How much are catastrophes boosting home insurance premiums?

Annual average insurable losses (AAIL) in the last decade have increased a whopping 379% in Canada compared to the prior 30-year average, according to a new study from insurtech MyChoice Financial.

What’s more, provinces like Alberta and Saskatchewan experienced massive increases in AAIL of 495% and 302%, respectively. Meanwhile Ontario had an 89% rise in the last decade, MyChoice reports.

On the flip side, New Brunswick and Nova Scotia saw decreases of 87% and 24%, respectively.

For the study, the insurtech analyzed how insurable losses from natural disasters changed over the last 40 years across Canada. Using data from the Canadian Disaster Database, the team compared the 10-year average of disaster-related annual insurable losses against the prior 30-year average, adjusted for inflation.

The team also examined Shelter Consumer Price Index data from the past 10 years to determine home insurance inflation across Canada, and compared it to current rates from the MyChoice quote database.

“Some provinces didn’t have an increase in climate-related damages but still experienced home insurance inflation, absorbing the overall risk of increased climate-related damages across the country,” MyChoice says in a press release Wednesday.

Average home insurance premiums jumped 76% across Canada in the last decade, from an average of $539 in 2014 to $948 in 2024.

Saskatchewan and Alberta saw the highest increases at 106% for Saskatchewan (from an average of $491 in 2014 to $1,012 this year) and 90% for Alberta ($696 in 2014 to $1,324 in 2024).

Quebec and Prince Edward Island saw the lowest increase in average annual home insurance premiums over the past decade, although the increases were still significant — 46.5% in Quebec and 57.2% in PEI.

MyChoice estimates climate-related disasters have cost the average Canadian about $409 a year in increased home insurance premiums over the last 10 years.

Feature image by iStock.com/zepp1969