Why more foreign insurers are looking to set up base in Canada

The current geopolitical environment means more foreign insurance companies are looking to set up base in Canada, a P&C insurance industry veteran tells Canadian Underwriter in an interview.

“What we’ve noticed is…there’s more interest [for] foreign insurance companies to establish themselves in a safe geopolitical environment,” says Klaus Navarrete, managing director and chief agent with HDI Global SE Canada. “I don’t foresee it’s going to change quickly.

“We actually see there’s an increased interest of foreign insurance companies setting up operations in Canada because of that [geopolitical environment], especially from Southeast Asia,” Navarrete says.

The geopolitical environment includes factors such as tariffs and global trade disputes.

The setting up of foreign insurance companies is good for consumers because it provides more choice. The downside is it puts more pressure on terms and conditions overall, Navarrete says.

“Canada has always been a…fairly stable country,” he adds. “That usually attracts attention from within the insurance industry.

“So, I wouldn’t be surprised if we see new insurance carriers applying for licences.”

In commercial lines, more capacity is coming into the Canadian market, Navarrete says. “There’s more capacity out there than needed; that usually results in rate pressure.”

When it comes to U.S. tariffs, some companies in Canada and around the world are looking to diversify their operations overseas. Navarrete cites the example of the marine line of business, in which fewer goods are currently hauled into the U.S. market due to tariffs. At the same time, there’s an increase in exports via vessels to overseas markets, he says.

“So, while you lose market share in one place, there are many opportunities to increase trade overseas. I think you’re going to see that trend continue to happen, even more so next year.”

Navarrete adds there is always a lag time between changes in the economy and trade opportunities. “You cannot just change your business model overnight, so it takes time,” he says.

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On the downside, he also expects more insolvencies in 2026.

Navarrete spoke with CU about his insurance predictions for the commercial property and casualty insurance space in 2026.

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.