Why Intact is seeing increased Cat loss ratios

Despite a relatively mild Cat quarter in 2025 Q2, Cat loss ratios for Canada’s largest insurer increased year-over-year.

Intact Financial Corporation’s (IFC) personal property Cat loss ratio for Canada increased to 6% in 2025 Q2 from 1.4% in the same quarter in 2024, says the insurer’s Management’s Discussion and Analysis (MD&A) released Wednesday alongside Intact’s latest financial results. For the first half of 2025, the Canadian Cat loss ratio rose even further, from 0.7% in 2024 H1 to 6.7% in 2025 H1.

However, IFC’s Cat loss ratio for its Canadian underwriting segment was only up to 2.3% in 2025 Q2, from 1.1% in 2024 Q2. It was up 1.8 points for the first half of 2025 to 2.6%.

For the company as whole, the “catastrophe loss ratio of 2.4% was low for a second quarter, but increased year-over-year due to weather events in Ontario and Québec as well as large commercial fires,” IFC chief financial officer Ken Anderson says in an online performance review presentation.  

Although the MD&A doesn’t specifically name the weather events or timeframe, flooding in the two provinces was significant in the third quarter of 2024.

The lion’s share of last year’s record-breaking $9 billion in insured losses was due to four major summer Cats. One storm involved flooding in southern Ontario on Jul. 15-16, 2024, which caused $899 million in insured damage, Catastrophe Indices and Quantification Inc. reported one-year post-event. The second was flooding in Quebec from the remnants of Hurricane Debby, which caused more than $2.5 billion in insured damage.

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In the second quarter of 2025, major claims could come from the late-March Ontario/Quebec ice storm and July 2025 flooding in Quebec.

“We did not experience significant Cat losses in the quarter, but our business is well-positioned to help our customers deal with the deep trend of increased natural disasters,” adds IFC CEO Charles Brindamour in a press release.

“Given the elevated level of weather- and climate-related claims over the past few years, we expect current hard market conditions to persist,” Brindamour adds during the 2025 Q2 earnings call.

For Canada as a whole, 2025 Q2’s combined ratio dropped 1.6 points to 83.8% from 85.4% a year ago. Operating direct premiums written (DPW) were about $4.91 billion in the second quarter of 2025, up 8% from $4.56 billion in 2024 Q2.

By segment, personal auto DPW increased 11% in the latest quarter to $2.11 billion from $1.89 billion, “reflecting rate actions and 2% unit growth in hard market conditions,” the MD&A says. “Combined ratio was strong at 90.3% in a seasonably favourable quarter, reflecting continued underwriting discipline.”

Personal property DPW increased 10% to $1.28 billion from $1.16 billion a year ago, “primarily due to rates and unit growth in hard market conditions. Combined ratio remained strong at 84.5% despite increasing 6.5 points from last year, as the prior period had benign weather activity.”

Canadian commercial lines DPW increased slightly (1%) to $1.52 billion in 2025 Q2 from $1.51 billion in 2024 Q2. “Combined ratios were very strong at 74.0% for the quarter and 77.6% year-to-date, driven by robust underlying performance and favourable PYD.”

Jason Contant

Jason has been an award-winning journalist with Canadian Underwriter for more than a decade, including the past three years as associate editor and, before that, as digital editor for seven years.