For Canada’s insurance industry, 2025 was not defined by a single dominant threat but by the convergence of several. Climate-related catastrophes, escalating cyber risk, social inflation and trade uncertainty combined to create what Markel Canada president and managing director David Crozier (pictured) described as a year of “complex and interconnected risks” that tested resilience across the economy.
Those pressures were widely felt, but not evenly distributed.
“Almost no matter what industry you’re in, you felt something from one of those in 2025,” Crozier said. Whether through flood damage, rising auto repair costs, cyber exposure or litigation, few businesses – insurers included – were untouched.
Among the sectors that experienced the most volatility were those tied closely to construction. While government infrastructure spending and municipal building programs created strong demand, companies faced persistent headwinds from labour shortages, supply chain disruption and rising costs.
“They’re seeing business on one hand, and risk and threat on another,” Crozier said, noting that construction firms are simultaneously exposed to climate events, cyber risk and cost inflation. That combination, he added, introduced heightened volatility rather than straightforward growth.
Manufacturing faced similar pressure. Tariffs, trade tensions and supply chain vulnerabilities continued to ripple through production lines, affecting both input costs and delivery timelines. Those challenges were compounded by cyber risk, as manufacturers increasingly rely on interconnected systems and third-party vendors.
Public entities and municipalities also faced growing exposure in 2025, particularly on the liability side. When infrastructure fails or accidents occur, Crozier said, the search for accountability often leads back to public operators.
“When something goes wrong, people are looking for a party to make them whole,” he said, pointing to the challenge of maintaining vast networks of municipal roads and public assets amid rising expectations and costs.
Social inflation – driven by higher damage awards, legal expenses and public expectations – amplified those pressures, pushing liability costs higher across both public and private sectors.
Energy and resource companies faced a different kind of scrutiny. Diverging approaches to environmental, social and governance (ESG) issues across jurisdictions created added complexity for boards and executives.
With US policy shifting away from ESG mandates while other regions maintain them, Crozier said companies operating across borders are navigating inconsistent expectations. Boards, in particular, must demonstrate prudence while balancing regulatory, investor and public pressures that vary sharply by geography.
Not all sectors struggled. Crozier pointed to advanced manufacturing – particularly tied to electric vehicles and global export markets – as an area that showed notable resilience.
Canadian firms with diversified export destinations were better positioned to absorb trade shocks and supply chain disruptions, he said. Many have also adopted more disciplined operational and risk management practices following the lessons of the pandemic.
“That offers us room to bring smart insurance solutions that actually add value,” Crozier said, beyond traditional risk transfer.
Technology and life sciences companies experienced rapid innovation in 2025, which brought opportunity but also evolving risk profiles. New products, code and procedures introduced heightened exposure around cyber, intellectual property and product liability.
Rather than being negative, Crozier characterized this as a shift that requires insurers and clients alike to reassess how risks are identified and mitigated as innovation accelerates.
Healthcare emerged as another resilient sector, supported by demographic trends. Canada’s aging and slowly growing population continues to drive demand for care, services and innovation, insulating the sector from some of the trade and tariff volatility seen elsewhere.
Professional services also demonstrated flexibility. With fewer fixed costs and greater ability to adjust quickly to economic changes, many firms were less exposed to supply chain and infrastructure-related shocks.
Across sectors, Crozier said 2025 reinforced a broader shift underway in the insurance industry: away from insurance as a product purchased after something goes wrong, and toward insurance as part of an integrated risk management strategy.
“Buying a policy just isn’t enough,” he said. Services that help prevent losses or mitigate their impact – particularly in areas like cyber – are becoming a central part of how sophisticated companies manage risk.
As insurers and brokers look to the rest of 2026, the lesson from 2025 may be less about predicting the next shock, and more about understanding how different industries absorb them – and how insurance can evolve alongside that reality.
