Xactware’s 2015 Property Report highlights increase in reconstruction costs in Canada
Rebuilding costs rise 3.31 per cent, largely driven by improving economy
LEHI, Utah – Severe weather was down in Canada in 2015, and new construction and remodeling were both on the rise in 2015, according to the recently released Xactware’s 2015 Property Report for Canada. Xactware is a Verisk Analytics (Nasdaq:VRSK) business.
Reconstruction costs also grew 3.31 per cent at the nation level in 2015, and Xactware cost research showed the increase was the result of increased economic activity. The report shows storm activity resulted in $509 million of insured losses in 2015, which was much lower than 2014’s $878 million, according to the report.
“Construction costs remained fairly stable in 2015,” said Rob Lund, Xactware’s manager of Structural Data Services. “Increased costs for labour — especially in regions where home construction activity is up — along with the costs of some key materials, were the primary reasons for the growth in construction costs.”
Xactware’s annual property report provides information about important trends in the Canadian property insurance industry. In addition to an in-depth overview of property claims and reconstruction costs, Xactware’s 2015 Property Report for Canada includes cost trends for commonly used building materials (such as lumber, drywall, and roof shingles) and reconstruction labour. The report is based on research conducted by Xactware’s pricing data services team and on claims processed throughout 2015 by Xactware’s claims management and analytical network, XactAnalysis®.
“In 2015 we saw a pronounced reduction in severe weather activity. Correspondingly, new construction and remodeling accelerated, affecting pricing trends throughout the year,” said Xactware President Mike Fulton. “In fact, although housing starts increased for seven consecutive months, the value of new home building was eclipsed by spending on remodeling. This report examines the impact of 2015 trends more closely.”