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Definity Financial Corporation
Definity sells home, car, and business insurance to Canadians, and pays out when things go wrong.
Definity is a Canadian insurance company. It sells property and casualty insurance — the everyday kind that covers your house, your car, your farm, or your small business — to individuals and companies across Canada. You pay it a premium every month or year, and in exchange it promises to pay for repairs or losses when something goes wrong, like a burst pipe, a fender bender, or a fire.
The business works like a big shared piggy bank with a catch. Definity collects money from millions of customers, invests that money while it waits, and pays out claims from the pot. If premiums and investment income beat claims and expenses, it keeps the difference. Its main brands in Canada include Economical Insurance, which sells through brokers, and Sonnet, a direct-to-consumer online insurer that lets people get a quote in minutes without talking to anyone. It also owns a pet insurance business called Petline. Customers choose insurers like Definity mostly on price and on how smooth the claims experience is, and they often stay for years because switching is a hassle. Insurance in Canada is a crowded, competitive market. Definity competes with other big Canadian insurers such as Intact Financial and Fairfax Financial, plus bank-owned insurers and smaller regional players. Definity itself is a relative newcomer as a public company: it was owned by its policyholders as a mutual insurer for decades, then demutualized and listed on the Toronto Stock Exchange in late 2021. It has been buying up smaller brokerages and insurance businesses since, using its cash to grow rather than just sitting on it.
The key thing to understand about insurers is that they make money two ways. First, from underwriting — charging more in premiums than they pay in claims and costs. Second, from investing the "float," which is the money customers pay upfront before claims come due. That float gets invested in bonds and other assets, and the returns add up. A bad year of storms, wildfires, or floods can wipe out underwriting profits fast, which is why insurers obsess over pricing risk correctly. Definity, like its peers, has had to raise premiums sharply in recent years as inflation pushed up the cost of repairing homes and cars, and as severe weather events became more frequent and expensive.
Saved answer · last researched 12 Nov 2026