Image by HaydenSoloviev, CC BY 4.0, via Wikimedia Commons. Modified by cropping and background blurring.
As King Charles delivered the federal government’s latest throne speech, the insurance industry is flagging a key omission: the growing cost of climate-driven disasters.
The speech, the first in nearly five decades by a sitting monarch, set out a plan to transform Canada’s economy by cutting regulatory red tape, boosting energy exports, and building industrial capacity in both clean and conventional sectors. But insurance-linked costs were not addressed directly, raising concerns among climate policy experts and insurers.
With wildfires, floods, and other extreme weather events pushing insured losses to new highs, industry stakeholders say a national economic strategy that overlooks climate resilience could worsen the affordability crisis for households and businesses already paying more for coverage.
“Climate change is already making life in Canada less affordable,” said Rick Smith, president of the Canadian Climate Institute.
He called on the federal government to act on five key policy areas, including climate-based resilience standards for housing and finalizing regulations for methane emissions in oil and gas. These steps, he said, would protect homes and communities while supporting long-term affordability.
The insurance industry has consistently pointed to the financial strain caused by more frequent and severe weather events. According to the Insurance Bureau of Canada, 2023 saw over $3 billion in insured damage from natural disasters, one of the costliest years on record. Without targeted investment in climate adaptation, insurers warn that premiums will continue to rise and availability of coverage may decline in high-risk areas.
Dan Kelly, president of the Canadian Federation of Independent Business, said that while small energy firms welcomed the inclusion of “conventional” energy alongside clean power in the throne speech, the lack of concrete action on previous promises, including unpaid carbon tax rebates, remains a concern.
“That’s money that could be used to support small businesses transitioning to greener operations or adapting to climate-related risks,” he said.
The speech also emphasized the need for fast-tracked infrastructure and regulatory reform, pledging that Canada “will not just survive ongoing trade wars, but emerge stronger.” For the insurance sector, however, that strength also depends on future-proofing the economy against escalating physical and financial climate risks.
Labour leaders echoed the need for balance. “Unlocking Canada’s energy potential requires more than speeding up approvals,” said Unifor president Lana Payne, adding that a sustainable economic path must also uphold environmental standards and protect communities from disaster-related impacts.
As the federal government signals an aggressive timeline for economic transformation, insurers and climate advocates say the pace of change must also include risk reduction or risk deepening the very affordability crisis it aims to solve.
