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Nearly 40% of Canadians live in Ontario, and Ontario is home to some of the country’s highest property prices; together these factors combine to form one of the largest and most competitive home insurance markets in North America.
With so many people looking to protect such valuable real estate, it’s no surprise that Ontarians have over 100 companies to choose from when picking their insurance, and this volume can feel a little overwhelming. So to help you make the right decision when protecting your most valuable asset, we’ve broken down everything you need to know about the Ontario insurance market. Let’s start with some of the most tried and trusted insurance providers available, shown in the table below.
Unlike auto insurance, home insurance is not legally mandatory in Ontario. However, you may still be required to have some form of home insurance, especially if you have a mortgage. There is usually a clause in mortgage agreements that states the mortgage holder must have enough property insurance to cover rebuild costs, in the event of total loss of the home, and most show proof of this insurance when applying for the mortgage.
There are a couple of different types of property insurance available in Ontario; although all three are colloquially known as “home insurance”, they are in fact distinct. They are:
A standard homeowner’s insurance policy will cover the physical buildings that constitute the home (including detached structures), your personal belongings, and personal liability in the event that someone is injured on your property. These aspects of your home are covered against common events, known as “insured perils”; however some (potentially common) issues are not covered by standard homeowner’s insurance policies.
Coverage for these unlikely but potentially expensive events (like flooding) is sometimes available as an add-on, or as part of more comprehensive policies. But depending on where you live in Ontario, specific coverages may be unavailable. For example, flooding insurance is not going to be an option if you live on a floodplain.
Condo insurance is like homeowner’s insurance, but it only covers the named unit within the condo building - not the larger building’s structure. A condo building will usually have its own insurance policy (known as condo building insurance) to cover the common areas and main structure of the property. Many condo boards have specific requirements for occupant’s condo insurance, and you should check these before purchasing a policy. It’s also wise to ask to see the condo building insurance policy, so you know how far this goes and any exclusions you need to be aware of. Over 23% of Canada’s condo population live in Toronto alone, so this is a popular form of insurance in the province.
Tenant’s insurance is a little different in that it does not cover the property in question, but it does cover your personal belongings within the property, as well as personal liability. If you don’t have a lot of valuable possessions, this may feel like overkill, but the liability portion matters; imagine if you had a cooking fire in your kitchen, and it damaged the property itself. Without insurance, you’d be liable for the repairs. This level of protection is valuable and costs much less than homeowner’s insurance.
The average cost of homeowner’s and condo insurance in Ontario is just over $104 a month, but the range around this average is broad. Some people pay as little as $60 a month, and some as much as $170 a month. Those in Ottawa and Toronto pay the most on average because of higher property prices and higher risks in these urban areas. The average cost of tenant’s insurance in Ontario is much lower, at just $21 a month.
Insurance costs in Ontario have been on the rise for the past few years, for multiple reasons, including:
All of these reasons drive costs up, so it’s more important than ever to find ways to save.
Shopping around is still the number one way to save on your home insurance, but there are other methods, including:
You can technically use standard homeowner’s insurance if you choose to rent your property out, but you need to be clear with your policy provider about who will be living in the home. Because homeowner’s coverage does not cover you for loss of income from the home, if something happens to it that prevents you from renting it out, many landlords choose rental property insurance instead.
Yes, absolutely, and protecting your vacation home is important. You can often add vacation property or cottage coverage to your main homeowner’s insurance policy to save money.
No, unless you run a home business, in which case you will need business insurance coverage as well as your standard homeowner’s coverage. In this case, only the supplemental business insurance will be tax deductible.
Technically, yes, any individual insurance company can deny you coverage, but this is very rare. If you are denied, you can ask why and potentially solve the problem or find another provider.
Performing renovations on your home will not affect your insurance coverage, but you must inform your insurer of any changes you make to the home. Improvements may decrease or increase your insurance rates, but in the event of a claim the insurer has room to deny you if you’ve failed to give them accurate and up-to-date information on the home’s condition.
Those running an Ontario home-based business need to have a separate insurance policy to cover their business activities, as homeowner’s insurance does not cover business-related claims. Business insurance or home-based business supplements to your existing policy are both possible.
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