Hurricane Debby surpasses 1998 ice storm as Quebec’s costliest disaster

• Hurricane Debby caused $2.5 billion in insured losses in Quebec, making it the most expensive disaster in the province's history
• Canada's insurance industry faces an unprecedented year with over $7 billion in insured damages from natural catastrophes
• The Insurance Bureau of Canada highlights the urgent need for enhanced climate adaptation and disaster mitigation investments

Driving the news: The remnants of Hurricane Debby wreaked havoc in Montreal, Laval, and parts of Quebec in August, causing nearly $2.5 billion in insured losses. This event is now the most expensive insured disaster in Quebec’s history, surpassing the 1998 ice storm's CA$1.75 billion in damages.

Costly disaster: Catastrophe Indices and Quantification Inc. (CatIQ) reported that flooding from Tropical Storm Debby led to $2.5 billion in insured damage in Montreal and nearby regions.

• Canada’s insurance industry is facing an unprecedented summer with severe weather events.
• Other catastrophic events this year include floods in Toronto and southern Ontario, a wildfire in Jasper, and a hailstorm in Calgary.
• These events have generated approximately 228,000 insurance claims.

The big picture: Natural catastrophes have driven Canada's insured damages to $7.1 billion in 2024, making it the highest loss year on record for the Canadian insurance industry.

• Losses from Q1 and Q2 totaled $400 million, bringing the year-to-date NatCat loss total to around $7.6 billion.
• Between 2001 and 2010, Canadian insurers paid an average of $701 million annually for severe weather-related claims - while recent years have seen this figure routinely exceed $2 billion annually.

Paying out: The Insurance Bureau of Canada (IBC) noted a surge in claims related to flooded homes, businesses, and vehicles. Insurers are working hard to support affected clients, but skilled labor shortages and supply chain issues are causing delays.

• Insurers are paying out more for this single flood event than what the federal government has invested in climate adaptation over the past decade.

What we’re watching: The rising costs of natural catastrophes highlight the urgent need for enhanced climate adaptation measures and disaster mitigation investments by all levels of government. A successful implementation of the National Flood Insurance Program, promised by the federal government, could be crucial for protecting homeowners from climate-related financial risks.