Canadian companies are grappling with an evolving set of risks, and insurance strategies are shifting accordingly, according to Michael Lewis (pictured), chief commercial officer at Marsh Canada.
Speaking with Insurance Business at the Canada RIMS conference, Lewis highlighted four themes dominating client conversations: geopolitical volatility, climate-driven catastrophe losses, AI and digitization, and liquidity pressures.
“There are probably four major key risks that companies are coming to us with at this point in time,” Lewis said.
For some industries, particularly aviation and manufacturing, global instability has emerged as a major pressure point. Lewis pointed to war and terrorism exposures, as well as potential price pressures in aviation hull loss coverage, as areas where insurers are closely watching risk trends.
“Depending on the industry, [geopolitical risk] can be supply chain, it can be like war and terrorism, and especially with hull loss for aviation companies,” Lewis said.
He also noted that tariffs remain a significant concern, particularly for manufacturing clients exposed to cross-border trade.
The rising toll of extreme weather is reshaping the Canadian insurance market, Lewis said. Last year saw the largest natural catastrophe loss on record in Canada, with $8.6 billion in insured damages.
That scale of loss, he added, has placed increased urgency on how businesses approach climate resilience and insurance protection.
Another top-of-mind issue for clients is how artificial intelligence and digitization will reshape business operations and risk.
While many companies are looking to harness AI for efficiency gains, the speed of adoption is also creating new exposures and challenges for insurers, Lewis said.
Finally, Lewis emphasized that cash flow pressures are influencing the insurance strategies of many clients.
“Liquidity is the number one concern for a lot of our organizations,” he said, adding that liquidity can be linked to the economic downturn.
“So, how do you balance protecting the company, but maintaining cash and cash flow in this economic environment?”
To manage those pressures, companies are increasingly exploring alternative risk transfer and financial products, he said. Banks, for instance, are considering non-payment insurance, while other firms are turning to trade credit solutions and surety bonds as tools to strengthen balance sheets, he added.
Beyond immediate exposures, Lewis noted that Canadian businesses are also struggling with how to balance long-term structural risks like AI, ESG obligations, and cyber with the more immediate challenge of rising coverage costs.
He argued that while AI is often portrayed as a brand-new risk, in reality, it is a longstanding technology that has only become more pressing because of its rapid integration into business operations.
“Everyone thinks that AI or Gen AI is a new risk. It’s not necessarily a new risk because AI has been around for 50 years,” Lewis said. “It’s an evolving risk because people are using it more.”
That rapid adoption, however, is straining traditional risk management practices. As businesses embed digitization and automation into their operations at speed, exposures are outpacing their ability to measure, mitigate, and transfer those risks effectively.
“Digitization is happening at such a fast pace that it’s difficult to try and keep up with risk management, mitigation, and transfer associated with that,” Lewis said. “It does create a lot of risk issues for organizations. They are reviewing it, but unfortunately, it’s moving with such pace that it’s a struggle to keep up and make sure that you’ve got the capability to cover that risk.”
This, he added, leaves risk managers with a dual challenge: keeping ahead of technological change while managing the short-term financial strain of insurance costs. For Lewis, the key lies in proactive planning, leveraging the right risk-transfer tools, and ensuring that boards and executives are asking the right questions about whether coverage is keeping pace with fast-moving exposures.
Looking ahead, Lewis suggested that these themes are unlikely to fade anytime soon. Instead, he expects them to become increasingly interconnected, with climate pressures amplifying supply chain fragility, geopolitical risks influencing liquidity, and rapid digitization reshaping every part of the risk landscape. For Canadian companies, he argued, the challenge will be to not only respond to immediate shocks but to build strategies resilient enough to withstand overlapping disruptions.
