Quebec Insurers Urge Parties to Limit New Building in High-Risk Areas as Election Approaches

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Quebec’s coming election is putting an increasingly expensive question in front of political parties: how much new development should be allowed in places where floods and other natural hazards are already difficult to insure? On August 25, the Insurance Bureau of Canada called for stronger land-use rules, more assistance for municipalities and greater financial support for homeowners making properties more resilient. The intervention comes only days before Quebec’s provincial election is expected to be called, with voting scheduled for October 5. Recent disasters have given the debate added urgency. Quebec has experienced record-breaking insured flood losses, while new flood maps and regulations are already changing how risk is considered in communities across the province. The insurers’ argument is straightforward: preventing new exposure could ultimately cost less than repeatedly rebuilding after disasters.

Insurers Put Climate Resilience on the Election Agenda

The Insurance Bureau of Canada’s Quebec branch is asking political parties to treat disaster resilience as a long-term economic issue rather than simply an emergency-management problem. Its August 25 recommendations centre on three measures: stronger incentives for homeowners to protect their properties, greater support for municipalities adapting infrastructure, and tougher land-use planning that limits new construction in the areas facing the greatest natural-hazard risks. The organization argues that repeatedly adding buildings and infrastructure to vulnerable areas increases the number of people and properties that will eventually need protection, emergency assistance or reconstruction.

The timing gives the proposal political significance. Quebec’s next provincial election is scheduled for October 5, 2026, and Élections Québec has said the fixed-date campaign should be called no later than August 29 unless an earlier election is triggered. That means industry groups are presenting priorities just as parties finalize campaign commitments. Insurance Bureau of Canada vice-president Laurent Fafard described resilience as a shared responsibility involving governments, municipalities, insurers, businesses and residents. For political parties, the challenge is turning that broad principle into rules determining where communities expand and how existing neighbourhoods are protected.

Quebec’s Recent Losses Make the Warning Hard to Ignore

The insurance industry does not have to reach far into the past to demonstrate the financial consequences of extreme weather. Flooding caused by the remnants of Hurricane Debby in August 2024 produced nearly $2.5 billion in insured damage in Quebec, according to Catastrophe Indices and Quantification data cited by the Insurance Bureau of Canada. It became the province’s costliest insured disaster, surpassing the 1998 ice storm. The losses involved flooded homes, vehicles and businesses across Montreal and other parts of southern Quebec, turning what might once have been viewed as an extraordinary weather event into a major balance-sheet shock.

The pressure has continued. Flooding in Montreal and surrounding municipalities on June 20 and 21, 2026, caused more than $409 million in insured damage. The late-March 2025 ice storm affecting Quebec and Ontario ultimately generated an estimated $466 million in insured losses. Those events do not mean every community faces the same risk, but they illustrate why insurers increasingly focus on exposure before buildings are constructed. Statistics Canada has also documented rising catastrophe costs nationally, finding that every year from 2020 through 2025 ranked among Canada’s 10 costliest years for extreme-weather claims since tracking began in 1983.

The Biggest Ask Is to Stop Creating New Risk

The most consequential part of the insurers’ proposal concerns land-use planning. The industry wants governments and municipalities to limit new construction in areas facing the highest flood or other natural-hazard risks. The reasoning is fundamentally different from simply making insurance more generous after a disaster. A new subdivision placed in a repeatedly flooded location can create decades of future exposure involving homes, roads, sewer systems and public services. Avoiding that exposure at the planning stage can eliminate risks that expensive engineering or insurance products may never fully solve.

Quebec has already moved significantly in this direction. A modernized regulatory framework for water environments took effect on March 1, 2026. Under the province’s new-generation flood-zone system, new residences are prohibited in areas classified as having very high, high or moderate flood intensity. Construction may still be permitted under certain conditions in lower-intensity zones and some already-developed sectors. Older flood maps remain in force in areas awaiting replacement. The insurers’ election intervention therefore is not a demand to begin regulating from scratch. It is a push toward making risk avoidance an even more central and consistent principle in future development decisions.

New Flood Maps Could Change What Communities Consider Buildable

Quebec’s approach to flood risk is also becoming more detailed because the underlying maps are changing. Beginning in spring 2026, the province started progressively publishing a new generation of flood-zone maps. As each new map becomes effective, it replaces the older mapping for that area or provides information for places that previously lacked comparable coverage. The methodology incorporates current and future flood hazards and considers how those hazards may evolve with climate change. Residents can now use a provincial interactive tool to check whether individual properties fall within mapped flood zones or watercourse-mobility areas.

That matters because maps can influence much more than emergency planning. They can shape municipal permitting, development decisions and the practical risk assessment surrounding a property. CAA-Quebec has warned homeowners that updated flood mapping can have consequences for insurance, mortgages and property decisions. The transition will take years, meaning some communities will operate with new-generation maps while others temporarily continue using older information. For insurers, better mapping supports the argument that governments should use the best available risk data before permitting additional construction rather than discovering the extent of vulnerability after homes are already occupied.

Homeowners Are Also Being Asked to Make Existing Homes Tougher

Restricting risky new development addresses future exposure, but it does little by itself for families already living in vulnerable neighbourhoods. That is why the Insurance Bureau of Canada is also calling for stronger financial incentives for property-level adaptation. Measures highlighted by the industry include installing backwater valves, improving drainage and adding flood-protection equipment. These are comparatively small interventions when measured against the cost of rebuilding a severely damaged basement or relocating a household, but homeowners may still postpone them when renovation budgets are already stretched.

Quebec has begun putting substantial public money behind that approach. The province’s 2026-27 budget committed $425 million over five years to a new Rénoclimat adaptation component designed to help homeowners make properties more resilient. The program is scheduled to begin October 1, 2026. Planned assistance includes support for measures such as battery-backed sump pumps, backwater valves, removable flood barriers and professional risk assessments, with additional support available for more substantial work. The election debate is therefore likely to focus less on whether adaptation deserves funding and more on whether existing programs are large, accessible and targeted enough for the scale of the risk.

Municipal Infrastructure Is the Other Half of the Problem

A homeowner can install a backwater valve, but that does not prevent an entire neighbourhood’s drainage system from being overwhelmed during an intense rainstorm. The insurers therefore want greater provincial support for municipalities responsible for planning, maintaining and adapting local infrastructure. Quebec’s own stormwater programs acknowledge the problem: intensifying rainfall places additional strain on sewer networks and wastewater-treatment infrastructure. Measures such as better drainage, reducing impermeable surfaces and managing rainwater closer to where it falls can reduce the volume entering municipal systems during peak events.

Quebec is already committing billions of dollars to municipal and public infrastructure, but climate adaptation competes with a long list of other needs. The 2026-2036 Quebec Infrastructure Plan allocates $7.3 billion to the municipalities sector after adding nearly $378 million in new funding. Separate programs provide assistance for stormwater management, flood resilience and local climate-transition projects. Municipalities with flood-protection structures have also faced new monitoring and maintenance obligations since March 2026. The Insurance Bureau’s argument is that these efforts need to become more systematic because protecting individual properties has limited value when the roads, sewers and drainage infrastructure surrounding them remain vulnerable.

Housing Pressure Makes Limits on Development Politically Complicated

Telling municipalities to build fewer homes in risky areas comes at an awkward moment because Quebec is simultaneously under intense pressure to increase housing supply. Greater Montreal recorded 23,089 purpose-built rental starts in 2025, the highest level in CMHC data going back to 1990. Additional construction helped raise the purpose-built rental vacancy rate to 2.9%, easing some of the extreme tightness seen earlier in the decade. Yet affordability remains a problem: CMHC reported that the most affordable rental units were still scarce, while the average rent for a two-bedroom purpose-built apartment reached $1,346 in 2025, up 7.2%.

That creates a genuine planning trade-off rather than a simple choice between building and not building. Construction and housing groups are pressing political parties to reduce barriers and accelerate new supply, while insurers are warning that putting that supply in the wrong locations can lock communities into future disaster costs. The two objectives do not necessarily conflict. More housing can still be built through denser development, redevelopment and expansion in lower-risk areas. The election question is whether governments are willing to make risk location as important as the raw number of homes approved.

Insurance Costs Show Why Prevention Is Becoming an Affordability Issue

Climate resilience is increasingly connected to household affordability because insurance prices already reflect a broader rise in claims, rebuilding expenses and property risks. Statistics Canada found that Quebec homeowners’ home and mortgage insurance prices increased 30.8% between December 2020 and December 2025. The agency cautioned that extreme weather is only one driver: replacement costs, construction prices, wages and other expenses also matter. Still, its analysis found that insurers are increasingly linking premiums, coverage limits and underwriting decisions to the specific risk characteristics of homes and neighbourhoods.

Flood coverage illustrates the divide. An Insurance Bureau of Canada analysis released in July 2026 estimated that roughly 94% of Canadian residential properties are now eligible for overland flood insurance, a major expansion from a decade earlier. The remaining 6% are disproportionately located in high-risk areas where coverage can be unavailable or too expensive. Federal consumer guidance similarly notes that very high flood risk can lead insurers to charge higher premiums, impose different deductibles or decline coverage. Meanwhile, Ottawa’s proposed national flood insurance program for high-risk households remains under development. For Quebec’s political parties, where new homes are built could therefore influence not just future disaster bills, but whether those homes remain realistically insurable.

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