Report highlights how government can improve insurance market conditions for Canadian businesses

TORONTO, May 6, 2024 /CNW/ - A new report from Insurance Bureau of Canada (IBC) recommends policies that governments can adopt to help stabilize commercial insurance premiums for businesses and reduce cost pressures within the commercial insurance market.

"Our report provides governments with a road map for enhancing the sustainability of the commercial insurance market," said Liam McGuinty, Vice-President, Strategy, IBC. "Key recommendations focus on reducing tax burdens, adapting to climate change, reforming tort laws, tackling challenges in commercial trucking, and enhancing cybersecurity measures. These initiatives will contribute to a stronger commercial insurance ecosystem, better equipped to support Canadian businesses."

In developing the report, Fuelling business prosperity ? government's role in fostering a sustainable commercial insurance market, IBC sought input from business organizations, including the Canadian Federation of Independent Business, to understand ongoing challenges and provide governments with policies and reforms that can lead to a healthier operating environment for businesses.

Taxes charged on top of commercial insurance policies emerged as one of the top concerns for Canada's business organizations. The report finds that depending on the province or territory, insurance premium taxes and retail sales taxes can be up to 20% of the premium; this can result from an overlaying of taxes, otherwise known as "a tax on a tax." The significant cost of taxes may deter businesses from securing adequate coverage. The report advocates for eliminating or reducing these taxes and postulates that such a move would encourage businesses to invest in comprehensive insurance and risk management plans to ensure resilience against unforeseen events.

"Commercial insurance plays a pivotal role by supporting the stability and expansion of businesses in all industries," said McGuinty. "It provides businesses with the necessary safety nets to take risks, innovate, grow and meaningfully contribute to the economy. Government has a critical role to play in ensuring policy decisions support the continued vibrancy of the commercial insurance sector, and support the stability and growth of businesses."

The commercial insurance industry provides tremendous value to Canada's economy, according to a recent report. Not only does it contribute nearly $15 billion to Canada's GDP, it provides about 115,000 jobs and $8 billion in labour income.

A recent MNP report found that new commercial truck drivers who haven't received adequate formal training are at higher risk of a collision, which is a safety hazard for everyone on the road.

As cyber threats continue to evolve, businesses ? particularly small and medium-sized enterprises ? will need more education on cyber security, resilience and how to qualify for cyber insurance.

Established in 1964, Insurance Bureau of Canada (IBC) is the national industry association representing Canada's private home, auto and business insurers. Its member companies make up the vast majority of Canada's highly competitive property and casualty (P&C) insurance market.

As the leading advocate for Canada's private P&C insurers, IBC collaborates with governments, regulators and stakeholders to support a competitive environment for the P&C insurance industry to continue to help protect Canadians from the risks of today and tomorrow.

IBC believes that Canadians value and deserve a responsive and resilient private P&C insurance industry that provides insurance solutions to both individuals and businesses.

For media releases, IN Focus articles, or to book an interview with an IBC representative, visit ibc.ca. Follow us on LinkedIn, X and Instagram, and like us on Facebook. If you have a question about home, auto or business insurance, contact IBC's Consumer Information Centre at 1-844-2ask-IBC. We're here to help.

SOURCE Insurance Bureau of Canada