Insurance premiums rise due to weather risks and profit margins

Insurance premiums in Canada and the United States are rising significantly, driven by both increasing environmental risks and shifts in corporate profit models.

In Canada, experts warn that severe weather, including wildfires and flooding, is driving up costs. The Insurance Bureau of Canada reported that the 2025 wildfire season resulted in over $8 billion in insured damage across the country. In Saskatchewan, a single hailstorm in Regina was expected to exceed $80 million in costs. Consequently, premiums in Canada have roughly doubled over the last decade, often increasing faster than inflation. Experts note that traditional insurance models, which rely on historical data, are becoming less effective due to climate change and aging infrastructure.

In the United States, an investigation by More Perfect Union suggests that while worsening disaster risks contribute to higher costs, insurers are also retaining a larger share of customer premiums. The investigation argues that a smaller portion of paid premiums is being returned as claims, allowing companies to protect their margins even as coverage becomes less affordable for households.