Top insurers for Canada’s construction sector

Canadian brokers have identified the country’s leading construction insurance providers for 2026, evaluating firms on expertise, claims handling, and long-term stability rather than price alone.

This selection arrives as the construction insurance market confronts unusual pressures. Rates have dropped to about half of 2024 levels, while risks tied to active projects have become more complicated. Severe weather, trade tariffs, and evolving building methods are changing how insurers assess and cover construction work.

Catastrophe losses reshape underwriting

Last year set a record for insured catastrophe losses in Canada. Severe weather events caused $8.5 billion in claims, marking the first time the total surpassed $8 billion and nearly tripled the 2023 amount, according to data from the Insurance Bureau of Canada and Catastrophe Indices and Quantification Inc. The decade from 2016 to 2025 saw $37 billion in losses, almost three times the previous ten-year period.

These figures directly affect construction insurers. They lead to stricter underwriting, higher deductibles, and new exclusions for natural disasters. Brokers now favor insurers with strong claims teams capable of responding quickly to large, complex losses—not just those offering the cheapest premiums.

Michael Malfa, CEO and co-founder of Toronto-based Boardwalk Insurance, noted that tariffs on steel, aluminum, and lumber introduced in 2025 have added pressure. “Tariffs are making a significant difference—construction schedules are shifting, and anticipated construction costs are running up a lot higher than they previously did,” he said. “Projects are being delayed, and budgets are stretching beyond initial estimates.”

Regional differences in construction

Construction activity differs across Canada. In British Columbia, particularly Vancouver, residential building has sharply declined. The Vancouver census metropolitan area reported its lowest constant-dollar permit value since Statistics Canada began tracking the series, according to a June 2025 report.

Alberta has performed better, while Toronto experienced selective growth in multi-unit development before scaling back in mid-2025. Civil construction remains the only major category expected to expand in 2026, with starts projected to increase nearly 30% year-over-year, based on ConstructConnect Canada’s December 2025 analysis.

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Modular construction introduces new challenges. Prefabricated components assembled off-site require insurers to evaluate risk across factories, storage yards, and transportation.

If this trend continues, insurers may need to create new risk assessment frameworks for off-site manufacturing. That shift could involve closer scrutiny of supply chains, storage conditions, and logistics—areas not traditionally part of construction underwriting.

These changes highlight how insurance practices must adapt to emerging risks.

Broker priorities in construction insurers

The 2026 rankings relied on broker nominations rather than price competition. Five key qualities distinguished the top-rated firms:

• Specialized underwriting: Insurers with teams knowledgeable about construction risks. Brokers emphasized water damage prevention as a critical factor, with leading firms providing guidance on shutoff plans, moisture control, and leak detection.
• Claims expertise: Adjusters familiar with Canadian Construction Documents Committee contracts and project timelines. Speed is essential—brokers prefer insurers that make decisions quickly without unnecessary delays.
• Coverage options: All winners included builders risk and wrap-up liability as standard. Most also offered environmental, professional liability, and delay in start-up coverage.
• Broker support: Same-day decisions on complex risks, accessible underwriters, and turnaround times measured in hours rather than weeks.
• Consistency: Insurers with a proven track record through market fluctuations, stable policy terms, and experienced staff.

Malfa stressed that claims handling often matters more than price. “A lower premium can become costly if a dispute or claim arises,” he said. “How fast can the insurer decide, and what authority do they have before escalating?”

The rankings signal a market shift. As losses rise and construction methods change, brokers favor insurers that manage complexity effectively.

These firms must balance cost with reliability.