The sizable and rapid growth of the program insurance sector in North America has prompted a focus on the Canadian market where an abundance of niche opportunities are emerging for Munich Re Specialty. The firm’s Head of Canada Programs Robin Udhwan and President of North America Insurance Programs Claudia Carnevale talk to Program Manager about the key Canadian market trends and how the firm is capitalizing on the opportunity. 

In a relatively brief period, the US program sector has become one of the fastest-growing areas across the insurance industry. According to the Target Markets Program Administrators Association’s State of Program Business Study 2025, the volume of the program business market reached $110.8 billion in 2024 in the US, up from $79 billion in 2022.

While the size of program business increased by 40% between 2022 and 2024, growth in direct premiums earned for commercial P&C lines rose by only 21.3% over this period, according to the same study. 

Now, focus is turning north.

Munich Re Specialty’s Udhwan explained the Canadian market has been slightly cyclical in recent years with focus on “top and/or bottom line” based on market conditions, but overall, for the preceding five or six years, the market’s journey “mirrors where the US is at” in some ways. 

“Canada is growing quite rapidly at a similar pace. Many new MGAs are coming in. Companies are realizing this is a profitable area to be in and the MGA space is the place to really focus their attention.”

Equally, Carnevale noted the double-digit growth experienced in the US and Canada in recent years means there is now “more of an appetite” for the program space in Canada. 

Munich Re Specialty stressing its focus on the Canadian program space stems from its broad appetite for risk and focus on niche and integrated products and programs. 

In managing niche opportunities, Udhwan explained what sets the program space apart is the increased need to understand the diversity of the space.

“The portfolio comes with all sorts of different sizes of accounts, different exposures within a single line of business,” he said.

Our strategy and talent has allowed us to look at and write some niche products such as construction, professional liability, errors and omissions, and directors’ and officers’ insurance, all of which “need specialization.”

“Other specialty products in the market are insuring golf courses, equine exposures, sports, and leisure [exposures], which brings a whole different bucket of risk exposures,” Udhwan said. 

Alongside the positivity in the market, certain trends are emerging that will undoubtedly impact future development. 

The market is soft, adding that this fact brings its own set of challenges.

The softening can be attributed to a variety of reasons, such as capacity provided by the Lloyd’s market, which has also been cyclical in nature in Canada in recent years.

“New MGAs that are trying to create their space in the Canadian environment tend to go to Lloyd’s for better pricing and for capacity that local markets may not offer to a new MGA.”

Udhwan also cited the impact of recent opioid litigation in British Columbia as a trend to watch. In November 2024, the Supreme Court certified British Columbia’s class-action lawsuit against opioid manufacturers and distributors, which will impact insurers via claims to be potentially paid.

“This teaches us Canadian underwriters to always keep in mind the long-term tail in casualty and the impact thereof. Multiple discussions are underway on reserving needs arising from such verdicts,” he said. 

“Different companies’ approaches on setting claims reserves in such matters are now under discussion.” 

Carnevale explained while the Canadian program space may not experience the same extent of growth that is being experienced in the US, the moving of MGAs into the middle market segment and the advent of digitalization and AI indicate future opportunities both in the US and Canada.

“In the US, when I'm talking to some of the larger MGAs, they are looking for expansion not only in products, but also in territories,” notes Carnevale. “They're investing or starting to look into some cross-border expansion opportunities and that plays very well into our strategy of diversification within all of North America.”

Furthermore, Carnevale described Canada as a “very compelling marketplace” that complements Munich Re Specialty’s US interests.

“That's why we're strengthening our leadership presence [in Canada], and we're looking for long-term partnerships and long-term growth.”

In Canada, the niche opportunities and market dynamics indicate the space is one to watch.