Severe weather events caused insurance at some Alberta school districts to increase by more than 300%

The Alberta government said Foothills is one of nine school boards that have "recently experienced substantial property damage, primarily from natural disaster events," and are now seeing considerable increases to the cost of their insurance as a result.

9 Alberta school boards account for more than $180M in claims over the last decade

Natural disasters like the 2016 wildfires near Fort McMurray are to blame for the increase in insurance premiums at some Alberta school districts. (Mark Blinch/Reuters)

Over the last two years the Foothills School Division says the cost of its insurance has skyrocketed — with premiums more than quadrupling.

Drew Chipman, superintendent of corporate services for the school division, said two years ago it was paying $560,000 for insurance.

Now, it is paying nearly $2.5 million.

"Which is just crazy numbers for a school that is our size," Chipman said. "Significant increases that are just difficult for for us to manage, as well as some other boards."

The Alberta government said Foothills is one of nine school boards that have "recently experienced substantial property damage, primarily from natural disaster events," and are now seeing considerable increases to the cost of their insurance as a result.

Those school divisions are: 

  • The Battle River School Division
  • Christ the Redeemer School Division 
  • Accueil Conseil scolaire Centre-Nord
  • Foothills School Division
  • Fort Vermilion School Division
  • Northland School Division
  • Holy Family Catholic Regional School Division
  • Fort McMurray Roman Catholic Separate School Division
  • Fort McMurray Public School Division

"Ours and some of the others [are seeing increases] due to the floods in 2013. A number of boards due to forest fires back in 2017," Chipman said.

"And then again, there were floods in a number of boards this spring and all of those catastrophic losses have put us behind the 8-ball."

Insurance policies

Scott McFayden, associate superintendent of corporate supports and services with the Parkland School Division, is the board chair of the Alberta Risk Managed Insurance Consortium (ARMIC), which represents 37 school districts, including the aforementioned nine.

Scott McFayden says without the ARMIC reciprocal, it's likely these school districts would be uninsurable. (Parkland School Division)

He said in order to get an insurance policy for the nine boards with significant claims history, it was necessary to take out a policy for the 37 rural and northern boards together, as no insurer would separate out the high-risk history boards from the other boards with low-risk history.

"A vast majority of boards in ARMIC will have lower property rates. What we have on the other side is the board that we call the 'Pool B' boards, and they're in areas where there's a high frequency of catastrophic losses, so it's the flooding and wildfires," he said.

McFayden said over the last few years, the insurance market has continued to harden. 

"When you look at it from an insurance company point of view — not that I like doing that too often — but they had $220 billion in losses in 2020 and about $140 billion in 2019," he said.

"When you bring it down to Alberta, which is our market, generally speaking an insurer will plan for a catastrophic event every five to 10 years — we've had four in the last seven years, basically every other year … take that along with the low interest rates and that affects their revenues as well."

McFayden said when you look at the claim history of the boards experiencing higher rates, it's easy to see why it's become more expensive for them. 

"They've had $180 million in claims over 10 years. When you compare that to the other 28 boards, they've only had $30 million in claims in that same 10 years," he said. 

"Honestly, those boards are almost uninsurable if they weren't part of our reciprocal."

Marsh, the insurance brokerage and risk management group providing ARMIC with insurance, declined to comment for this story. 

Honestly, those boards are almost uninsurable if they weren't part of our reciprocal.- Scott McFayden, board chair of the Alberta Risk Managed Insurance Consortium

"Unfortunately, we are unable to comment about the specific circumstances of this insurance placement," said Colleen Vecsi, communications operation leader for Marsh.

6 of Canada's costliest claims

Rob de Pruis, director of consumer and industry relations for the Insurance Bureau of Canada (IBC), said of the top 10 costliest claims in our nation's history related to severe weather events, six of them happened in Alberta.

"Five of those six happened in this decade. We can think of the 2016 Fort McMurray wildfire and the 2013 flooding that happened in Calgary and southern Alberta," he said.

This year, de Pruis said Calgary saw the costliest hail event in Canada's history and last year the province also had some very significant wildfire activity in northern Alberta.

"That did impact a number of the schools throughout the province with smoke damage," he said. "Wildfire and flood damage, those claims can be very costly to be remediating."

Chipman said so far, most school divisions have been able to forestall impacts to their budgets. 

"We worked with the province last year and they enabled us to use some money that we usually use on building renovations to use toward covering insurance costs," he said.

"This year it's come as another big surprise. So we're hoping that the province will step up and help us to cover those big increases."

Drew Chipman, superintendent of corporate services for the Foothills School Division, says two years ago it was paying $560,000 for insurance. Now, it is paying nearly $2.5 million. (Foothills School Division)

Chipman said if these increases continue at the same rate seen over the last two years, eventually there will be a direct impact on school division operations. 

"When you look at where school divisions spend their money, it's staffing," he said. "There's really no other way that we spend our money. It's teachers in a classroom. It's educational assistants. It's principals. It's support staff.

"So if you're looking at those types of dollars at the end, if we don't get some additional support, that's where the board will have to look to make decisions as to how they're going to meet those increased costs."

In a written statement, the province said an order in council was recently signed that provides security for many rural school boards across Alberta that were unable to access the necessary insurance.

"Alberta's government has agreed to provide funding up to a total of $15 million per year to pay for a deductible under a single insurance policy for the school boards," said Jerrica Goodwin, spokesperson for Alberta Treasury Board and Finance.

"Providing financial support to these school boards will help them become insurable again in the future, ensuring that the facilities students attend will be safe and protected."

'Very tough market conditions'

According to de Pruis, the big picture is that the commercial insurance market across the country is seeing some "very tough market conditions."

"Claims are certainly a really big driver of that. We are seeing just a lot of frequency and severity of claims across the country. Severe weather is another factor and low interest rates are a factor in that as well," he said.

But, de Pruis said residential properties located in the same places as the school divisions aren't seeing their property insurance rates climb at the same steep rate.

"We're not seeing that at the same level," he said.

De Pruis said that's because in the commercial insurance market, risks are being looked at a lot more closely than they have in the past to try to anticipate the types of claims that could be having an impact.

"Overall costs of commercial properties are typically significantly higher than residential properties as well," he said.

"One commercial claim could be the same dollar amount as dozens of residential claims from that perspective, so it's also looking at the overall costs of the claims and the overall replacement values of some of these properties."


Lucie Edwardson


Lucie Edwardson is a reporter with CBC Calgary, currently focused on bringing you stories related to safety on Calgary Transit. Follow her on Twitter @LucieEdwardson or reach her by email at


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