Canada’s manufacturing insurance market is firmly in soft territory – but underwriters are pushing hard on differentiation rather than handing out broad-based discounts.
That’s how Alexander Jeyasingham (pictured), vice president and senior underwriting manager for the Ontario and Atlantic region at Liberty Mutual Canada, sees conditions for manufacturers midway through 2026.
“We do expect a stabilization in the future, but, short term, we still continue to see that soft market,” he told Insurance Business.
Behind the headline softness, however, Jeyasingham stressed that pricing is increasingly granular.
Underwriters remain focused on risk differentiation, Jeyasingham noted.
“What they are really looking at… is each account on its own merits in terms of pricing. So it’s not just broad‑based softening,” he said.
They weigh whether the price is adequate, the account’s loss history, its exposure to perils like flood and earthquake, any risk engineering we’ve carried out, and a range of other factors, Jeyasingham said, adding that capacity is generally available for manufacturers that tick those boxes.
“Capacity is generally available, we find in the market these days for well‑managed accounts,” he said.
Inflation remains another layer in every discussion, particularly around property and business interruption values. Rising costs of materials and labour mean long‑standing limits can quickly fall out of step with replacement realities.
Beneath the broad trend, Jeyasingham sees a clear split between segments where competitive pressure is intense and niches where hard‑market conditions are lingering.
He pointed to food processing as a pressure point, citing elevated fire and contamination risks and concerns around ultra-processed products, and noted that PFAS has also become a major focus for manufacturers.
Wood‑related classes remain tough. Furniture, lumber and other wood products face not only fire load but also combustible dust hazards that demand robust protection and housekeeping.
Plastics and chemicals present a similar story, especially where fundamental risk controls aren’t where they need to be.
“That’s where we really have our risk engineers get involved too… just to get out there and help make sure that everything is adequate – not just for our sake, but also for the client. Nobody wants to experience a loss.”
Auto parts manufacturing is another area where pricing and appetite remain more restrained, in part because of the expertise required.
In southern Ontario, it’s a significant business opportunity for both insurers and manufacturers, but not every carrier has the necessary expertise, he said, and without that specialization, it becomes a much harder class to underwrite.
By contrast, advanced manufacturing with strong controls is attracting aggressive competition, particularly where automation and fire protection are already in place.
Modern plants with up‑to‑date fire suppression are also squarely in the market’s sweet spot.
Metalworking operations – especially those focused on component parts rather than finished consumer goods – are another area where pricing has moved in buyers’ favour.
“Metalworking obviously contains less combustible materials than plastics and chemicals, and those parts are less involved in litigation. We do find that market softening quite a bit as well.”
Asked what he looks at to judge where the market is headed, Jeyasingham points less to headline rate indices and more to the interplay of cats, submissions and carrier behaviour.
Recent catastrophe experience is one key marker.
“We’ve had a favourable catastrophe loss season for the past year or so,” he said, pointing to flood, earthquake and wildfire as the big drivers.
“There’s obviously been some major losses, but it’s been generally more favourable than we’ve seen in the past… That’s a trend that helps us know that the market’s still a little bit softer because carriers haven’t experienced that big loss pressure.”
Another signal is how much competition he sees on the best risks – and how long that intensity persists.
By contrast, he starts to think about a turn when insurers begin backing away from tough segments, rather than trying to win everything on offer.
“As we get to those more challenging accounts – where there’s a little bit more specialty or expertise involved – when the carriers start backing away from those, I think that’s a good indicator of the market turning,” Jeyasingham said.
