Home insurance premiums surge
Home insurance costs are rising sharply across Canada, with some premiums climbing up to 20% year-over-year and outpacing wage growth reported. Analysts warn those increases act like a hidden mortgage affordability shock—squeezing household budgets and raising arrears risk.
National home insurance premiums rose 5.28% in 2025, with Alberta posting the largest provincial jump at 9.07%. mychoice.ca In certain wildfire‑exposed markets premiums spiked far higher: Kamloops’ average premium nearly doubled between 2023 and 2025, and a single water‑damage claim can raise an Ontario policy by roughly 19%. wahi.com Residential building construction costs — a key input for replacement estimates — have climbed about 66% since 2019, and insured losses reached roughly $8.5 billion in 2024, driving insurers’ rate resets. ibc.ca Bank of Canada staff estimate five‑year fixed borrowers renewing in 2025–26 could see payment increases of about 15–20% at renewal, while MyChoice/Wahi calculate home insurance can equal ~19% of a mortgage payment in Medicine Hat versus ~2% nationally, creating a stacked affordability shock. bankofcanada.ca Market responses include insurer withdrawals and tighter underwriting — CUMIS said it will exit Alberta effective Jan. 1, 2026 — and industry reports flag reduced reinsurance capacity alongside roughly an 8% global reinsurance rate‑on‑line in 2025; Ottawa has been working with insurers on a low‑cost national flood program since 2024. discoverairdrie.com
