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Written by Katie Rook

Home insurance in Ontario

If you own a home in Ontario, you’re not required by law to have insurance. However, most lenders won’t provide a mortgage unless coverage is in place. As a result, most homeowners have it.

Protecting what is likely your largest asset has both financial and emotional benefits. In the event of a covered peril, you’ll be compensated. With that comes some peace of mind. An additional benefit that some overlook is that most home insurance policies also include liability protection. This means that if someone is injured on your property, you will also be protected financially.

If neither benefit persuades you, consider the practical reality of home ownership. Homes in Canada are increasingly impacted by damage from climate change. The Insurance Bureau of Canada reports that in 2021, insured damage for severe weather events reached more than $2 billion, ranking it as the sixth highest in insured losses since 1983.

Here, we outline some of the important details you need to consider when choosing coverage that’s right for you and your home.

Types of home insurance in Ontario

These are the most common types of home insurance coverage in Ontario.

Home insurance coverage

  • Property and building: This coverage protects both the structure(s) on your property, as well as the property itself, from a variety of perils. Protected incidents include fire, theft and water damage, among others. Because some policies may require additional coverage for secondary structures, like a garage or guest house, consult your insurer if anything is unclear.
  • Contents and personal property: Contents and personal property coverage protects your possessions, such as furniture, clothing and sports equipment, against theft and vandalism. Some items, like fine art and expensive jewelry, may not be protected under a standard policy. Excluded items can be protected with additional coverage.
  • Additional living expenses: If you’re temporarily displaced by an insurable event, this protection covers your temporary housing costs. For example, if damage to your home forces you to spend a week at a hotel, additional living expenses protection will cover the cost of the room and food, up to a certain amount.

Liability coverage

  • Personal liability: This coverage provides protection against liability in the event someone is accidentally injured on your property.
  • Voluntary medical payments: If you unintentionally injure someone, or someone accidentally injures themselves on your property, this coverage will pay for the medical expenses for up to one year from the date of the accident.
  • Voluntary property damage: This coverage is for unintentional direct loss or damage you cause to someone’s property. It also covers unintentional loss or damage to someone else’s property by a minor (12 years or under) in your care.

Add-ons to home insurance coverage in Ontario

Beyond the standard components of an Ontario home insurance policy, there are additional coverages you can purchase to further protect your home and the contents within.

These are some of the most common home insurance add-ons, also known as riders, that you can add to your home insurance policy:

  • Overland water: Although not every carrier offers this add-on, if your insurer does, it covers property damage from overflowing water from nearby rivers, streams, lakes and thawing snow.
  • Sewer back-up: Protects your home when a main sewer backs up and causes damage.
  • Earthquake: Covers losses or damage caused by an earthquake. This add-on is especially useful if your home is located in an area that is vulnerable to earthquakes.
  • Mass evacuation: If an event, like a flood or wild fire, triggers a government issued evacuation order, this add-on pays for some of the expenses you incur while being away from your home.
  • Identity theft: Covers the cost of replacing important documents, such as your passport.
  • Lock replacement: If you need to replace the locks on your house, this add-on provides coverage.


What is not included in a typical home insurance policy?

Even if you have the most coverage money can buy, having opted for every available endorsement, there are some perils against which no policy will protect you. In the insurance world, these are referred to as 'exclusions'.

Common exclusions include:

  • Absence from the home: Damage that takes place while you’re away from the home for an extended period of time.
  • Alterations: A homeowner will only be protected against damage to a property that occurs during an alteration to it if they have received written permission from the insurance provider to undertake the alteration. However, common repairs such as painting or fixing a broken railing are not subject to this exclusion.
  • Bylaw enforcement: You are not likely to be covered for costs stemming from the application or enforcement of a bylaw.
  • Damage from renters: Most insurance providers require specific coverage for landlords. A standard home insurance policy is unlikely to protect you if a renter damages the property.
  • Earthquake: Most policies exclude protection against earthquakes, though you can add coverage in the form of an endorsement.
  • Existing damage: You’re unlikely to be covered for damage that began before you held the policy.
  • Flooding: Most policies exclude flood protection, though coverage can be purchased as an endorsement.
  • Volatile substance: If you have more than one gallon of a volatile substance on your property and a fire or explosion takes place, you may be denied coverage. This is likely to include gasoline.


There are also some perils for which no coverage is available. They’re referred to as ‘uninsured perils.’ For example, if your home is built on a known flood plain, no insurance protection may be available.

How RATESDOTCA gets you the best Ontario home insurance quotes

RATESDOTCA works with home insurance companies and brokers in Ontario to provide you with a broad selection of quotes. We quickly collect your information and use it to generate the best offers from each of our partners. Our service is fast, easy and free to use.

By comparing Ontario home insurance quotes from several insurance providers in a single place, you can instantly assess the market and find the best policy to protect your property.

What determines the cost of home insurance in Ontario?

Ontario home insurance companies use a variety of factors to calculate your level of risk. The higher the risk, the more they’ll charge for coverage.

This list outlines the variables that have the greatest impact on the cost of your home insurance policy:

Flood risk

Insurance rates in Ontario are higher for homes located in areas known to flood or identified as flood plains. If you live close to a waterway, you can also expect to pay more for coverage. Even if that river or lake has not overflowed recently, record claim amounts for homes damaged by severe weather have made insurance providers increasingly cautious. To be fully protected against flood risk, you may need to add different types of flood protection to your home insurance policy. While some insurance providers combine flood coverage into a water protection policy, others distinguish between overland flood protection and sewer back-up protection. Make sure you clearly understand what flood coverage has been added to your policy.

Disrepair

While most home insurance policies will protect against unexpected damage, if it was predictable, your claim may be denied. For example, if someone is injured after falling through a damaged banister, your home insurance provider has grounds for denying coverage. Make sure you attend in a timely manner to any aspects of your home that need repair so you can be confident of being covered, should the need arise.

Replacement cost

The replacement cost of your home is a primary determiner of the cost of your home insurance. The more expensive your house is to fix or rebuild, the higher your premiums will be.

Property location

The location of your home is factored into your premiums. If you live in an area with a high rate of break-ins, you’ll likely pay more because of the higher risk of theft. If you live next to a lake, you’ll pay more because of the risk of flooding.

Basement

Because basements are especially prone to water damage of both internal or external sources, owning a house with a basement means you’ll likely pay more for home insurance.

Electric wiring

Houses built in the 1950s and earlier usually use a 60-amp service, which is more likely to cause a fire than the wiring used in newer homes. This increased level of risk may cause your premiums to go up.

House age

Beyond wiring, older homes are more likely to be at risk of plumbing and heating faults, which can lead to water damage or fire

High-risk household appliances

Wood-burning stoves and oil-based heaters can reduce energy costs, but they also increase the risk of a fire.

Roof

If you need to replace your roof, it can cost you up to $10,000, depending on the size and type of roof you’re installing. The materials used to build your roof therefore affect your insurance rates.

Pets

If you have a pet, you’ll need to disclose it to your insurance company. Some pets are considered a liability risk. Certain dog breeds, such as pit bulls and rottweilers, may even cause some insurance providers to decline your application for coverage.

Smoking

Home insurance providers may offer a discount to homeowners who don’t smoke because they deem the home less likely to be damaged by fire from an unattended cigarette.

What a standard home insurance policy may not cover in Ontario

Standard home insurance policies won’t cover your mortgage payments or property taxes. They may also exclude coverage of certain contents, like fine art, or protection for secondary structures on your property. Before selecting an Ontario home insurance policy, it’s important to understand what is and what is not protected under your plan.

Ontario home insurance premiums trends

Home insurance premiums in Ontario have been steadily increasing in recent years for a variety of reasons.

To begin with, it’s easier for insurance providers to increase home insurance rates than to increase auto insurance rates. While the latter requires regulatory approval, the former can be changed at the discretion of the company. The low interest rates environment of the last several years has resulted in lower investment returns for some insurance providers. To increase their revenue, many may have increased home insurance premiums.

Here’s a look at year-over-year home insurance increases in Ontario:

Ontario home insurance price trends 2011-2021
Year Avg Ontario home insurance premium (CAD) Year-over-year % increase
2022 $1,487 16
2021 $1,282 10
2020 $1,164 1.2
2019 $1,150 20.2
2018 $957 4.2
2017 $918 0
2016 $918 16
2015 $791 8.4
2014 $730 (4.3)
2013 $763 2.3
2012 $746 (4.6)
2011 $782

An increase of about 16% between the 2021 average provincial premium and that of 2022 also has to do with increasing incidents of severe weather, supply chain issues and a labour shortage.

More and more homes in Ontario are being damaged by severe weather. This has resulted in a higher volume of record claims.

Supply chain challenges and a labour shortage have also driven up replacement costs significantly.

For example, if a home covered by a comprehensive policy is damaged by a covered peril, the insurance provider will have to pay more to rebuild the structure because the cost of materials has increased and the cost of labour to complete the build has also gone up. These two factors are also likely to result in the provider having to cover the policyholder’s expenses for longer since they’ll be put up in a hotel for the duration of the delayed rebuild.

Average home insurance quotes in Ontario

According to data from RATESDOTCA’s 2022 Home Insuramap, the average annual cost of insurance for homes in Ontario was $1,487.

Most expensive cities
City Premium
LaSalle $2,411
Windsor $2,139.47
Hearst $2,046
Foleyet $2,046
South Porcupine $2,046
Keewatin $2,033
Fort Frances $2,023
Val Caron $2,005
Elliott Lake $2,005
Kapuskasin $2,005
Least expensive cities
City Premium
Ajax $1,068
Stratford $1,071.50
Cambridge $1,081.40
Whitby $1,093.33
Holland Landing $1,094
Guelph $1,098.22
Waterloo $1,102
Kitchener $1,102.60
Concord $1,104
Stoufville $1,104

Premiums for homes located near water were significantly higher. For example, the average annual home insurance rate in LaSalle, Ontario, near Windsor, was $2,411 in Ontario. The Windsor region is very flat and prone to flooding. The LaSalle neighbourhood is on the shores of The Detroit River.

As more and more Ontarians are affected by climate change, insurance providers are increasing their rates to ensure sufficient funds are available to cover more and more record claims being made by homeowners across the country.

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Frequently asked questions about Ontario home insurance

Who has the best home insurance rates in Ontario?

While there's no definitive 'best' home insurance provider in Ontario, comparing quotes is definitely the best way to find a home insurance policy that fits your needs. To find the best quote, compare offers from as many Ontario home insurance providers as possible with RATESDOTCA. We work with some of the most trusted home insurance providers in the province to find you the cheapest Ontario home insurance policy on the market.

How do I save on home insurance in Ontario?

You can save on home insurance in the following ways:

  • Bundle home and auto insurance: Bundling policies with one company will give you a discount.
  • Buy a newly-built house: Buying a house that has up-to-date safety measures will help you save.
  • Replace outdated wiring and plumbing: If you live in an older house, consider updating your wiring and plumbing to prevent accidents.
  • Update your roof: Use impact-resistance materials to protect against damage and leaking.
  • Maintain a good credit record: By letting the insurance company run a credit check, you could qualify for lower rates.
  • Increase your deductible: As with all insurance policies, if you increase your deductible (the amount you pay in the event of a claim), your premium will drop.
  • Install gas and water sensors: Detection of gas and water leaks will not only help protect your home, it may also help you get a lower rate on home insurance.
  • Shop around for the best rates and ask for discounts: Compare offers from as many Ontario home insurance providers as possible. The more quotes you get, the more likely you’ll find the cheapest policy in Ontario.

Is fire insurance mandatory in Ontario?

No, fire insurance is not mandatory in Ontario nor is home insurance. However, most lenders will only mortgage properties that are protected by home insurance. Even the most basic, least expensive home insurance policy is likely to protect against accidental fire damage. This includes incidents such as lightning strikes, gas leaks, faulty electrical wiring, kitchen fires, candles, cigarettes, or even faulty fireworks. However, there may also be some exclusions. This means that the same policy will not cover you against damage caused by fire following a war, riot or nuclear explosion.

What are the most common risks homeowners face in Ontario?

Homes in Ontario are vulnerable to the increasing volume of severe weather events taking place across Canada. Adding to the risks is how many neighbourhoods are developed near lakes and rivers. If your home is located near a waterway, we strongly encourage you to add flood protection to your home insurance policy to make sure that you’re protected in the event of an overland flood or sewer back-up.

Homeowners in Ontario, particularly in the Ottawa area, may also consider adding earthquake protection to their policies. While earthquakes are not common, they have taken place. In 2010, an earthquake in the Ottawa area, which measured 5.0 on the Richter Scale, caused significant property damage including gas main breaks, a bridge collapse and significant property damage to homes near its epicenter.

Will I be charged if I switch home insurance providers?

It depends. Most house insurance policies require a 12-month commitment. Once this period expires you may switch to a different provider without penalty. If you decide to cancel an existing policy before it expires, you may be required to pay an early cancellation fee.

If I use my home as an Airbnb, does my home insurance cover it?

Your home insurance policy may offer limited coverage for guests, but you need to confirm with your insurance provider before using your home as a rental property. In most cases, additional coverage will be required. If don’t disclose that you’re renting all or part of your house to guests, your insurance provider may void your policy.

*Shoppers in Ontario who obtained a quote on RATESDOTCA from January to December 2021 saved an average amount of $473. The average savings amount represents the difference between the shoppers’ average lowest quoted premium and the average of the second and third lowest quoted premiums generated by RATESDOTCA. Excludes tenant and condo insurance.

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