JERSEY CITY, N.J. — July 5, 2022 — As volatile construction costs persist, a historical view of trends paired with up-to-date pricing better equips insurers, adjusters and contractors to understand the impact of these costs on losses. Verisk’s 2021 Property Report for Canada provides insights into property insurance trends for benchmarking.
The report analyzed 286,346 Canadian claim assignments processed by XactAnalysis®, Verisk’s claims assignment, management and analytical solution, totaling $2.6 billion in losses from 2021. Findings include:
- Total volume and value of property claims
- Rate changes for reconstruction costs by province and territory
- Trends for common building materials, such as lumber, drywall and roofing
- Costs for personal protective equipment
“The restoration and construction industries in Canada are grappling with significant inflation and supply chain issues, leading to higher loss severity for insurers,” said Mike Fulton, president of Verisk property estimating solutions. “Lumber prices and the cost of other key building materials have continued to rise, and it’s difficult to see how these trends might lessen this year. However, access to historical trends and up-to-date, local pricing data can help insurers and contractors make crucial business decisions as this activity unfolds.”
The report found that the COVID-19 pandemic, high lumber costs, inflation and damage from wind, hail and water contributed to property claims and pricing trends throughout 2021. Average reconstruction costs experienced slight increases during Q1 and Q2, followed by a jump to 9.12% during Q3, far greater than the year-end 6.27% increase in 2020. Costs then decreased 3.10% in Q4, primarily driven by changes in lumber costs. More than half of all property claims in Canada last year involved water damage, and about 16% of all property claims involved roof damage.
This industry perspective on the pricing of labor and materials is uniquely embedded in the Verisk property estimating solutions suite with millions of price points updated at least monthly. The interactive property report is now available at Verisk.com.
Verisk (Nasdaq: VRSK) provides data-driven analytic insights and solutions for the insurance and energy industries. Through advanced data analytics, software, scientific research and deep industry knowledge, Verisk empowers customers to strengthen operating efficiency, improve underwriting and claims outcomes, combat fraud, and make informed decisions about global issues including climate change and extreme events as well as political and ESG topics. With offices in more than 30 countries, Verisk consistently earns certification by Great Place to Work and fosters an inclusive culture where all team members feel they belong. For more, visit Verisk.com and the Verisk Newsroom.