The Seismic Shift in Realty Insurance

*This post is sponsored by one of The Real Estate Investment Network’s Trusted PartnersPark Insurance. To become a contributing editor or to learn about our sponsorship opportunities, please contact us at

The Seismic Shift in Realty Insurance

What REIN Members Need to Know

The realty insurance sector in Canada is facing very challenging times—to say the least. It represents a seismic shift in the way insurers are assessing the coverage they will offer to this segment of the market. Across the country, realty property losses continue to increase—often sharply.

Water Damage: This sector has been hammered by serious increases in the frequency and the costs due to water damage. For example, over the past eight years, water damage claims—overflowing, burst pipes, etc.—have increased 400% compared to the previous 25 years.

Natural Disasters: Across Canada and around the world, natural disasters continue to wreak havoc on properties. Overall, the Canadian insurance industry faced losses of $5.2 billion in 2017, $2 billion in 2018 and $1.3 billion in 2019. More recently, the hailstorm that hit Calgary in mid-June of this year caused an estimated $1.2 billion in insured damages. (Six of the ten most expensive and severe weather events have happened in Alberta.)

The Impact of Our Global Society

In addition to Canada’s own litany of disasters, those that occur in other countries also impact Canadian insurance prices. Why is that?

Reinsurers Role in the Cost of Insurance

Like any other business, insurance companies require protection against risks, such as in the case of huge losses due to hundreds, if not thousands, of claims that are filed after catastrophic events or disasters. 

Reinsurers provide “insurance for insurance companies.” These reinsurers are the ones who set the rates for insurance companies, who in turn pass these rates on to consumers. Reinsurers take a global view of the insurance industry when setting rates. This means that disasters in one part of the world can affect the cost of insurance in other parts of the world, like the wildfires in California or the floods in the southern United States.

Unfortunately, the entire insurance industry is impacted by these international catastrophes. And all providers of realty insurance are compelled to increase their premiums. In fact, some insurers are pulling out of this type of business or are no longer offering the type and levels of coverage they once did. (For more details on why insurance premiums continue to rise, please read this article.)

Where Does This Leave REIN Members?

We are pleased to assure all REIN members that the REIN Ultimate Insurance Program isn’t going anywhere! 

Gore Mutual Insurance Company, the oldest property insurance company in Canada, will now underwrite the REIN Ultimate Insurance Program. 

What this means for REIN members is that the REIN Investor Guard and Strata Guard policiescontinue to be available to all members in British Columbia, Alberta, Saskatchewan, Manitoba, and Ontario.

Moving Forward Together

Value-based Coverage. We know we need insurance. We also know that we don’t want to spend any more than we have to on it. The challenge then is to secure policies that deliver the very best value. Insurance value is measured by:

  1. Types of coverage offered
  2. Levels of coverage available and deductibles
  3. Correctly assessing adequate coverage for your assets
  4. Broker expertise, advocacy, and customer service before, during, and after a claim is filed
  5. Competitive pricing for the coverage 

Preventive Actions. Reducing Costs. Each policy holder can play a role in reducing insurance costs. How? By taking preventive actions against losses. This includes preventive measures to protect your assets against theft, fire, floods, storms, cybercrime, and much more.  Most of the preventive actions are simple, inexpensive, and effective.  Reducing the frequency and the size of claims in turn reduces the costs for everyone. Your efforts to reduce the number of claims is a win-win for everyone.

For additional ways to reduce your costs, please review the following:

Our Commitment to You

Our commitment to you is to continue to offer the very best high-value investment property insurance available anywhere and to keep the REIN Ultimate Insurance Program sustainable for many years to come.

Questions? Want a quote? Connect with us at your convenience online, by email (, or at: (604) 659-3130 or toll-free 1-800-663-3739.

Chris Westrop is the Vice President of Commercial Lines at Park Insurance. He has over 25 years of experience in the commercial insurance business and is a Chartered Insurance Professional with the Insurance Institute of Canada and a member of the Professional Liability Underwriting Society. He is also a REIN member and a regular attendee of many of our programs. He may be reached at (604) 659-3133 or

Keep up to date with the latest REIN news and events! Subscribe now:

Stay Connected

All Access

Twitter Feed