5
3.2 Life and Health Insurers Demonstrated Appetite and Expertise in P3 Investments
Canadian life insurers have participated in P3 projects ranging from roadways and public transit to public
buildings and hospitals across Canada. Moreover, the industry has a strong desire to do more.
P3 infrastructure investments are a particularly attractive asset class for insurers. The long-term nature
and the predictable long-term cash flows provided by infrastructure assets are highly suitable for
matching insurers' long-term liabilities, particularly in markets where issuance of long-term bonds is
limited. In addition, life and health insurers like P3 investments due to the portfolio diversification
benefits they provide. The industry played a leadership role in the development of the P3 market in
Canada, including through the financial crisis. As this market has matured, however, P3 investments
have attracted a broader range of investors beyond the traditional long-term investor groups of the
insurance and pension fund sectors.
There are a number of estimates on the need for infrastructure investments in Canada but the
conclusion is the same -- significant investment is required. For example, the Federation of Canadian
Municipalities estimated the infrastructure deficit was $123 billion to maintain existing municipal
infrastructure and a further $115 billion to fund new municipal infrastructure needs. When federal and
provincial needs are included, the Canadian infrastructure deficit could be between $350 and $400
billion.
6
While Canada's P3 market is relatively robust, the above statistics demonstrate that more must
be done.
6
PWC. Building Canada's Infrastructure. http://www.pwc.com/ca/en/infrastructure-project-finance/financing-the-
future.jhtml
Select P3 Deals that Canada's Life and Health Insurers have participated in
A robust infrastructure system is critical to economic growth and to maintaining Canadians' standard of living.
Canada's life and health insurers have played a key role in funding a number of critical infrastructure projects
across Canada.
Hospital and Healthcare
Rainbow Hospital Partnership
Providence Care Hospital
Restigouche Hospital Centre
Mass Transit / Roads
City of Ottawa light-rail transit
Edmonton's Anthony Henday highway
Airports
Iqualuit Airport
Government Services
CSEC call intercept centre
RCMP headquarters relocation (Green Timbers)
Thunder Bay Courthouse
