Risk & Business Magazine Knight Archer Insurance Spring 2017 | Page 30

INSURED LOSSES
WATER DAMAGE
BY: CHALEN SCHNEIDER,
KNIGHT ARCHER
INSURANCE BROKERS
DID YOU KNOW?
OF ALL OF THE PROVINCES, ALBERTA HAS HAD THE HIGHEST
INSURED CATASTROPHIC LOSSES SINCE THE INCEPTION
OF PROPERTY CLAIM SERVICES’ FULL-YEAR REVIEW.
IN TOTAL, ALBERTA HAS EXPERIENCED $9.9 BILLION IN
LOSSES FROM 17 CATASTROPHIC EVENTS—THE LARGEST
LOSS BEING THE 2016 FORT MCMURRAY WILDFIRES.
Insured Losses
I
Catastrophic Events Reached $4.9 Billion in 2016
n insurance, a catastrophic event is
one that is typically unpredictable
and causes extreme loss.
Catastrophic events can be either
natural or man-made disasters, and
common examples include earthquakes,
floods, hurricanes, wildfires and terrorist
attacks.
According to a review conducted by
Property Claim Services (PCS), insured
losses from catastrophic events in Canada
reached about $4.9 billion last year, which
is nearly 10 times more severe than 2015.
When these events occur, they have a
heavy impact on the market—often
driving up premiums.
The report—“More Than 50 Cats: PCS
Full-Year 2016 Catastrophe Review”—also
found that, over the past five years, the
30
average insured loss from a catastrophic
event was $2.1 billion. During this time
frame, the two largest events on record in
Canada were the 2013 Alberta floods ($1.7
billion) and last year’s Fort McMurray
wildfires ($4 billion).
Six of the 2016 catastrophic events that
occurred in Canada were in the “wind
and thunderstorm” family and resulted in
industry losses of nearly $860 million.
Furthermore, the report noted that the
increase in catastrophic events had an
impact on reported personal losses. In
2015—a quiet year for catastrophic
losses—personal losses accounted for only
45 per cent of the insured loss estimate. In
2016, personal losses accounted for 71 per
cent of the insured loss estimate.
Moving forward, there is a possibility that
major, catastrophic events will increase
in frequency and severity, making it all
the more important for insurers and
businesses to stay ahead of the game. In
2017, many insurance companies will
be looking to advance their tools and
share best practices for assessing and
responding to catastrophic disasters,
whether natural or man-made. For
more information on the market forces
impacting insurance premiums, contact
Knight Archer Insurance Ltd. today. +
Chalen is a 16 - year veteran insurance
professional who has provided valuable
risk and insurance advice to the
Education, Government, Construction
and Transportation sectors.