Why Canada’s Housing Crisis Needs a Disaster-Resilience Overhaul
When we think about the housing crisis in Canada, most conversations center around affordability, availability, and sustainability. But there’s a glaring oversight in the strategies proposed by federal and provincial governments: the lack of focus on disaster resiliency and the dangers of building in high-risk hazard areas.
Celyeste Power, President and CEO of the Insurance Bureau of Canada (IBC), addressed this issue head-on during the recent KPMG 2024 Insurance Conference in Toronto. Power highlighted a critical gap in Canada’s housing policies — the continued allowance of building in floodplains, wildfire zones, and other high-risk areas.
“Right now, if you read these strategies in the way that they’re written, you basically can build wherever you want, with whatever materials you want, just as long as it’s done quickly and cheaply,” Power said. While affordability and speed are important, ignoring where and how homes are built exposes Canadians to avoidable risks. And in the long run, it costs us all more — emotionally and financially.
Why Location Matters More Than Ever
Canada is the only G7 country without a national insurance scheme to manage losses from natural disasters, making this issue even more pressing. Over the past decade, IBC has been advocating for a national flood insurance program, which is finally expected to launch next year. This public-private partnership aims to provide affordable insurance to over 1.5 million Canadians living in high-risk flood areas.
But even with this progress, concerns remain. Will homeowners in flood zones be encouraged to rebuild in the same risky areas after receiving payouts? Power emphasized the need for policies that don’t just respond to disasters but actively prevent future ones. “If you get a payout from this program, you should not be able to get a second payout from the program,” she said. “You need to move. You need to retrofit.”
The Real Cost of Ignoring Disaster Resiliency
It’s not just about insurance programs — it’s about long-term sustainability. Power warned that the most expensive home is the one you have to rebuild twice. Despite the anticipated progress with the flood insurance program, there’s still a lack of momentum in embedding disaster resiliency into housing plans. Without a coordinated effort between federal, provincial, and municipal governments, the cycle of destruction and rebuilding will continue.
A Call to Action for Governments and the Insurance Industry
Power’s message is clear: building affordable housing must include building smarter, safer housing. This means incorporating flood defenses, enhancing stormwater infrastructure, and promoting resilient building practices. Farhan Karamat, Vice President of Finance at Travelers Canada, echoed this sentiment, suggesting incentives like discounts for renewable energy projects and sustainable construction as a step forward.
“There are just things… as an industry we need to keep talking about with the levels of government,” Karamat said. Collaborative conversations like these are vital. But talk isn’t enough — it’s time for action.
What’s Next?
The clock is ticking. With the next federal election looming (set for no later than October 20, 2025), the future of initiatives like the national flood insurance program could hang in the balance. Meanwhile, homeowners, developers, and governments alike must shift their focus to disaster resilience if we’re serious about creating sustainable, affordable housing solutions for Canadians.
The housing crisis is about more than just supply and demand. It’s about ensuring the homes we build today can withstand the challenges of tomorrow. After all, affordability means little if a home is washed away or burned to the ground. It’s time to rethink housing policies through the lens of risk, resilience, and responsibility — because the safety and stability of Canadian families depend on it.