Applied Systems reports slower growth in Canada’s commercial insurance space in Q2’25

Applied Systems, a provider of cloud-based insurance software and services, has released its second-quarter 2025 edition of the Applied Commercial Index, offering detailed insights into premium renewal trends across Canada’s commercial insurance sector.

According to Applied Systems, the average renewal rate increase slowed across all major commercial lines when compared to the same period in 2024.

The overall average premium renewal rate in Q2 2025 was 3.63%, down from 5.83% in Q2 2024. All business categories analysed showed a year-over-year decline in renewal rate changes.

The quarter-over-quarter results presented a more varied picture.

Real Estate Property, Business and Professional Services, and Construction all experienced lower average renewal rates compared to the previous quarter. On the other hand, Hospitality Services and Retail Services saw slight increases.

In Business and Professional Services, the average premium renewal rate dropped to 3.00% in Q2, down from 3.99% in Q1 2025. Construction, Erection, and Installation Services followed a similar trend, with rates falling to 3.56%, compared to 3.85% the previous quarter. Real Estate Property also saw a modest decline, with renewal rates averaging 3.38%, down from 3.58%.

Conversely, the Hospitality sector recorded a sharp increase in renewal rates, rising to 4.53% from 3.08% in Q1. Retail Services saw a smaller rise, with average rates increasing slightly to 4.62%, up from 4.57%.

“This quarter’s average premium renewal rate change continues to decrease across the most commonly placed commercial lines of business, except Hospitality Services which saw a spike,” added Steve Whitelaw, SVP and General Manager, Canada, Applied Systems.

“As we make our way into the second of the year, the Applied Commercial Index will shine light on how current macro trends such as US tariffs and others will affect rates.”