2025 Executive Outlook | T. Marshall Sadd, Navacord

Data suggests the hard Canadian insurance market started sometime in 2018, led by the energy and transportation sectors, before spreading across the industry. For us, that rating environment lasted until early 2024 when the commercial insurance market quickly softened.

As one of Canada’s largest commercial brokers in the mid-market space, we can see clearly into the changing market. Strong commercial underwriting results for carriers over the last few years, along with enhanced investment income returns and increased capacity from Lloyds and other new market entrants, have resulted in more demand than supply. This dynamic is resulting in preferred pricing and much better terms for clients, particularly in the mid-to-large account space.

Being an expert, advisor-centric business lets us proactively engage with clients to review coverages and limits and create an opportunity for upselling. By leveraging the evolving market conditions, we help clients capitalize on favorable changes and transfer more risk to their insurance partners.

In 2025, the change to a soft market will bring new industry challenges around talent training and development. It will require a different skillset to sustain success and meet client expectations. Many of our colleagues have only experienced a hard market or have limited exposure to this shifting environment. We’re addressing this from two fronts:

• Client management – by training client service teams and advisors to conduct more frequent client reviews, offer more options and provide clear understanding of the evolving market.
• Insurance partner management – by focusing on collaboration with our insurance partners to meet all stakeholders’ expectations and proactively identify potential issues or opportunities and take the appropriate action.

Experience suggests the industry must approach this phase with care. The past has shown us the consequences of following the cycle downward. To ensure stability and minimize volatility, we need to leverage our data and underwriting expertise to maintain discipline and provide a more thoughtful approach to the commercial insurance marketplace as clients demand greater predictability.