The Cost of Extreme Weather on Insurance
A recent report from **RATESDOTCA** highlights that severe weather events caused **over $7.8 billion** in insured damage across Canada in 2024—**more than double** the Insurance Bureau of Canada’s (IBC) 2023 figures.
Adding to the pressure, the IBC reports that **construction costs have risen 66% since 2019**, while **home replacement costs have increased by 24%**. As a result, homeowners renewing their policies in 2025 may face higher premiums, even if they haven’t made any claims.
Daniel Ivans, an insurance expert at RATESDOTCA, warns that the combination of **more frequent extreme weather events and rising repair costs** makes it crucial for homeowners to **review their insurance policies** and ensure they have **adequate coverage**.
“Often homeowners are surprised by how expensive repairs have become,” Ivans says. “Labour shortages can also lead to significantly delayed repair timelines, especially after widespread disasters like floods or wildfires.”
What Can Homeowners Do of Extreme Weather?
- **Review Your Policy**: Ensure your policy reflects current **replacement costs** for your home.
- **Understand Your Coverage**: Standard home insurance may not cover **overland flooding or sewer backup**—check your policy for exclusions.
- **Take Preventative Measures**: Installing a sump pump, backwater valve, or fire-resistant materials can help mitigate risks and may qualify you for discounts.
What About Auto Insurance of Extreme Weather?
Auto insurance is also affected by severe weather. Flooded vehicles, fallen trees, and hail damage are common claims after storms. Comprehensive auto coverage helps protect against these risks.
Unlike home insurance, **auto insurers must file for rate increase approvals**, meaning **home insurance premiums may rise unpredictably** as insurers adjust pricing based on their own claims experience.
Be Prepared with AiA Insurance Brokers
At **AiA Insurance Brokers**, we help Ontario homeowners and drivers navigate the changing insurance landscape. Whether you need **home or auto coverage**, we can find the best options tailored to your needs.
Contact us today for a policy review and personalized recommendations.
