The life and health insurance sector plays an important role in the lives of Canadians by providing insurance against unexpected events and enhancing their financial condition in the future. Traditional insurance, such as life and disability insurance, spreads risk across many persons to insure against loss of life, serious disability affecting employment or need for additional medical attention.
From estimation it is seen that more than 110,000 Canadians are employed in the life and health insurance sector, making it a significant contributor to Canada's economy. About 57,000 are employed full time by the insurers while the remainder work as independent agents. In total, the life and health insurance industry employs more people than the forestry, chemicals, or pulp and paper sectors.
Recent trends in Canadian Insurance
Canada's insurance companies have made money every year between 1993 and 2003. Profits did hit a low point of $340 million in 2002. Those profits were for 206 companies and represented a 1.7 per cent return on equity.
In March 2004, the insurance industry reported that things were starting to look better. The Insurance Bureau of Canada (IBC) reported profits of $2.6 billion - its best year ever and almost eight times the profits the bureau's 206 members enjoyed in the previous year. "The average company net earning figure was approximately $13 million," the bureau said in a news release.
For the year 2000,banks and other deposit taking institutions in Canada accounted for 50% of the total financial sector services and the rest was divided among life and health insurance (22%), mutual funds (19%), securities and commodities intermediaries (1%) and others (8%), including credit Unions.
Many Financial Institutions in Canada have become more active in abroad. Canada's expansion over the Globe have enabled them to grow in spite of the maturity of Canadian Financial market. 55 percent of the revenue is from the foreign operations of Canadian Life insurance companies.
United States is considered as the key foreign market for Canada. A number of Canadian Insurance Industries have substantial interest beyond the US, for example South East Asia and a lesser extent in Latin America and Europe.
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