Extreme weather events behind prediction home insurance premiums will jump in 2025
Posted January 13, 2025 6:44 am.
Last Updated January 13, 2025 6:48 am.
Floods, wildfires, and other extreme weather events are causing record-breaking insurance losses across Canada and there are predictions that will keep pushing up premiums for homeowners.
A report from RATESDOTCA points to over $7.8 billion in insured damage caused by severe weather events in 2024 — more than double the Insurance Bureau of Canada’s (IBC) 2023 figures.
CLICK HERE TO LISTEN TO 1130 NEWSRADIO VANCOUVER LIVE!The IBC says the industry is also grappling with construction costs that have risen 66 per cent since 2019, while home replacement costs have risen 24 per cent during the same time period.
RATESDOTCA predicts that will likely lead to higher home insurance premiums this year when people renew their policies, even if they haven’t made any claims.
“Given the severity and increasing frequency of extreme weather patterns and the increasing cost of replacement, it’s crucial for homeowners to ensure their policies provide the amount of coverage they need if the worst happens,” said Daniel Ivans, a broker and insurance expert for the online platform.
“Often homeowners are surprised by how expensive repairs have become, and labour shortages mean repair timelines can be significantly extended, especially in the case of a widespread disaster such as a flood or wildfire, where many claims are being processed at once.”
The report offers some advice, suggesting it pays top shop around when your policy is up for renewal because not all insurers will offer the same premium price for the same home.
It also warns that home insurers are not required to file for rate increase approvals from a governing body, unlike auto insurers.
“Because home insurance does not have this rate increase approval requirement, insurers can raise or lower premiums according to an individual insurer’s needs at any time.”
You can watch CityNews 24/7 live or listen live to 1130 NewsRadio Vancouver to keep up to date with this story. You can also subscribe to breaking news alerts sent directly to your inbox.
