Canada's defence landscape is undergoing a generational shift. With a commitment to reach 5% of GDP in defence spending by 2035, the federal government has set in motion what will likely become the largest sustained construction program this country has seen in decades. For the surety industry, the pipeline is significant and the implications run deeper than the headline numbers suggest.

Direct military construction alone accounts for $45B+ in active projects. NORAD modernization, CF-35 fighter infrastructure, naval recapitalization, and military housing represent multi-year, multi-site programs spanning every region of the country. Layered on top is an estimated $250B in dual-use infrastructure (roads, ports, airstrips, and energy systems serving both civilian and defence purposes) anchored by the $40B+ Arctic and Northern Plan. Municipal and community investment tied to base expansions adds further depth to the pipeline.

The domestic procurement target of 70% is a deliberate policy choice to build Canadian industrial capacity. That means factory expansions, new manufacturing facilities, shipyard upgrades, and critical minerals infrastructure -- all of it requires bonds. Boston Consulting Group estimates the combined construction-related investment at $350--400B+ over the decade. This is not a one-time spike. It is a sustained, phased demand curve.

For surety underwriters, the opportunity is real, but so is the work required for our clients to capture it responsibly. Project sizes are large, with several programs exceeding $1B. Geographies are challenging, with Arctic and Northern builds carrying material cost overrun, logistic, labour and execution risk. The domestic procurement push will draw mid-size and emerging contractors into defence work for the first time, firms with limited track records in this sector and balance sheets that may not yet reflect the complexity or scope of what they are bidding. The pipeline rewards preparedness and sound risk management. Underwriters who understand the procurement landscape, know their contractors, and apply disciplined capacity management will be well-positioned. Those who treat this influx of capital investment as an easy means to grow their top-line may find the risks more demanding than anticipated.

For Trisura, the scale and duration of this pipeline reinforces our commitment to the Canadian construction market. Our underwriting team brings the expertise and capacity to support brokers and contractors as defence-related work grows in complexity and volume.