Canadian condo and home insurance prices on the rise – report

As tough as the current financial situation is, a new report from LowestRates.ca warns that insurance rates for home and condominiums are expected to increase.

The report highlighted a couple of notable trends that have contributed to the increase in insurance prices – namely, the impact of climate change and the increase of condo insurance claims.

Discover the leading condo insurance providers in Canada and the standard inclusions they offer in their policies.

Key findings of the report include:

• Climate change is a key driver of home insurance prices: Premiums for residential properties increased over the past year, LowestRates.ca found, and the insurance comparison website has attributed this jump to rising real estate prices – as well as the increased frequency and severity of weather events.
• Condo insurance rates are soaring in Alberta and BC: LowestRates.ca noted that the average condo insurance price climbed by 16% between Q3 2019 and Q3 2020. The spike in deductibles of many condos is largely to blame for the increase, the report noted. Factors behind the deductible spike include the increased cost of building materials, higher frequency of damaging weather events and a lower number of insurance carriers competing for business in those provinces.
• COVID-19 has not impacted home insurance rates – yet: While there have been concerns that working from home would lead to home insurance costs rising, LowestRates.ca data suggests that has not been the case. But the increased usage of the home over time might ultimately result in more insured losses, and thus drive up claims and costs.

"The industry expects prices are only going to get more expensive as insurance companies deal with rising building costs, increased weather events and more claims," said LowestRates.ca CEO Justin Thouin. "However, not all insurers will raise their rates at the same level. While one company may be raising rates by 10%, another may raise rates only 1%.”

Thouin also recommended that homeowners and condo owners should try to shop around for better rates in a rising rate environment.