Canada’s life & health insurance sector breaks records
Canada’s life & health insurance sector breaks records | Insurance Business Canada
Life & Health
Canada’s life & health insurance sector breaks records
New figures revealed
Life & Health
By
Terry Gangcuangco
The Canadian life and health insurance sector experienced a record 2023, paying out a historic $128 billion in benefits last year. Spanning health insurance, life insurance, and retirement products, the payouts marked a 13% increase over 2022, with daily disbursements exceeding $350 million.
“To put this into context, the amount insurers paid out last year to Canadians is greater than what the federal government provided in old age benefits, child benefits, and employment insurance combined.”
According to CLHIA’s newly published “Canadian Life & Health Insurance Facts” report, the sector provided coverage for nearly 30 million Canadians in 2023, equivalent to 75% of the population. The payouts include $36.6 billion in claims for health, drugs, and dental care.
Disability benefits reached almost $10 billion, offering wage replacement for 12 million Canadians unable to work. In 2023, the sector paid nearly $63 billion in retirement benefits through annuities, alongside $48 billion in health claims and $17 billion in life insurance payments.
Prescription drugs remained the largest health expense at $15 billion, but there was notable growth in claims for paramedical services like massage and physiotherapy. Additionally, mental health claims continued their upward trend, with counselling services amounting to $730 million – more than doubling in four years.
Highlighting the industry’s broader economic impact, Frank added: “Insurers also did their part to contribute to Canada’s economic growth with $960 billion invested in long-term assets. They also contributed $11 billion to the country’s tax base, including a staggering 80% increase in corporate and federal capital taxes paid in 2023.”
At the same time, the life insurance market experienced growth in the second quarter of 2024. According to LIMRA’s (Life Insurance Marketing and Research Association) retail Canadian life insurance sales survey, total life insurance new annualized premium rose to $522 million in the period, reflecting a 10% increase. Policy count also grew by 4%.
“It was a strong quarter with all product lines recording premium and policy count growth,” declared John Carroll, senior vice president of life & annuities at LIMRA and LOMA (Life Office Management Association). “Remarkably, for the first time in three years, all participating companies reported positive gains in total premium.
“New LIMRA research shows the need for life insurance remains high. Almost one in three Canadian adults, representing 8.4 million adults, say they need or need more life insurance coverage. With inflation easing in Canada, consumers may be more open to purchasing the life insurance they know they need, providing a great opportunity for the industry.”
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