Over $8.5 billion. That’s how much Canadian insurance companies paid out last year because of wildfires, floods, hail, and other weather disasters. That number used to be shocking. Now? It’s becoming normal.

This is the new world. Insurance companies are no longer trying to guess “if” a climate disaster will happen — they’re preparing for when it hits.

What does this mean for insurance?

nsurance companies are changing how they do business — and fast. They’re using AI and satellite data to predict where the next disaster is likely to hit, raising prices in areas that are becoming more dangerous, and in some cases, they’re stopping coverage entirely in regions that are just too risky. At the end of the day, they’re doing whatever they can to protect themselves from going broke.

So what are they actually doing?

Insurance companies in Canada are taking a more proactive approach to deal with rising climate risks. They’re using technology like AI and satellite data to identify which areas and homes are most at risk—especially places near forests or floodplains. At the same time, they’re tightening their coverage rules, which means getting insurance in high-risk zones is becoming harder and more expensive. Many are also turning to the government for support, asking for new programs to help cover the massive losses that come with extreme weather events. On top of all that, some companies are starting to explore parametric insurance—a type of policy that pays people automatically when a disaster happens, without the usual paperwork or delays.