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TORONTO – May 11, 2026 – Consumer insolvencies rose in the first quarter of 2026, with 37,121 Canadians filing a consumer insolvency, according to the latest data from the Office of the Superintendent of Bankruptcy (OSB). The Canadian Association of Insolvency and Restructuring Professionals (CAIRP) notes this is the highest quarterly volume of consumer insolvencies since 2009 and is equivalent to roughly 17 Canadians filing for insolvency every hour during the quarter, on average, reflecting the sustained financial strain many households continue to face amid higher living costs, elevated debt loads, and heightened economic uncertainty. Consumer insolvencies rose 8.5% in the first quarter compared to the same quarter last year.

“The latest consumer insolvency data suggests more Canadians are reaching a financial breaking point,” says Wesley Cowan, Licensed Insolvency Trustee and Vice Chair of the Canadian Association of Insolvency and Restructuring Professionals. “The concern is that many households are entering this next period of economic uncertainty already carrying debt they can no longer comfortably manage. When borrowing costs, employment conditions, and everyday expenses are uncertain, debt problems can become much harder to reverse without formal relief.”

Compared to the previous quarter, consumer insolvencies were 6.5% higher in the first quarter of 2026. For the 12-month period ended March 31, 2026, insolvencies filed by consumers increased 4.2% compared to the 12-month period ended March 31, 2025.

With inflationary pressures re-emerging and the outlook for interest rates becoming less certain, many Canadians are managing debt in a less predictable economic environment. Volatility in energy prices, trade uncertainty, and uncertainty around employment can make it harder for indebted households to budget and plan ahead.

Cowan says insolvency is often the result of months or years of financial pressure, rather than one isolated event.

“For someone already under financial strain, it does not always take a major crisis to trigger insolvency,” explains Cowan. “A job disruption, missed payment, rent increase, relationship breakdown, or unexpected expense can be enough to push someone past the point where they can recover on their own.”

Those tipping points can be harder to absorb when households are already relying on credit or delaying payments to manage everyday costs. By the time debt balances are growing faster than they can be repaid, the issue is no longer just monthly budgeting, but whether the debt itself is sustainable.

“When people are trying to keep up with rising costs while carrying growing debt balances, they can appear to be managing financially until suddenly they are not,” says Cowan. “That often delays the point at which someone reaches out for help, and by then, their options may be more limited. Seeking advice from a professional early can help preserve more financial recovery options before the situation escalates.”

As more Canadians face serious debt challenges, Cowan says it is important for individuals to understand where they can turn for regulated, trustworthy guidance. Licensed Insolvency Trustees are the only federally regulated debt professionals in Canada authorized to administer debt-relief options such as consumer proposals and bankruptcies. They are legally and ethically required to assess each individual’s full financial situation and provide accurate, unbiased advice on all available debt-relief options.

“Debt problems can be overwhelming, and the help options available to people are not always clear without professional guidance,” says Cowan. “For many people, the first step is not deciding whether to file a consumer proposal or bankruptcy. It is understanding whether their debt can still be managed informally, whether legal protection is needed, and what each option would mean for their long-term financial recovery. Because Licensed Insolvency Trustees are federally regulated, Canadians can feel confident they are receiving accurate, unbiased guidance based on their full financial situation.”

Initial consultations with a Licensed Insolvency Trustee are generally free. To find a government-regulated Licensed Insolvency Trustee, Canadians can visit: www.cairp.ca/find-a-lit.html.

Across the provinces, British Columbia had the highest rate of increase year-over-year in consumer insolvencies in the first quarter of 2026, rising 16.2% to 4,234 filings. This was followed by Prince Edward Island, which experienced a 15.3% increase to 166 filings, and Ontario, which saw a 14.7% increase to 13,913 filings.

Business Insolvencies Decline Year-Over-Year, but Quarterly Increase Signals Continued Financial Pressure

Business insolvencies in Canada declined by 7.5% in the first quarter of 2026 compared to the same quarter last year, with 1,232 businesses filing for insolvency. Yet while business insolvencies dropped year-over-year, they were 9.8% higher in the first quarter of 2026 compared to the previous quarter, against a backdrop of softer demand, higher fuel and input costs, still-elevated borrowing costs, and renewed uncertainty around trade, tariffs, and supply chains.

Filings also remain 27.6% above the first-quarter pre-pandemic average, underscoring that the operating environment remains challenging for many businesses. For the 12-month period ended March 31, 2026, insolvencies filed by businesses were 14.1% lower than the 12-month period ended March 31, 2025.

“The increase in business insolvencies compared to last quarter is a reminder that financial pressure on Canadian companies remains significant,” says Craig Munro, Licensed Insolvency Trustee and Vice Chair of CAIRP. “While filings remain below the elevated levels seen at this time last year, many businesses are still operating in an environment marked by high costs, tighter margins, and ongoing economic uncertainty.”

He says many Canadian businesses continue to face a challenging operating environment shaped by higher financing costs, fluctuating input prices, softer consumer demand, and ongoing uncertainty around trade and supply chains. Unpredictable tariffs, supply chain disruptions, and cautious consumer spending can make it more difficult for businesses to price products, manage inventory, invest confidently in growth, or determine whether financial pressures are temporary or part of a longer-term shift. For otherwise viable businesses, the insolvency system can provide a structured path to stabilize operations and address debt challenges before they lead to sudden closures, job losses, or broader impacts on employees, suppliers, creditors, and local communities.

 “When a business is under pressure, the right path is not always obvious,” says Munro. “A Licensed Insolvency Trustee can help separate short-term cash-flow pressure from deeper viability concerns, so decisions about restructuring, creditor negotiations, or an orderly wind-down are made with a clearer view of the risks and obligations involved.”

Restructuring can help create breathing room for viable businesses to address debt, stabilize operations, and preserve value for creditors, employees, suppliers, and the broader community. Licensed Insolvency Trustees provide an impartial assessment of the business’ financial position and can help owners understand whether restructuring, creditor negotiations, a proposal, receivership, bankruptcy, or an orderly wind-down may be appropriate.

The sectors experiencing the largest increases in the number of insolvencies in the first quarter of 2026 compared to the same quarter last year were Management of Companies and Enterprises (46 filings, up 17), Construction (208 filings, up 15), Other Services (except Public Administration) (73 filings, up 11) and Finance and Insurance (26 filings, up 10). The sectors accounting for the largest share of business insolvencies in the first quarter of 2026 were Construction (17.0%) and Accommodation and Food Services (13.9%).

ABOUT CAIRP 

The Canadian Association of Insolvency and Restructuring Professionals (CAIRP) is the national professional association representing close to 1,400 members and associates. CAIRP members have earned the CIRP designation, and most are licensed insolvency trustees (LIT) providing insolvency and restructuring services to consumers and businesses who experience financial challenges. CAIRP is a national voice on insolvency matters throughout Canada.

For more information visit: www.CAIRP.ca

CONTACT

Angela Joyce, Media Relations

p. 1.403.681.9286
e. aj@whiterabbitpr.com