Most Common Question: Is Home Insurance Going Up?
This time of year one of the most common emails from clients is whether home insurance prices are still going up? Price of home insurance is on the minds of many Canadians because the premiums keep going up year over year even for those of us without any claims. I myself have been fortunate enough to never have made a home insurance claim. So why are premiums always going up and what might we expect in 2026?
2026 Forecast at a Glance
Industry experts and current data suggest that home insurance premiums will continue to rise for most homeowners in Ontario. In Toronto, experts predict a premium hike of 4% to 6% in 2026, though some estimates for specific high-risk areas are higher. The Toronto luxury home segment is predicted to increase 8% to 12%.
Why are Rates Still Rising?
Several persistent factors are preventing Ontario home insurance rates from dropping.
- Climate & Severe Weather: 2024 was a record-breaking year for insured losses in Canada (approx. $8.5 billion). Insurers are raising rates to rebuild their “payout pools” after heavy losses from flash floods in the GTA and wildfires in Northern Ontario.
- Rebuilding Costs: Insurance is based on the cost to rebuild your home, not its market value. Even if house prices stay flat, the cost of skilled labour and materials has increased significantly, pushing up the “replacement value” on your policy. PRO TIP: Review the replacement value on your policy to ensure it is accurate. This can cause delays with claims.
- Global Reinsurance: Ontario insurance companies buy their own insurance (reinsurance) from global providers. Because of massive natural disasters worldwide, these global costs have risen, and those expenses are passed down to you.
Conclusion
Wish I had better news. On average Ontario and Toronto home insurance premiums are expected to increase in 2026. The rise is primarily due to enormous climate related claims in the recent years and increasing rebuilding costs due to labour and materials.
Clients often want to know what they can do to mitigate the rise in home insurance rates.
- Bundling: combining home and car insurance can often save you on average 15% to 25%.
- Raising your Deductible: Moving your deductible from $500 or $1000 to $2500 can significantly lower your monthly payment. Most experts argue that you should self insurance any loss under $2500.
- Shop Around: 2026 is expected to be a competitive year.Â
Always happy to answer questions. Feel free to reach out. vlosito@cibi.ca
