Canadian homeowners can expect higher home insurance premiums in 2025, with rates rising by an average of 5.28%, according to a new report from My Choice Financial. This jump—well above the inflation rate—follows a 7.66% increase in 2024 and is largely driven by climate change and extreme weather.
The Insurance Bureau of Canada (IBC) reported a record $8.5 billion in insured losses for 2024—three times higher than the previous year and 12 times the annual average between 2001 and 2010. From hurricanes in Atlantic Canada to hailstorms in Alberta and widespread wildfires, no region is untouched. Flooding remains Canada’s most expensive natural disaster, yet 1.5 million homes are considered too high-risk to qualify for flood insurance.
Although the federal government has pledged to create a national flood insurance program, delays in implementation have left many vulnerable. Experts stress that the private insurance market alone can’t bear the growing financial risks. Calls for greater government involvement and investment in climate adaptation and disaster mitigation are growing louder.
Finance expert Mary Kelly urges Canadians to protect their homes with climate-resilient upgrades and to stay informed. As the climate crisis deepens, proactive planning and strong public-private partnerships will be key to keeping insurance accessible and affordable.
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