As if 2020 wasn’t bad enough, with a global pandemic changing lives and livelihoods for at least the foreseeable future, it was also a very bad year for severe weather incidents. And once again, Alberta is holding steady at the top of the country for insured damages.
A mega storm hit Calgary on June 13, dumping close to five centimetres of moisture on the city in less than an hour and causing flash flooding all over the city. The northeast area of the city ended up getting the worst of it, unfortunately. Huge hailstones measuring as large as a tennis balls dented vehicles, smashed out windows, and literally stripped the siding off houses. Sadly, even now some residents are still struggling with their home insurance companies, with some even having their coverage cancelled after their claim was paid out. In addition, the Canadian Underwriter reports that the pandemic has made it harder than normal to obtain larger vehicle parts such as roofs. The reasons for this is that manufacturers have been shut down and workers have not been at their place of employment. All in all, the total damage from the storm amounted to $1.3 billion, making it the fourth costliest insured catastrophe of all time.
Add that to the terrible Fort McMurray flood that happened in the spring, which forced the evacuation of hundreds of people and left dozens of properties unlivable. Insured damages totalled $562 million, and left many owners unable to obtain coverage for their properties. “It is hard to look at a summer like this … without noting that Alberta is a very expensive place to do business,” said Celyeste Power, western vice-president for the Insurance Bureau of Canada (IBC) in a CBC article.
That was not the end of a wild few months in Alberta, however. Severe weather continued to wreak havoc over the summer. Central and Southern Alberta storms in July and August added another $221 million to the total, with hail demolishing crops and high winds ripping apart buildings. All told, insured damages from severe weather incidences totalled more than $2 billion in Alberta. For the entire country, the IBC calculated the total damage from severe weather at $2.4 billion for 2020, meaning this province is responsible for more than 87% of the final number. And this problem is not just a Canadian one. Global losses from severe weather hit $270 billion in 2020, a significant increase from previous years.
2021 not off to a good start, either
2021 stormed in like a lion with a January of storms that did not start the new year off right. Alberta and Saskatchewan combined have already reached about $132 million in insured damages due to severe weather, says the IBC in this Calgary Herald article. Intense winds from Jan. 12 to 14 ended up causing nearly $30 million in damages in this province (mostly around Lethbridge, Taber and Calgary). Gusts of up to 86 kilometres an hour marked Jan. 13 down as the windiest winter day in Calgary in seven years. Our neighbor to the east fared even worse, with damages totalling about $70 million.
Then snow squalls from Jan. 19 to 20 caused closed to $32 million in damage to the southern parts of Alberta, and they also came with ferocious winds. A gust recorded west of Calgary reached 193 kilometres an hour, which equals an EF2 tornado. Trucks tipped over on highways, trees fell, power lines came down and roofs and siding was ripped off homes and businesses.
A plan for climate change
With eight out of the top ten highest loss years on record having happened in the last decade, it’s clear that climate change is having a serious effect on the insurance industry. Of those ten, Alberta takes the top two (the Fort McMurray fire in 2016 and the 2013 southern Alberta floods), and factors in to five more.
The IBC is calling for a “national adaptation strategy with measurable targets” and investments to protect homes and businesses. Last year the federal government implemented a Task Force on High Risk Residential Flood Insurance and Strategic Relocation, which is working to ensure all Canadians have access to affordable flood insurance. This is a step in the right direction, says the IBC, however they contend that the task force should be part of a larger plan and not just stand alone.
Insurers bear a large part of the overall cost of severe weather, however taxpayers, through governments, pay a lot more. Governments are responsible for repairing damaged infrastructure, the cost of which keeps skyrocketing. It’s in everyone’s interest to look for progressive solutions to address climate change.
Tips to manage your insurance costs
The best way to manage rising insurance costs is to tap in to the expertise provided by an insurance broker. The insurance brokers here at Lane’s are trained professionals with decades of collective experience under our belts, and we thrive on being able to help people access better coverage at lower premiums.
We are always here to answer any questions you may have about your insurance. We work for you, not the insurance companies, and can pick and choose the best options available from several of Canada’s top providers. Give us a call so we can get to know you and your unique insurance situation. Contact us at our Calgary, Banff, Edmonton and greater Alberta offices.
