Canadian homeowners are facing an increase in a myriad of natural disasters, including wildfires, floods, and other extreme weather events. Floods, like the one in Baie-Saint-Paul, near Quebec City, drove up insurance claims from extreme weather in 2023 to the fourth-highest total on record, according to a new report by the Insurance Bureau of Canada. Some Canadian homeowners are finding that they can’t get home insurance coverage. As a result, we have some of the factors that are increasing home insurance rates beyond homeowner’s reach, leading some Canadians to struggle to find home insurance.

Home insurance in 2024

Due to economic instability and geopolitical conflict, Canadian P&C insurers predict lingering hard-market conditions akin to 2023. Home insurance coverages and costs garnered as much attention as mortgage rates in 2023. According to the experts, three trends homeowners are likely to see are:

  1. Insurance predictions are based on various market factors, such as high claims costs, high repair and replacement costs, climate change, and natural disaster incidents.
  2. Overland flooding – Many homeowners are finding it difficult to obtain proper coverage against flooding. A National Flood Program is in development but is not expected to launch until Spring 2025.
  3. Mortgage rates – Many Canadians expect to renew their mortgages in 2024 at higher interest rates. This means homeowners will be forced to cut back on expenses elsewhere. Home insurance is not mandatory, except in cases where mortgages are a requirement, and premiums are not regulated.

Weather events

Floods, like those in Quebec in 2023, are putting a great strain on P&C insurance. In a report published by the Insurance Bureau of Canada (IBC), insured losses from extreme weather events exceeded $3 billion in Canada for the second straight year. The report underscores concerns about the growing economic cost of weather-related disasters made more frequent and severe by climate change — and the rising cost of insurance coverage for homeowners. In some cases, homeowners are struggling to get coverage at all. A mix of storms, flooding, and wildfires, as well as hurricanes and hail storms across the country, contributed to the fourth priciest year for insured losses. “It’s important to note these losses are coming from not any one single type of event,” says Craig Stewart, IBC’s VP of Climate Change and Federal Issues.

Unaffordable home insurance

As a whole, home and mortgage insurance have climbed an average of 33 percent over five years from April 1, 2018, to the same month in 2023, according to Statistics Canada. The IBC report, in addition to others, has put pressure on the federal government, leading to the creation of the National Flood Program. This is especially important for those Canadians who live in a flood- or wildfire-prone area. During the Quebec floods last year, well-known artist Humberto Pinochet watched helplessly as floodwater rushed into his artist’s studio and home in Baie-Saint-Paul. The artist whose paintings document this region, says he was unable to get flood insurance because his home was situated on a flood plain, in a low-lying area between two rivers. According to Stewart, the high likelihood of flooding in some areas has made insurance companies reluctant to offer coverage.

Protecting your home from natural disasters

Ontario residents everywhere must prepare for all sorts of weather within the same season. Treacherous snowfalls are expected in winter, as well as unpredictable mild winter temperatures that bring about abundant rainfall. Though we don’t get as much rain as other provinces, Ontario has grappled with flooding and even earlier spring thaws.

Once summer arrives, however, many Canadians need to contend with scorching hot temperatures and drought that lead to wildfires. Wildfire season typically happens annually from May to October each year. Canada is home to about 9% of the world’s forests. According to The Canadian Interagency Forest Fire Centre, the end of June 2023 saw 428 fires burning consecutively across the country, resulting in some 43,000 square kilometres burned in the first half of the year. As a homeowner, you may be wondering what can be done to safeguard your home and loved ones. Canceling your home insurance shouldn’t feel like your only option to stay afloat. However, with the increases in climate change, natural disasters, and rising premiums, what can be done?

Listed below are some of isure’s helpful strategies to protect your home against extreme weather. It shouldn’t be that you’re struggling to find home insurance, especially in these dire times. In addition, we’ve got a complete list of available home insurance discounts to help you manage the cost of coverage to ensure you and your belongings have coverage.

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