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7 June 2015 | Corporate

Corporate News

Prospects: Partly sunny

Canada is one of the wealthiest countries on earth and a popular destination for emigrants. But its thriving big cities, with their growing concentration of values, harbour risks for insurers. This was clearly illustrated by the extreme losses from weather-related natural catastrophes in 2013.

The second largest country in the world, covering an area of just under ten million square kilometres, Canada has always held a special attraction. Spectacular scenery and a wealth of mineral resources have drawn adventurers and explorers to its shores  from all over the world. Yet large swathes of its northern territory remain uninhabited, with the bulk of Canada’s population living in a 200 kilometre wide strip along the border with the USA and on the east and west coasts. The majority of Canada’s 35  million inhabitants live in cities in the southernmost part of the country.

Storm losses increasing

In terms of extreme weather, 2013 was remarkable for several reasons: floods in the province of Alberta and a severe storm over Canada’s biggest city, Toronto, proved to be the most expensive and the third most expensive losses in the country’s history. Both events occurred within a few weeks of one another in June and July, in the process setting another notable record: it was the first time that two natural catastrophes whose economic losses each exceeded the CAD 1.65bn mark (US$ 1.5bn) had occurred in the same year. Moreover, 2014 was the sixth year in succession in which insurers had to settle losses of over CAD 1m because of extreme weather events.

It is a trend that may well continue in the future. This is because the big cities, and therefore the concentration of values, will continue to grow substantially, in part because of the steady influx of immigrants. Over the course of its history, Canada has experienced several waves of immigration. Immigrants from Asia are the principal group today. They make up the bulk of new arrivals and in many places have left a lasting mark on their new country. The third largest Chinese community outside the People’s Republic has meanwhile developed in Vancouver, in the southwestern corner of British Columbia. Whereas nearly every fifth inhabitant (18%) was of Chinese origin in 2006, the figure in 2031 could be around 23%, according to a study commissioned by Citizenship and Immigration Canada. The stream of immigrants from Africa, the Caribbean, and Central and South America has also swollen over the years. According to the national statistics office, over 20% of the country’s population
was born abroad, the highest figure for any of the G7 member states.

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