Commercial lines seen as growth opportunity, as personal lines firm up

Canadian property and casualty (P&C) insurance professionals are seeing a patchwork quilt of softening commercial specialty markets in multiple lines, with some — namely, directors and officers and cyber — being seen as beacons for growth.

With P&C insurers looking to grow their businesses following a period of market contraction during COVID-19, several sources agree commercial specialty lines offer opportunities to grow at a time when the personal lines market is hardening.

Brokers report competition for mid-market commercial businesses is white-hot. And while many talk about the impact of the U.S.-Canada trade war on rising claims costs, Canadian P&C professionals see tariffs creating opportunities for brokers in several areas, particularly construction.

“Certainly, we are seeing softening” overall, says Elizabeth Diotte, senior vice president of professional and financial solutions (Canada) at Tokio Marine. “I would say in certain lines of business, it’s more accelerated than others. And in certain characteristics of business lines, it’s more accelerated than others.

“But we are on the downward cycle of the market after enjoying a good couple of years of a hardening market, in which we had lots of premium injection. That was very much needed for the profitability of this industry – and compounded somewhat by the pandemic.”

Canadian P&C insurers reported a combined profit of $4.13 billion last year, according to year-end data from the Office of the Superintendent of Financial Institutions. This, despite paying out a record-breaking $9.1 billion in catastrophe losses last year.

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“I am pleased to report that the industry was able to survive everything that Mother Nature could throw at Canada [in 2024],” Property and Casualty Insurance Compensation Corporation board chairman Dave Oakden announced at the organization’s annual general meeting in Toronto in April.

“Industry-wide return on equity in 2024 was 15.1%, virtually the same as that in 2023. Some 149 insurers reported profits in both years.

“On balance, and in spite of the numerous catastrophic losses, 2024 was a good year for the industry.”

This article is excerpted from one that appeared in the August-September, 2025 print edition of Canadian Underwriter.

David Gambrill

David has twice served as Canadian Underwriter’s senior editor, both from 2005 to 2012, and again from 2017 to the present.