How does extreme weather affect your home insurance premium?

The words “extreme weather” can take on an entirely different meaning depending on where in Canada you live. But whether you picture torn-up shingles from intense winds or a flooded basement after a heavy downpour, the reality is that extreme weather is on the rise across the country. From torrential rain to massive snowstorms and wildfires, it's more important than ever to ensure your home is properly protected.

While it’s easy to see how this increase in catastrophic weather events comes with an increased risk of property damage, it may be less obvious how such occurrences can impact your home insurance premium. In partnership with TD Insurance, we’ve gathered a few considerations to help you understand how extreme weather factors into home insurance costs, so you can feel more confident and better informed about your coverage options.

How are home insurance premiums calculated?

All homeowners should know the basics about how home insurance is calculated in Canada, which is one reason why TD Insurance puts that information up front. Though the exact factors and considerations can differ from provider to provider, insurance premiums are generally based on the likelihood that you will make a claim and how much that claim may cost. Because of this, some important considerations in this equation are your home’s location, age, and property type.

It’s also why an increase in severe weather events in your area can result in an accompanying increase in coverage costs; as more severe weather-related claims are submitted, this can in turn impact home insurance premiums. For example, a homeowner in a flood-prone neighbourhood may pay a higher cost for water damage coverage compared to one that owns a home in a drier climate.

In addition to the rise in extreme weather, the increasing cost of building materials and labour has also made some property damages more costly to fix, causing the average home insurance premium in Canada to increase.

How does extreme weather increase the need for buying home insurance?

Unfortunately, extreme weather in Canada is increasing in frequency, severity and cost. It is estimated that bad weather caused $3.1 billion in insured damage across Canada in 2023 alone. Additionally, the Insurance Bureau of Canada rated five of the past six years among the worst ever for severe weather-related losses. Flooding and extreme heat leading to wildfires factored heavily into the damage, impacting governments, businesses and everyday Canadians.

As the risk of severe weather events continues to increase, so does the risk of damage to your property. As such, it is important to prepare accordingly by ensuring you have the right insurance coverage according to your needs and situation.

Your coverage matters

The right coverage may help to ensure your property is covered for damages brought on by extreme weather caused, in part, by climate change. In fact, you may be surprised to learn that some extreme weather damage, such as wind damage to roofs or the forest fires we’ve seen on Canada’s coasts, may already be covered in your homeowner's policy.

However, many insurance policies that cover basic water-related damage – the most common type of insurance claim – may not include water damage from flooding. For these situations, you may want to consider adding additional coverage to your standard policy, such as Extended Water Damage coverage offered by TD Insurance, especially if you live in an area prone to flooding.

Reach out to a TD Insurance Advisor to discuss your home policy needs or get a home insurance quote online quickly and easily.

What can I do to protect my home and lower my insurance costs?

Aside from ensuring your home is properly covered by your insurance policy, it’s important to remain vigilant when it comes to extreme weather. To protect your home from potential weather damages, consider preparations like: weather sealing your windows and doors, installing storm shutters and steel doors, ensuring your roof is in working order, and keeping your yard free of debris or loose objects.

TD Insurance also helps make this easy for customers by offering the option to receive Severe Weather and Safety Alerts through the TD Insurance app. You’ll receive timely, localized alerts for impending severe weather events direct to your phone, along with helpful tips on how you can prepare for them.

As for ways to lower your costs in the face of catastrophic weather, installing a smart home monitoring system isn’t just beneficial to help deter burglary and vandalism, it can also alert you to water leaks, carbon monoxide or smoke in your home—and insurers may offer a discount as a result. And while it’s true that newer homes typically pay lower premiums compared to older ones, making home upgrades that can help mitigate weather-related damage – such as installing a new sump pump or replacing an aging roof – can also help lower your premiums by decreasing the effect of your home’s overall age on your insurance policy.

What to do if your home has been affected by extreme weather

The most important thing is making sure everyone in your home is safe. If anyone involved is injured, please call 911. Once you confirm that everyone’s safe, you can start taking action on your home insurance claim. If your home has been affected, it helps to know how to make a claim, as well as how home insurance works for addressing damage and repairs.

Dealing with severe weather and unexpected damage to your home can be stressful, but TD Insurance helps make the claims and repair process simple, whether you want to start a claim straight from your phone via the TD Insurance mobile app, review your policy coverage online, or speak to a TD Insurance Advisor to go over next steps.

Looking for insurance advice? Explore insurance tips and find the right coverage for your needs at TD Insurance.

TD Insurance residential and personal lines automobile insurance policies are underwritten by Security National Insurance Company, Primmum Insurance Company, TD General Insurance Company, and TD Home and Auto Insurance Company, and are distributed by TD Direct Insurance Agency Inc. and Meloche Monnex Insurance and Financial Services.

Due to provincial legislation, TD Insurance does not offer personal lines automobile insurance products in British Columbia, Manitoba, or Saskatchewan.