report since 1990 – IPCC Working Group I concludes that emissions of greenhouse gases from human activities are responsible for about 1.1°C of warming since 1850-1900. Averaged over the next 20 years, global temperature is expected to reach or exceed 1.5°C of warming.
For a region the IPCC calls “eastern North America,” there is very likely to be increases in mean and extreme precipitation, the working group concluded.
During a Canadian federal election campaign speech this past August, Prime Minister Justin Trudeau promised a new auditing program so homeowners can assess their readiness to withstand extreme weather, CTV news reported at the time.
“IBC looks forward to continuing our strong partnership with the Government of Canada and is committed to accelerating work on a high-risk flood insurance pool and national adaptation strategy while encouraging more attention to future disasters such as earthquakes and pandemics,” IBC said Sept. 21 in a release.
Unlike the United States and Britain, Canada does not have a public-private partnership that subsidizes home flood insurance. Overland flood coverage was generally not available to Canadian homeowners until 2015.
Canada’s Task Force on Flood Insurance and Relocation was formed in late 2020. That task force’s goals include an actuarial analysis to assess the cost of insurance and funding model across viable insurance arrangements, and to assess viable flood insurance arrangement and measures to support potential re-location of those homes which are at the highest risk of repeat flooding, said Matthew Godsoe, director of the resilience and economics integration division at Public Safety Canada, during a webinar this past June hosted by Catastrophe Indices and Quantification Inc.
Craig Stewart, IBC’s vice-president of federal affairs, told Canadian Underwriter earlier he expects the flood task force to submit recommendations, to the federal public safety minister, in the spring of 2022. Stewart was interviewed this past February, five months before the election was called.
The task force is aiming is to have a “statement of fact report” in order to get a common understanding of flood exposure across country in a given year and look at different ways that Canada could create a low-cost insurance for residents at highest risk of flooding, Godsoe said during CatIQ Connect’s quarterly webinar this past June.
Another natural catastrophe concern for insurers is wildfire, which this past June caused an estimated $78 million in insured damage in Lytton, B.C., IBC said this past August, using an estimate on industry-wide insured losses from CatIQ.
Canada’s most expensive natural disaster, when measured by insured losses of nearly $4 billion, was the 2016 Fort McMurray, Alta. wildfire. In 2011, the Slave Lake, Alta. wildfire cost the industry $591 million, A.M. Best Company Inc. reported earlier.
Canada ranked third, behind the United States and Indonesia, in a Lloyd’s report listing the countries with the greatest amount of economic damage, from wildfire, from 1990 through 2012.
Feature image: A pyrocumulus cloud, also known as a fire cloud, produced by the Lytton Creek wildfire rises into the sky from the fire burning in the mountains above Lytton, B.C., on Sunday, August 15, 2021. THE CANADIAN PRESS/Darryl Dyck