The Canadian property and casualty (P&C) insurance sector is becoming increasingly concentrated, as a small group of dominant carriers expand their reach through mergers, acquisitions, and vertical integration. According to AM Best’s latest data, the country’s top 10 P&C insurers now account for nearly 59% of total market share, underscoring how scale and diversification have become key determinants of success in a changing marketplace.
Speaking at AM Best’s annual market briefing, Alan Murray (pictured left), director at AM Best, said the shift toward concentration reflects both strategic consolidation among carriers and an ongoing effort to secure greater control of distribution. “The Canadian P&C market remains quite highly concentrated,” Murray said.
The latest AM Best figures show Intact maintaining a dominant position in Canada’s property and casualty market, with a 16.1% share – a margin that places it well ahead of other national carriers. The remainder of the top 10 includes major multi-line insurers such as Aviva, Desjardins, TD Insurance, Co-operators, Definity, Wawanesa, Northbridge, Allstate, and Beneva, each holding between two and eight percent of total market share. Collectively, these firms account for nearly 59% of industry premiums, underscoring how concentrated the Canadian P&C market has become.
Together, these companies generated nearly $59 billion in gross written premiums in 2024, out of a national total of about $99.8 billion. Murray said the structure of the market is evolving rapidly, with recent merger activity showing how mid-sized players are using acquisition as a route to scale.
In 2025, Definity Financial announced a $3.3 billion acquisition of Travelers Canada, a deal that will add approximately $1.6 billion in annual premiums once completed and further solidify Definity’s position among the country’s top-tier insurers. Around the same time, Beneva and Gore Mutual revealed plans to merge, creating one of Canada’s largest mutual insurance organizations.
“These transactions highlight a broader industry reality,” Murray said. “Scale and diversification are becoming essential for long-term success in the sector, particularly as insurers invest heavily in technology and modernization.”
While consolidation among carriers has been the most visible trend, AM Best analysts say a quieter but equally transformative shift is occurring on the distribution side. Large insurers are increasingly buying brokerages, managing general agencies (MGAs), and digital intermediaries to secure direct access to customers and data – and to generate new, fee-based revenue streams.
Murray described this as “a somewhat unique feature” of the Canadian market compared with other jurisdictions. He noted that carriers such as Intact, Aviva, and Definity have pursued brokerage acquisitions not only to strengthen distribution efficiency but also to stabilize earnings through non-underwriting income.
Murray said insurers are increasingly focused not just on underwriting profitability but also on capturing value through ownership of distribution channels and customer relationships.
The approach gives carriers more control over the customer experience while reducing dependence on independent intermediaries. It also enables them to better integrate digital tools, enhance data analytics, and align pricing strategies directly with front-line sales.
However, the expansion of insurer ownership in brokerage networks has raised concerns among smaller intermediaries about market dominance and reduced autonomy. Analysts note that while these acquisitions have helped streamline operations and reduce friction, they have also intensified competition for talent and distribution margins.
Despite these pressures, Murray said the trend toward insurer-owned distribution is likely to continue, driven by cost efficiency, customer retention, and the ongoing digital transformation of the insurance value chain. “Scale matters,” he said. “You see it in how these large groups are investing in data, technology, and customer experience. For smaller and mid-sized carriers, it’s increasingly difficult to compete without those resources.”
Behind much of the consolidation lies the relentless cost of technology modernization. Over the past decade, Canadian insurers have poured billions into new systems and digital platforms aimed at improving efficiency and customer experience. But, as Murray observed, these investments have not yet translated into lower expense ratios.
“Ten or fifteen years ago, companies were saying, ‘We’ll spend all this money on our systems, and we’ll start saving every year after that,’” he said. “The reality is that costs have continued to rise as modernization has become a permanent fixture of doing business.”
That ongoing investment burden makes economies of scale increasingly valuable. Larger carriers can spread technology costs across broader operations, while smaller players may struggle to justify the same level of spending without merger synergies or partnerships.
Despite the consolidation and rising complexity, AM Best data show that Canadian P&C insurers remain among the strongest-rated globally. As of mid-2025, 97% of all rated entities held issuer credit ratings of A- or higher, an exceptional level of stability compared with most markets.
Over the past two years, rating activity has been minimal – with just a handful of upgrades and downgrades – reflecting consistent balance sheet strength and disciplined risk management. The small number of negative rating actions, Murray said, were primarily linked to transactions or ownership changes rather than fundamental weakness.
AM Best’s Issuer Credit Rating (ICR) distribution for 2025 shows the largest cluster of Canadian insurers in the AA- to A range, with virtually none below BBB+. Murray said this distribution underscores the conservative nature of the Canadian market, supported by strong capitalization, prudent reserving, and robust regulatory oversight.
The outlook data paint a similar picture. In both 2024 and the first half of 2025, more than 90% of AM Best-rated Canadian P&C insurers carried a stable outlook, with the remaining few split between positive, negative, and developing categories. The share of positive outlooks fell slightly in early 2025, from 8% to 6%, largely because several companies were upgraded and then reclassified as stable at their new rating level.
“There were no negative trends in those outlook changes,” Murray explained. “When we upgrade an insurer, their outlook often moves back to stable because they’ve reached that higher rating threshold.”
