Canadian Industrial Outlook: Insurance—Winter 2018
The Conference Board of Canada, 13 pages
April 5, 2018
This report examines the short-and medium-term economic and profitability outlook for Canada’s insurance industry.
- Interest Rates—Canadian interest rates will continue to rise until 2020, which will increase investment revenue for insurers. Although higher interest rates will lead to slower consumer spending on big-ticket, insurable goods, they are a net benefit to insurance carriers.
- Aging Population—Canada’s growing population of aging baby boomers will lead to a rise in death benefit claims in the coming years, sharply increasing costs within the life and health segment. Life insurers will thus be challenged to use the most cutting-edge technology to attract enough new enrollees from younger generations to maintain profits.
- Claims Processing—Processing of many claims is becoming more automated as insurance start-ups are using artificial intelligence programs to settle claims almost immediately. These small, tech-savvy firms continue to challenge large incumbents that rely primarily on legacy systems.