Insurance companies in Canada see record-breaking, $3.2-billion severe weather insured loss in 2013: IBC

The $3.2 billion in insured losses from severe weather represents the highest ever in Canadian history, the Insurance Bureau of Canada (IBC) reports.

The late-year ice storm – which wreaked havoc on parts of southern Ontario and eastern Canada – generated an estimated $200 million in insured losses and was enough to push the annual total for severe weather to a record high.

The new record – data about insured damage is from PCS-Canada – follows four consecutive years of natural disaster losses for the insurance industry that hit the $1-billion mark.

“In 2013, the terrible effects of the new weather extremes hit Canadians hard” and the “bad weather hit insurers hard, too,” IBC president and CEO Don Forgeron says in the statement. Some of the largest events include the following:

* the first most expensive severe weather event was the torrential rainfall that flooded towns in southern Alberta last June, with insured damage of more than $1.74 billion;

* the second most costly was the record rainfall last July that caused flash flooding in Toronto, resulting in about $940 million in damages;

* the December ice storms in southern Ontario and eastern Canada spurred $200 million in claims, most of which was for homes damaged by trees that fell as a result of ice build-up (Ontario-based insurers also paid more than $25 million in claims for vehicles damaged);

* the severe thunderstorm last July that hit central and southern Ontario and southwest Quebec, causing about $200 million in damage; and

* a band of powerful thunderstorms that hit Quebec and Ontario in June, producing damage amounting to more than $50 million.

“Canadian communities are seeing more severe weather, especially more intense rainfall. This overburdens our sewer and stormwater infrastructure, resulting in more sewer back-ups in homes and businesses,” Forgeron says. “Property and casualty insurers are collaborating with all three levels of government to help Canadians adapt to these new weather realities,” he adds.

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For example, IBC has unveiled a new predictive tool for municipalities – MRAT, or municipal risk assessment tool – to help them pinpoint vulnerabilities in their sewer and stormwater infrastructure. These weaknesses could lead to costly sewer back-ups and basement flooding, IBC reports.

MRAT was launched in November as a pilot project in partnership with three municipalities – Coquitlam, B.C., Fredericton, N.B., and Hamilton, Ont.