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Insurance Industry

New report highlights extraordinary impact of insurance industry on economy

July 4, 2024 | By: Jordan Brennan, Vice President and Chief Economist, Policy Development, IBC
New report highlights extraordinary impact of insurance industry on economy

Canada’s property and casualty (P&C) insurance industry is foundational to the strength, success and resilience of its economy. In communities across the country, insurance professionals support their customers’ home, auto and business insurance needs. They help people manage risk and provide products that offer a financial safety net when disaster strikes.

However, few people are aware of the extraordinary impact the industry has in supporting jobs and contributing to economic growth across Canada.

Insurance Bureau of Canada (IBC) recently solicited help from Statistics Canada and MSA Research to gather data on the P&C insurance industry’s direct, indirect and induced impacts on gross domestic product (GDP) and employment at the national and provincial levels. This work resulted in the 2024 InsurEconomy Report, which measures the value of the P&C insurance industry to the economy. The report uses 2022 data – the most recent full year of data available.

The report highlights some key facts about the P&C insurance industry and its importance to the economy, including the following:

  • The P&C insurance industry contributes $38 billion to the country’s nominal GDP.

  • The P&C insurance industry generates nearly 300,000 jobs to the Canadian economy.

  • The P&C insurance industry is not only a major source of employment in Canada, but it also supports high-quality, high-paying jobs. Labour productivity (measured as real GDP per hour worked) of insurance carriers was 84% above the national average.

  • More than 60% of employees in the industry are women, furthering gender equality.

  • P&C insurers contribute more than $12 billion annually in federal and provincial taxes and levies.

  • P&C insurers invest heavily in government bonds that support Canada’s economy. In 2022, the P&C insurance industry held almost $39 billion in federal, provincial, municipal, public authority and school bonds.

InsurEconomy 2024 also highlights the substantial quantitative and qualitative value of Canada’s commercial insurance industry, as outlined in Commercial Insurance in Canada: A Socio-Economic Analysis of a Vital Industry.

Commercial insurers are critical to Canada’s growth and prosperity. They protect the economic system from potential financial disruptions by assuming many of the risks inherent in the production, distribution and use of goods and services for businesses. This transfer of risk allows insured businesses to operate without the risk that an accident or mistake could cause large losses or even financial ruin.

In addition to the national InsurEconomy 2024 report, IBC also published provincial reports for Alberta, Ontario, Quebec, New Brunswick and Nova Scotia, highlighting the impact of the P&C industry in those provincial economies.

About This Author

Jordan Brennan, PhD, is Chief Economist and Vice President of Policy Development at the Insurance Bureau of Canada, a position he has held since 2019.

Prior to that, Jordan was Chief Economist with Unifor, Canada’s largest private sector labour union, wherein he led the union’s engagements in macroeconomics and fiscal policy. In his capacity as Unifor’s lead economist, Jordan sat on the Ontario Finance Minister’s Roundtable of private sector economists and acted as an advisor to the Senior Deputy Governor of the Bank of Canada.

Jordan holds a bachelor degree in economics and accounting from Wilfrid Laurier University. His master’s and doctoral degrees, both in political science, were conferred by York University. Jordan closed his academic career as a visiting scholar at Harvard Law School.