2025 Claims Trends: What Clients Should Know to Strengthen Risk Management
The MEARIE Group’s 2025 Annual Cause of Loss Analysis Report presents a comprehensive review of claims activity across liability, vehicle, and property programs from 2020 to 2024. Although overall claim frequency and severity have declined, several emerging risks and persistent loss types warrant close attention. Here are the key trends and recommendations intended to help our Members proactively manage risk.
Key Trends to Watch
Cyber Claims Are Rising in Severity
Although cyber/privacy breach claims remain infrequent, their fiscal impact has grown significantly in recent years. MEARIE observed a notable increase in the severity of cyber-related claims, with two incidents in 2022 alone resulting in payouts totaling greater than $500,000. This trend underscores the importance of proactive cybersecurity measures for organizations of all sizes. As cyber threats evolve in complexity and scale, even a single breach can lead to substantial financial and reputational damage. Industry research supports this concern, with IBM reporting that the global average cost of a data breach reached $4.45 million in 2023—an all-time high—driven by longer lifecycles and increased regulatory penalties (IBM Security, 2023).[i] These findings highlight the urgent need for clients to strengthen their cyber defenses through measures such as regular audits, robust authentication protocols, employee training, and comprehensive insurance coverage.
Recommendation:
To effectively manage the rising risk of cyber-related claims, clients should adopt a multi-layered approach to cybersecurity. Regular cybersecurity audits are essential to find vulnerabilities and ensure compliance with best practices. Implementing multi-factor authentication and endpoint protection can significantly reduce the likelihood of unauthorized access and data breaches. Additionally, staff training on phishing awareness and secure data handling protocols are critical to building a resilient organizational culture. Clients should also review their cyber insurance coverage, including limits and deductibles, to ensure adequate protection against increasingly severe claims. These recommendations align with broader industry guidance, which emphasizes that human error stays a leading cause of cyber incidents and that initiative-taking measures can mitigate risk (Verizon, 2024).[ii]
Equipment Failure Remains the Most Costly
Equipment failure remains a major concern, representing 15% of liability claim severity and 50% of property-related losses. Common issues stem from transformer malfunctions, underground burn-offs, and the challenges posed by aging infrastructure.
Recommendation:
To address these persistent equipment-related exposures, organizations should prioritize regular inspections and preventive maintenance for all critical assets. Preventive maintenance not only reduces unplanned downtime and costly repairs but also extends the service life of equipment and mitigates potential safety hazards. Asset lifecycle reviews—comprehensively assessing the condition, age, and failure risk of infrastructure—are equally essential for making informed investment decisions about replacements or upgrades. Where the likelihood or consequence of failure is high, targeted investments in modernization can significantly reduce both operational and claims costs.
MEARIE’s increased inspection protocols in 2023 offer a strong example of initiative-taking loss mitigation and can serve as a template for other organizations aiming to strengthen their risk management frameworks. Industry research supports this approach; according to the International Facility Management Association (IFMA), organizations that implement systematic preventive maintenance programs report, on average, a 15-20% reduction in equipment-related incidents and total maintenance costs compared to those relying on reactive repairs (International Facility Management Association, 2022).[iii]
By combining these strategies—routine inspections, preventive maintenance, lifecycle analysis, and strategic upgrades—clients can better safeguard operations, reduce liability exposure, and ensure long-term reliability of their infrastructure.
Theft Is the Most Frequent Property Claim
Theft continues to be the most frequently reported cause of property loss among MEARIE members, accounting for 29% of all property claims between 2020 and 2024. This trend is consistent with broader industry findings, which show that theft and burglary remain among the top causes of commercial property losses, particularly in sectors with high-value mobile assets (Insurance Bureau of Canada, 2023).[iv] These incidents typically involve yard break-ins and the theft of equipment stored in vehicles, reflecting vulnerabilities in physical security measures across operational sites. Although the financial severity of theft-related claims remains relatively low, the frequency of such claims has been steadily increasing, signaling a growing exposure that warrants attention.
Recommendation:
To address this trend, LDCs should consider implementing a layered security approach. This includes upgrading perimeter fencing, installing motion-activated lighting and surveillance systems, and securing high-value equipment in locked enclosures or vehicles. Regular security audits and staff training on theft prevention protocols can further reduce risk. Additionally, LDCs should review their insurance coverage to ensure deductibles and limits are aligned with current exposure levels. MEARIE has committed to reviewing theft mitigation strategies and enhancing risk management communications to support members in reducing theft-related losses.[v]
These recommendations align with broader industry guidance, which emphasizes that physical security and operational vigilance are critical to minimizing theft risk in utility environments (Insurance Bureau of Canada, 2023).
Collision Dominates Vehicle Claims
Collision remains the most dominant cause of vehicle-related claims in the MEARIE Fleet/Vehicle Program, accounting for 85% of all reported incidents and 66% of total claim severity over the five-year period from 2020 to 2024. This high frequency underscores the persistent exposure faced by fleet operators, particularly in environments with frequent road use and operational mobility.
Recommendation:
To reduce exposure and enhance operational safety, organizations should implement comprehensive fleet safety programs that include structured policies, driver qualification standards, and continuous improvement practices. Driver training should be both initial and ongoing, with coaching informed by telematics data to address risky behaviors and reinforce safe habits. Telematics monitoring enables real-time tracking and data-driven insights that support targeted interventions. MEARIE’s Fleet Safety Guide is a valuable resource that outlines best practices and supports alignment with insurance and risk management strategies, including blanket fleet coverage and accident benefits enhancements
Extreme Weather Events Are Increasing
Extreme weather events, such as severe storms, high winds, and flooding, have become an increasingly significant source of property claims for MEARIE members, particularly during the years 2022 and 2024. These powerful natural occurrences have resulted in substantial damage to infrastructure, including buildings, equipment, and utility lines. The frequency and intensity of these events are rising, with losses associated with wind, fire, and water damage reaching unprecedented levels.
These incidents not only increase direct repair costs but also contribute to business interruption and create additional challenges for long-term planning. For utility operators. MEARIE’s claims data reflect a clear trend: properties that lack adequate protection measures such as robust drainage systems, surge protection, and fire detection are disproportionately affected. As climate patterns shift and unpredictable weather becomes more common, strategic preparation and risk mitigation are essential for safeguarding operations and financial stability.
Recommendation:
Set up and routinely assess contingency plans to address weather-related disruptions, ensuring organizational preparedness for extreme events. Property owners should evaluate insurance coverage for adequacy in the face of increasing climate risks. They should systematically equip buildings with fire detection, robust drainage, and surge protection systems to mitigate losses. Research consistently proves that proactive measures such as regular risk assessments, infrastructure upgrades, and staff training significantly reduce both the likelihood and budgetary impact of severe weather claims (Smith & Matthews, 2022). Investments in resilience not only safeguard assets but also foster operational continuity during disruptive events.[vi]
Conclusion
By embracing these targeted risk management strategies, MEARIE members are well positioned to reduce their exposure, enhance claims outcomes, and cultivate lasting resilience in the face of evolving operational challenges. The adoption of layered security protocols, robust fleet safety programs, and comprehensive weather contingency planning is a proactive approach to threats both old and new. As incident trends reveal, physical security and operational vigilance —supported by ongoing staff training, infrastructure upgrades, and regular risk assessments- remain of paramount importance.
MEARIE’s commitment to supporting its members is demonstrated through the provision of expert guidance, advanced tools, and access to meaningful data-driven resources. By taking advantage of these offerings, organizations are empowered to safeguard their assets, minimize business interruption, and maintain operational continuity even as external risks grow in frequency and severity. Strategic investments in mitigation, resilience, and insurance adequacy foster not only financial stability but also a culture of preparedness and adaptability.
It is this blend of vigilance, preparation, and ongoing education that enables MEARIE members to navigate the increasingly complex risk landscape with confidence. Through collaborative knowledge sharing and the continual enhancement of best practices, the utility sector can move forward equipped to address current challenges and anticipate those of tomorrow with strength and foresight.
[i] IBM Security. (2023). Cost of a Data Breach Report 2023. https://www.ibm.com/reports/data-breach
[ii] Verizon. (2024). 2024 Data Breach Investigations Report. https://www.verizon.com/business/resources/reports/dbir/
[iii] International Facility Management Association. (2022). Operations and Maintenance Benchmarks Report. IFMA Foundation.
[iv] Insurance Bureau of Canada. (2023). Commercial property insurance trends and risk factors. https://www.ibc.ca/on/business/commercial-property-insurance
[v] Insurance Bureau of Canada. (2023). Commercial property insurance trends and risk factors. https://www.ibc.ca/on/business/commercial-property-insurance
[vi] Smith, J., & Matthews, R. (2022). Climate resilience in utility operations: Strategies for mitigating weather-related property losses. Journal of Risk Management in Infrastructure, 34(3), 210–225.
At The MEARIE Group, we remain committed to providing the most up-to-date insights on risk management and industry best practices. Should you have any questions or require further information, please do not hesitate to reach out.
