Environment Committee on Dec. 8th, 2025

[Patrick Bonin, Bloc, Repentigny, QC]

I assume you're also of the view that there's a connection between climate change and greenhouse gas emissions from fossil fuels.

[David Leibl]

That's right, but to whatever you would attribute the cause, we're certainly seeing a clear trend line towards more frequent and severe weather events that are driving up the cost of insurance and claims.

[Patrick Bonin, Bloc, Repentigny, QC]

We often hear about insurance companies insuring new fossil fuel projects. Does it make sense to you that insurance companies do that but then say that the damage caused by climate change is costing them more?

[David Leibl]

I think it's a very fair question. I would say that, for us as an insurance company, we want to be partners in funding a transition. We recognize the global climate around energy and Canada's own ambitions around energy needs and energy independence. We need to be mindful of that as an insurance company.

We think there's room for both. Certainly, as an individual insurer, we have a growing allocation of our invested assets in what we call impact investments. Are we still partners in insuring the energy industry? Yes, we are, very much. I would say that we and other insurers are very much on a journey and mindful of the broader geopolitical climate.

[Patrick Bonin, Bloc, Repentigny, QC]

For the sake of consistency, do you think insurance companies should have transition plans in line with the Paris targets?

[David Leibl]

Some of this is prescribed to us. Insurance companies are federally regulated by OSFI, our federal superintendent of insurance. There's legislation to which we must align and report on some of these issues specific to addressing climate risks and documenting how these risks impact our own business and that of our...we call them “members” as mutual policyholders, and mitigating opportunities.

[Patrick Bonin, Bloc, Repentigny, QC]

I know it's not prescribed, but for the sake of consistency and regardless of what the government requires, do you think insurance companies should have transition plans in line with the Paris agreement?

[Mitchell McEwen]

Our focus as an insurer is on physical risks such as wildfires, hail, flood and extreme heat, which of course effectively direct our—

[Patrick Bonin, Bloc, Repentigny, QC]

Sorry to interrupt, but I'd like a yes or no answer. Should insurers have transition plans in line with the Paris agreement?

[Mitchell McEwen]

Canada needs stronger resilience and recovery systems to protect people from extreme weather.

[Patrick Bonin, Bloc, Repentigny, QC]

Do they have to have transition plans, yes or no?

[Mitchell McEwen]

Under our regulator, our guidance from OSFI is that yes, we need a transition plan.

[The Chair, Liberal, Angelo Iacono]

Thank you.

Is there a last remark?

[David Leibl]

I'll very briefly respond, if I might.

There is no insurer in Canada that is immune to these challenges. It is a hockey stick curve. Last year was a significant.... We've all heard the $9-billion figure. Interestingly, this year, at least from an insured loss perspective, was not a bad year, yet the human hardship, the disruption, was profound across our country.

Every insurer is invested in this. Every insurer is at a different point along their journey through our partners at the Insurance Bureau of Canada. You heard from Paul Kovacs this morning. There's work we're doing collectively, but I don't think there's an insurer in Canada right now that doesn't have some plan, because this impacts their own futures so significantly.

Thanks very much.

[The Chair, Liberal, Angelo Iacono]

Mr. Ross, the floor is yours for five minutes.

[Ellis Ross, Conservative, Skeena—Bulkley Valley, BC]

Thank you, Mr. Chair.

There are a number of us here who are brand new MPs, but in my previous life I actually dealt with this as an MLA for the provincial legislature in B.C., as well as a chief councillor back in my small native village in B.C. It was Mr. Leibl or Mr. McEwen who put it best. We need a whole-of-society approach.

Just looking at this list, we're talking about individual responsibility, health, vulnerability and zoning; we're talking about provincial alignment across all of the ministries, mining and forestry; and we're talking about relocation issues. We're talking about the devaluation of properties. We're talking about the cost to the taxpayer, whether we're talking about a failed model in the United States or the DFAA program in Canada, which could be offset by the topic that we're talking about here today.

However, we haven't even begun to talk about the larger range of issues that have to fall under this umbrella. We're not talking about the transboundary agreement, for example, that caused the flooding in Abbotsford. We're not talking about dams and their role in managing floods.

It's not just your round of panel discussion. The panel before you emphasized that this work is already done. It's already been documented extensively over the last 10 years. All we need now is government action.

I will turn to Mr. Leibl, I suppose, to ask, where would the government provide its best effort in kick-starting this process, which covers a lot of different sectors?

[David Leibl]

I appreciate that you've laid out the business case for government investment and leadership in this area more eloquently than I could. As a leader who has held previous roles prior to joining this table or the House, you would know well that it's smaller municipalities and local leaders who are often on the front lines of this issue. They're closest to their constituents. They are the ones who see at a ground level the impacts on families, often people they know, members of their community and their neighbours. It's also these same communities where leaders have the fewest resources; the infrastructure simply isn't there.

Canada is fortunate, in my view, in that we have had such strong ambassadorship and local leadership from municipalities. Part of the reason is that they are on the front lines of this issue and they're hearing it from their residents. You've laid out a clear business case for the need for a coordinated national response.

In my view, there are areas of this that do not need to be overorchestrated. What we're seeing, at least in the insurance sector—and these are very early days, because the nature of the threat is evolving so quickly—is climate resilience or severe weather resilience also emerging as a bit of a competitive space within the insurance industry. This is very positive, and there's opportunity here for real innovation.

A government could, for example, create something of an innovation fund that might incentivize insurers to put in more of their own money, provided there was some government partnership. In this sense, perhaps there are opportunities to leverage private-public opportunities without the need for the level of coordination that you've rightly described to truly have a coordinated national response.

However, that is a very steep hill to climb. We must do that work, but where are the opportunities along the way? We need those, too. The experiences from this past summer and recent years show us that the time for action and mitigation is clearly now. Canadians need it.

[Ellis Ross, Conservative, Skeena—Bulkley Valley, BC]

It has been stated that the U.S.A. model is actually failing, mainly because it's over budget and doesn't cover all of the costs coming from extreme weather events. Canada has the DFAA, and we're talking about the issue of trying to mitigate that cost or maybe building on the DFAA, but in this case we're talking about a partnership with the private sector, which is the insurance sector.

Is there a pathway forward that's open, transparent and accountable to the people of Canada, showing that we're going to mitigate these costs, including all of the encouragement to homeowners building in high-risk areas?

[David Leibl]

I think that partnership is essential. Canadians look to their insurance companies, rightly, to protect them, but when climate risk becomes a near certainty, it's no longer a risk but rather an almost certain event. The role of insurers there is very limited. That's not how the insurance system was designed.

For Canadians to have adequate protection, there needs to be that partnership between insurers and the government. We've started down that road. We're certainly very open to it, and I think I speak on behalf of the industry when I say we're always willing to come to the table, because these discussions are essential.

[The Chair, Liberal, Angelo Iacono]

Thank you very much.

Mr. Fanjoy, the floor is yours for five minutes.

[Bruce Fanjoy, Liberal, Carleton, ON]

Thank you, witnesses.

David, I'm quite familiar with Wawanesa. When you were talking about locations in downtown Winnipeg, I was thinking about how I was there for most of a decade, nearby on Garry Street.

I want to ask about rural policyholders, of which I expect you have many. The rural residents of Canada face all of the same issues with respect to climate change and extreme weather events. I expect their experience recovering from those events is different from that of people in the cities. Perhaps you could elaborate on what we're facing through a rural lens.

[David Leibl]

We insure across Canada, but we have many rural members. The challenges in rural communities are quite pronounced, and often more pronounced than those in urban centres.

In urban centres, we saw with the hail in Calgary and the flooding in southern Ontario and Quebec last year that there was very catastrophic, enormous damage. For context, with that rain last year in southern Ontario and Montreal, the volume of insured losses from just those 48 hours of rain was roughly equivalent to the average insured losses that we used to see in an entire year just a generation ago. This is the reality we're in right now. That's the concentration.

In rural areas, you don't have that same concentration, but you also don't have the same level of infrastructure. Again, with local leaders, we have full partners at the table, and we invest as part of our philanthropic giving and community giving in organizations supporting rural communities—farmers in particular—in mitigation and awareness efforts.

We've heard from local leaders that they absolutely need the support. In some of these communities, you may have mayors and reeves who are in a part-time role, for example. The infrastructure is simply not there. These are the communities that are often demonstrating exceptional leadership. Rural communities are tough, and they know how to respond to challenges—that's not new—but when the face of the threat is evolving as quickly as it is, we need to be there to support them.

When we hear, as we did this summer, for example, that one rural community is lending fire trucks to another, that's wonderful, but is there a coordinated federal response to help these same local leaders, so that we can be there in their time of need?

[Bruce Fanjoy, Liberal, Carleton, ON]

You have “stronger home” and eco-friendly coverage available to policyholders. I don't know how prevalent that is in the industry, but I'd like to give you a chance to tell us about that.

[David Leibl]

I very much appreciate your familiarity with some of our insurance products.

We do have two optional coverages available right now that we price on a cost recovery basis. The intent is for as many Canadians, our members, to avail themselves of these optional coverages as possible. Essentially, the way that the building back better provision works is, if you were to encounter a loss, as part of your claim settlement, for no more cost to you as the policyholder or the member, we would be able to have a higher resilience standard. If a significant event were to happen again, you'd be better protected.

More broadly, beyond just Wawanesa Insurance now, there is an ongoing shift within the insurance industry, and it's a necessary one, shifting from that protective reactive posture to more of a preventative one. That is a change, and it takes a lot of public education. In my view, it's very fair for Canadians to say now, “Why do I need to be invested in these prevention efforts? You're the insurance company. You should be there for me.” Historically, that has been the absolute value proposition, as it is today. For any of our members who suffer a loss, we will be there for them. That's why we're in business. As a mutual company, we take those responsibilities very seriously.

Could uptake around these products be stronger? Yes. I don't think we're alone as an insurer in having that experience. What you're seeing now is increasingly some insurers bundling some of these coverages into their base wordings, in other words, as part of their core product suite. This is something that's evolving very quickly in real time, but here again there's also a chance that insurers are taking on disproportionate risk. This is happening in the absence of a broader national conversation around these needs.

Again, we'll try to do our part, but I think we need the federal government to join us.

[Bruce Fanjoy, Liberal, Carleton, ON]

Thank you.

You asked whether uptake could be better. I think that speaks to Mr. Stewart's point earlier that there's a pervasive feeling among individuals that, while disasters happen, they're not going to happen to them personally. We then tend to get, as individuals, more reactive than proactive.

I'd like to open this question to all of the witnesses.

What have you learned about what...?

Oh, that will be for the next round. Thank you, Chair.