Increased Frequency of Catastrophic Events

Canada’s climate change has led to a surge in extreme weather events, significantly impacting insurance claims. From 1983 to 2008, insurers paid an average of $400 million annually for catastrophic claims. Since 2009, this figure has skyrocketed to almost $2 billion per year.

This immense scale, driven by a slow-moving high-pressure system and a prolonged period of dry weather, led to multiple fires merging into a single massive complex fire, displacing over 20,000 people since early May.

In financial terms:

“By September 5, more than 6,132 fires had torched a staggering 16.5 million hectares of land. To put that in perspective, that’s an area larger than Greece and more than double the 1989 record.”

The 2025 Saskatchewan Wildfire Season

• The Damage: Nearly three million hectares (a massive area) burned across Saskatchewan, the largest burn area in decades for any Canadian province that year.
• The Evacuations: More than 20,000 people had to leave their homes quickly and were displaced.
• The Cause: The fires were fueled by extreme conditions, including a long stretch of very dry weather and a slow-moving, high-pressure system (a “heat dome”) that caused unusually high temperatures.
• The Fire’s Size: Several separate fires grew so rapidly that they merged into one giant fire complex. This huge blaze stretched about 200 kilometres long and 80 kilometres wide.[source]

Insurance Premiums and Cancelled Policies

The financial strain is particularly felt all over Canada, including the province of Saskatchewan. Research conducted by KPMG in Canada reveals that a significant number of Canadian small- and medium-sized businesses (SMBs) have been adversely affected by various natural disasters such as wildfires, storms, floods, and heat domes.

The report highlights worries regarding the increasing financial impact of weather-related calamities, which has led to a rise in the cost of business insurance, posing challenges for many business owners who are finding it difficult to obtain coverage.

Furthermore, while residential wildfire coverage remains widely available, the risk assessment landscape is changing: the increasing frequency of catastrophic losses means Canada is globally viewed as a higher-risk location for insurers, which directly impacts premiums and long-term affordability for homeowners and businesses alike.

Financial Impacts & Operational Resilience

Shipping companies in Canada know the weather challenges they face when operating in a vast country that spans nearly 10 million square kilometres, from the Pacific to the Arctic to the Atlantic. This includes both the immediate effects of short-term weather events, such as road closures and the shutdown of local supply chains, and the more significant impact of severe weather events that result in the destruction of supply warehouses and infrastructure.

The primary track of the Canadian National (CN) Rail in Jasper, which was temporarily stopped due to wildfires, has now recommenced its operations. Nevertheless, both CN Rail and Canadian Pacific Kansas City Limited (CPKC) rail systems still face the looming threat of wildfires. This persistent risk presents a potential obstacle for retailers who depend on these rail networks to transport their products.

This disruption risk is directly measurable: a September 2025 KPMG poll found that two-thirds of businesses now cite climate change as the biggest risk to their supply chains. This indicates an elevated and sustained threat to inventory and operational stability.

The ongoing wildfires and flooding problems in Canada present a constant threat that could potentially challenge retailers in terms of inventory management and product availability.

“The extreme weather events of the last couple of years have driven home the cost of climate change to the Canadian economy and the bottom line of individual businesses… devastating forest fires, floods, hurricanes, and extreme heat have impacted profitability for more than half of Canadian companies. Even those that escaped damage fear they will be hit this year – with over two-thirds being very or extremely concerned.”

Government & Industry Response

Since the threat of wildfires has grown significantly, Canadians need both governments and the private sector to continue putting money and effort into finding joint solutions.

To specifically address the rising financial losses from wildfires, the federal government, alongside provinces like Saskatchewan, has announced major investments.

• A combined $104-million investment was announced for the Resilient Communities through FireSmart (RCF) Program. The RCF provides funding to enhance wildland fire prevention and mitigation efforts.
• The Government of Saskatchewan announced a joint investment of over $44.8 million over five years in the RCF and the Fighting and Managing Wildfires in a Changing Climate Program Equipment Fund. The FMWCC supports strengthening wildland fire management capabilities by procuring specialized firefighting equipment.

Vulnerability Analysis of Assets and Operations

It is crucial to assess the vulnerability of your assets and operations to climate-related threats.

• Identify vulnerabilities: Pinpoint assets and operations most susceptible to climate-related risks (e.g., flooding, wildfires, extreme heat).
• Quantify potential losses: Estimate financial impacts of various climate scenarios to inform insurance coverage needs.

To address the emerging climate risks, it is advisable to broaden your insurance coverage by considering additional options suchp as: