The growing threat of wildfires in Atlantic Canada is prompting concerns over rising insurance costs, as recent events highlight the increasing frequency and severity of such disasters in the region.
Trisha Murray, a resident affected by the 2023 Upper Tantallon wildfire, recounted the day her home was destroyed.
“We could see embers falling, we could see ash falling, the pine needles were hitting our house, it sounded like hail,” she said in an interview with CBC. The blaze, which swept through subdivisions just outside Halifax, resulted in the destruction of 151 homes.
Murray described the trauma of both the evacuation and the aftermath, stating, “We were traumatised from the evacuation itself. We were traumatised afterwards by the fact that we lost everything.”
She noted that the insurance process was lengthy, taking hundreds of hours, and it was 20 months before her home was rebuilt.
The experience is becoming more common across Atlantic Canada as wildfires encroach on communities. Paul Kovacs, executive director at the Institute for Catastrophic Loss Reduction, observed that, historically, insured losses from wildfires in Canada were concentrated in Alberta and British Columbia for decades until 2023. However, this year’s fire season marks a shift.
“It’s a national issue in terms of fires. It’s becoming more of a national issue in terms of structures being lost,” Kovacs said.
Large-scale wildfire losses in recent years have led to higher claims costs for insurers, which in turn have driven up reinsurance expenses and resulted in tighter underwriting practices in high-risk areas.
As the risk landscape evolves, insurers are increasingly likely to reprice coverage, reassess policy limits, and impose stricter guidelines for properties located in wildfire-prone zones. This trend is particularly pronounced in rural and forest-adjacent communities, where the risk of loss is now considered much greater than in previous years.
The 2025 wildfire season has already seen nearly 7.5 million hectares burned across Canada, with more than 60% of the affected area located in Saskatchewan and Manitoba. Atlantic Canada, which has traditionally been less exposed to wildfire risk, is now experiencing significant impact as well.
In response, provinces such as Newfoundland and Labrador and Nova Scotia have implemented bans on off-road vehicles and outdoor activities in an effort to reduce the likelihood of new fires starting.
The shift in wildfire activity from Western Canada to the Prairies and Atlantic Canada is also notably challenging the insurance industry’s traditional pricing models and raising questions about the affordability of coverage for homeowners and businesses. As fire risk spreads beyond established hot spots, underwriters are finding it increasingly difficult to assess exposure and set premiums that accurately reflect the new reality.
Besides being Canada’s second worst season on record, the majority of property destruction is happening across the prairies and in Atlantic Canada. This trend presents new challenges for both homeowners and insurers. Insurers are reassessing their risk models and pricing strategies in response to the uptick in claims.
“They all need to make decisions based on their losses for how they can serve their customers going forward,” Kovacs noted.
As insurance companies face more claims and higher payouts, the likelihood of increased premiums rises. “Insurance companies will think about is the price they’re charging the right price for the risk,” he added.
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