Get Cheap Ontario Home Insurance

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 be protected financially.

If neither benefit persuades you, consider the practical reality of home ownership. Homes in Canada are increasingly impacted by damage from severe weather events linked to climate change. The Insurance Bureau of Canada (IBC) reports that in 2023, insured damage for severe weather in the country hit $3.1 billion. In addition to the record-breaking wave of wildfires that year, Ontario also had to contend with severe summer storms, which cost the province $340 million in insured damage. Furthermore, a spring ice storm that hit both Ontario and Quebec earlier that year cost the two provinces $330 million in insured damage.

When looking at the catastrophic losses from 1983 to 2022, as recorded in the 2023 IBC Fact Book, a clear pattern can be spotted – that insurance losses have risen dramatically over the last three decades, both in Ontario and Canada at large.

For instance, from 1983 to 2000, average catastrophic losses in Canada amounted to $440 million per year (loss and adjusted expenses in 2022 dollars). Between 2011 and 2020, those losses rose to the average of $2.3 billion. In 2020 alone, Ontario had to deal with flooding, windstorms and winter storms on two occasions. First, in January, which cost Greater Toronto, Kitchener, Innisfil, New Hamburg and Montérégie, Quebec, $110 million in damages. And later, in November, which cost southern and central Ontario, including Greater Toronto and Hamilton Area, Niagara region, Lake Erie shoreline, Muskoka region and Lake Ontario shoreline, $108 million in damages. In 2022, Ottawa, Greater Toronto, Kitchener-Waterloo as well as Outaouais, Lanaudiere and Laurentides in Quebec lost $1.3 billion in damages due windstorms and other catastrophic events.

This means that the protection afforded to you by home insurance won’t come cheap. In Q4 2023, for instance, all provinces experienced an increase in premium rate change year over year, with British Columbia seeing the highest rate increase of all – at 11.1%. Alberta, Ontario, Quebec and the Atlantic Provinces fared a little better, with rate changes of 0.7%, 8.3%, 2.5% and 9.1%, respectively. Even so, Ontario sits on the higher end of this spectrum.

So, what can you do as a homeowner? Your best bet is to be more discerning. When shopping for insurance, avoid buying the coverage you don't need. Here, we outline some of the important details you should 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.
  
• Personal valuables: This add-on lets you increase the coverage amount to account for high-value items such as fine art, collectibles and jewelry (in case your regular coverage is not enough).
  
• Home sharing: If you’re looking to rent out your property, this will provide you with the additional property and liability coverage you need to stay protected.
  
• Personal umbrella: If you’re worried that your standard liability coverage isn’t enough (e.g. if your lawsuit costs you more than expected), this add-on can make up the difference.
  

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.