Canadian Industrial Outlook: Finance and Insurance—December 2019
This report examines the short-and medium-term economic and profitability outlook for Canada’s finance and insurance industry.
- Slower growth—After expanding by 1.9 per cent in 2018, economic growth in Canada is expected to remain modest in the medium term. Record levels of household debt and slower employment growth will dampen consumers’ ability to buy new homes, cars, or other big-ticket insurable items. Thus, industry growth is projected to be weaker than recent averages.
- Embracing open banking—The impending era of open banking will stimulate greater competition within Canada’s banking industry. Banks, to the extent that they can leverage consumer trust and adapt their financial offerings, should be well-positioned to manage this change.
- Insurance’s climate challenge—Canada’s property and casualty insurance industry faces a growing climate challenge amid rising catastrophic claims payouts. To mitigate these increasing risks, insurers will continue to ramp up investment in their modelling capabilities and leverage their data to help consumers become more resistant to climate-related events.