TORONTO — Intact Financial Corp. estimated in a report Thursday that losses due to wildfires and other weather events totaled nearly $570 million so far in the third quarter.
The property and casualty insurance company said the amount is approximately $2.40 per share, but noted that the wildfires continue to burn and actual losses may differ from its estimate.
Intact says it will issue an update in early October if its catastrophe losses increase significantly by the end of the quarter. Shares of the company ended the day down $3.09, or 1.6 percent, at $190.50.
Nadja Dreff, head of Canadian insurance at DBRS Morningstar, said although she expected to see a higher estimate of losses from Intact, it did not affect the firm’s estimate for the overall insurance industry.
He said the wildfire damage will likely add to evacuations earlier this month in Yellowknife and Kelowna, B.C.
“But we also note that this is an ongoing situation,” she said.
Canada has had its worst wildfire season on record this year, with thousands of residents displaced from British Columbia and the Northwest Territories in recent weeks.
DBRS Morningstar estimated earlier this month that insured losses due to wildfires in the third quarter for Canada’s insurance industry would be between $700 million and $1.5 billion, which it called “manageable” for insurers.
Insurance staff across Canada are supporting customers by verifying coverage and funding for additional living expenses, and are on the ground to offer assistance wherever possible, Charles Brindmaur, chief executive of Intact, said in a statement.
Insurance companies typically plan ahead to protect against unforeseen circumstances, Dreff said.
He said the industry is prepared to deal with the current natural calamities and has adequate resources.
“In other words, it may impact net income for the next quarter but nothing beyond that.”
Craig Stewart, vice-president of federal affairs at the Insurance Bureau of Canada, said it is not surprising to see Intact disclose that this summer’s wildfires are having a material impact on his company.
Insurers, he said, are looking to the federal government for signs on future climate-related changes.
“The government must prioritize climate adaptation because it is only through concerted investment in protecting communities that insurance will be available and affordable across the country,” Stewart said.
This report by The Canadian Press was first published on August 31, 2023.
Companies in this story: (TSX: IFC)
Ritika Dubey, The Canadian Press
