TD Insurance President and CEO James Russell says the country's largest direct-to-consumer home and auto insurer is deploying artificial intelligence and advanced modeling to navigate what he said was a historic year in natural disaster losses.
"2024 was the worst year for catastrophic loss in Canadian history with industry-wide insured damages from severe weather events surpassing $8.8 billion," Russell told investors at TD Bank's recent Investor Day.
Canada’s insured catastrophe losses reached a record C$8.5 billion in 2024, fueled by Calgary’s historic hailstorm at about C$3.2 billion, flooding from Hurricane Debby’s remnants at C$2.806 billion, and the Jasper, Alberta wildfire at roughly C$880 million.
In 2025, insured losses have already surpassed C$1 billion, led by the March Ontario–Quebec ice storm at C$490 million, July Calgary hail at C$164 million, and July Quebec floods at about C$120 million., according to CatIQ.
The loss trend prompted TD Insurance to implement what the company describes as its most comprehensive risk management overhaul in decades.
TD Insurance made "hundreds of changes to our pricing and product design while strengthening reinsurance coverage" over the past year, Russell explained. The cat loss trend also prompted TD to become the first insurer in Canada to issue a Canadian dollar-denominated cat bond.
Toronto-Dominion Bank issued the first Canadian dollar–denominated catastrophe bond in earlier his year in a CA$300 million deal providing protection against North American natural disasters through 2028.
Executives said the insurer's risk modeling strategy centers heavily on proprietary data and artificial intelligence.
With over 4 million clients generating "10 million client interactions each year," TD Insurance has built what Russell called a data advantage. "Those millions of interactions enable smarter targeting and risk selection," he noted, adding that "the more we grow, the better we become at generating new data and insights, scaling faster and responding to trends."
TD Insurance's usage-based insurance platform, TD My Insurance, has "collected billions of driving data points, offering discounts to good drivers while also predicting broader trends," Russell said. During the pandemic, the company "compared client movement to Apple's open source mobility data to guide pricing decisions," demonstrating real-time model adaptation capabilities.
The company is targeting over "$200 million in AI-driven benefits over the medium term" through its analytics centers of excellence. Russell emphasized that "analytics and risk selection are the foundation of any successful insurance company," noting that TD's analytics now "drive acquisition and targeting, enable next best action recommendations to boost client loyalty, predict emerging claims trends and trigger proactive preventative measures."
Despite the catastrophe environment, TD Insurance maintains aggressive growth targets, aiming to "double our general insurance premiums to more than $13 billion over the medium term."
