An integral ingredient in the recipe of success for the approximately 1.3 million businesses across Canada is commercial insurance.
Whether they have a large manufacturing company or a main street coffee shop in a small town, business owners recognize that access to insurance products is critical. Simply put, commercial insurance provides financial resilience and alleviates the fear that an accident or mistake could cause large losses or even financial ruin.
Insurers protect the economic system from failure by assuming certain risks inherent in producing goods and providing services. This transfer of risk allows business owners to do what they do best – create jobs and fuel economic growth.
Insurance Bureau of Canada (IBC) recently published a first-of-its-kind report, Commercial Insurance in Canada: A Socio-Economic Analysis of a Vital Industry.
The report quantifies the tremendous value the commercial insurance industry provides to Canada’s economy, including contributing nearly $15 billion to Canada’s gross domestic product (GDP), supporting about 115,000 jobs and generating $8 billion in labour income. The report also documents the many, often subtle, qualitative impacts of commercial insurance on Canadian society, including the facilitation of risk-taking and the enabling of innovation. The report also outlines key market and public policy issues affecting the commercial insurance industry, along with recommendations IBC and its members have developed to improve the system.
While the nature of risk is evolving faster than ever, commercial insurers continue to adapt their products to fulfill a demand from Canadian businesses for increased resilience in a volatile world. While insurance often exists in the background, it offers an essential layer of protection. Insurers support businesses by offering distinctive expertise, products and services that are connected to risk transfer, and also by encouraging risk prevention and mitigation.
The ability of Canada’s property and casualty industry to act as a financial shock absorber is especially heightened in challenging times like the ones we are currently living through.