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What Factors Impact Home Insurance Costs in Ontario?

There are many different factors that insurers use to determine the cost of home insurance premiums in Ontario. They include things like where your home is, how much it would cost to rebuild your home, how close fire hydrants and fire stations are, and how old your home is.


One of the biggest factors in determining your home insurance rate in Ontario is the city you live in. The city and neighborhood where your home is located impact your home insurance rates because your insurer tracks data about the type, cost, and number of claims in your neighborhood. They use past claims to understand your neighborhood and determine the likelihood of future claims.

Replacement cost

Rebuild value, or replacement cost, is an important factor in determining your home insurance premiums. It is not the same as resale value because it includes the cost of materials and labour for rebuilding your home but not the value of the property your home is on. Replacement cost is how much it would cost to rebuild your home if it was destroyed. The size of your home and the materials used to build it factor into its replacement cost. The higher the replacement cost of your home the more you will pay for home insurance.

Proximity to fire hydrants

Your insurer will need to know how close the nearest fire hydrant or fire station is because the sooner a fire can be put out the less it will cost to repair your home. This is usually not a concern in the city but rural areas are further from fire stations and this will increase your rates.

Electrical wiring

Insurers consider what type of electrical wiring your house has and how electricity comes into your home. Aluminum or knob-and-tube wiring increases the risk of fire and insurers can ask you to guarantee that your home does not have this type of wiring. They may give you time to remove it or they can inspect it for safety. Breakers are safer than fuses and you should have at least 100-amp service to avoid overloading and fire.

The age of the roof

An old roof will increase your premiums and it should not be more than 20 years old. Some home insurance policies only cover the depreciated value of a roof if it is nearing the end of its life.

Wood stoves

Wood-burning stoves are a fire and carbon monoxide hazard if they are not maintained or installed properly. Insurers may need to inspect them and having one can increase your home insurance rate.

What kind of plumbing your home has

Homes with copper or plastic piping get better insurance rates because galvanized or lead piping means old plumbing that has a higher risk of cracks and leaks.

Your claims history

Your insurance claims history can affect your premiums because insurers use past claims as a way to predict the likelihood of future claims.

Other uses of your home

If you rent a portion of your home, have a home-based business, or make significant changes to your home’s structure or its use you need to inform your insurer so they can adjust your home insurance policy.

Security systems

Monitored security systems and fire alarms mean that help can get to your house faster and can decrease your insurance rates.

Improvements or additions

If you have a pool or additional structures your rate will be higher because of the additional risk or extra property to insure.

How much coverage you choose

If you decide to purchase basic coverage your home insurance rate will be lower than if more coverage is included in your policy.

How much does home insurance cost in Ontario?

The average cost of home insurance in Ontario is about $1250 a year. Tenants pay around $210 a year and condo owners pay about $345 per year. Home insurance is more expensive than renters or condo insurance because it covers the building, not just your personal property and interior of your unit.