How to Lower Your Home Insurance Premium in Canada

Opening your annual home insurance renewal letter can be stressful. Like many other household expenses, home insurance has become more expensive for many Canadians. Higher construction and repair costs, severe weather and rising claims can all affect what you pay.

The good news is that you do not necessarily have to accept a higher premium without looking at your options. Insurance rates can vary between companies, and there may be discounts or changes you can make to your policy that could reduce the cost.

If you are looking for ways to save on home insurance, here are some practical things worth considering.

1. Shop Around for Better Home Insurance Rates

Sticking with the same insurance company for years is convenient, but it does not always mean you are getting the best rate. Insurance companies regularly review their pricing, so it is worth comparing your options when your policy comes up for renewal.

When comparing home insurance quotes, look at more than the final price.

Make sure you are comparing:

• Coverage limits
• Deductibles
• Exclusions
• Optional coverage
• Liability protection
• Water and sewer backup coverage

You can contact insurance companies directly or speak with an independent insurance broker who can compare policies from several providers.

A cheaper policy is not necessarily a better policy if it provides significantly less coverage.

2. Increase Your Home Insurance Deductible

Your home insurance deductible is the amount you agree to pay toward a covered claim before your insurance company pays the remaining eligible costs.

For example, if you have a $500 deductible and experience $3,000 in covered damage, you would pay the first $500 and the insurer would cover the remaining $2,500, subject to the terms of your policy.

Choosing a higher deductible, such as $1,000 or $2,500, can reduce your premium because you are taking on more of the financial risk.

Before increasing your deductible, make sure you could comfortably afford it if you needed to make a claim.

If paying a $2,500 deductible would put a serious strain on your finances, the savings may not be worth it.

3. Bundle Your Home and Auto Insurance

Many Canadian insurers offer a discount when you purchase more than one type of insurance from them.

Home and auto insurance are commonly bundled together, although some companies may offer discounts for other policies as well.

Bundling can be convenient and may save you money, but it is still worth comparing the total cost. A discount does not automatically mean the combined policy is the cheapest option.

Ask your insurance provider how much you would save by combining your policies and compare that price with separate quotes from other companies.

4. Ask About Every Available Discount

It is worth asking your insurer to review your policy for discounts. You may qualify for savings that were not available when you originally purchased your policy.

Depending on the insurance company, discounts may be available for things such as:

• Bundling home and auto insurance
• Having a monitored security system
• Having smoke and carbon monoxide detectors
• Installing certain water leak detection devices
• Having a newer roof
• Updating electrical, plumbing or heating systems
• Maintaining a claims-free history
• Being mortgage-free
• Meeting certain age or mature homeowner requirements

Discounts vary between insurers, so always ask which ones are available with your particular policy.

5. Improve Your Home Security

Improving your home’s security can help protect your property and may qualify you for an insurance discount.

Depending on the insurer, security improvements may include:

• Professionally monitored security systems
• Security cameras
• Smart doorbells
• Alarm systems
• Deadbolt locks
• Smoke and carbon monoxide detectors

Before spending money on a security system specifically to reduce your insurance premium, ask your insurer which systems qualify for a discount and how much you could save.

If you are considering upgrading your home security, our reviews of home security systems and smart cameras can help you compare your options.

6. Install a Water Leak Detection System

Water damage can be an expensive problem for homeowners. A small leak can quickly turn into significant damage if it goes unnoticed.

Water detection devices can alert you when moisture is detected, while some systems can automatically shut off the water supply.

Options include:

• Smart water sensors
• Automatic water shut-off valves
• Sump pump monitoring systems
• Backup sump pump batteries
• Basement flood alarms

Some insurance companies offer discounts for approved water protection devices, but this varies by provider.

Before purchasing a system, contact your insurance company and ask whether the equipment qualifies for a discount.

7. Maintain Your Roof

Your roof protects your home from rain, snow, wind and other weather conditions. An aging or poorly maintained roof can increase the risk of water damage and other problems.

Keep records of roof repairs and replacement work. If you replace your roof, provide your insurer with documentation showing the age and type of the new roof.

It is also a good idea to have your roof inspected periodically and deal with damaged or missing shingles before they become a larger problem.

A newer roof may help with your insurance costs, although any discount depends on the insurer and the condition of the property.

8. Update Old Electrical, Plumbing and Heating Systems

Older homes can sometimes have electrical, plumbing or heating systems that insurance companies consider higher risk.

Examples can include older wiring, outdated electrical panels, aging plumbing and older heating equipment.

If you upgrade these systems, keep your invoices, permits and contractor documentation. Your insurer may want proof that the work was completed by a qualified professional.

Not every renovation will lower your insurance premium. Some improvements, such as adding a swimming pool or expensive outbuilding, may actually increase the amount of coverage you need.

Always tell your insurer about significant renovations so your policy reflects the current condition and value of your home.

9. Make Your Home More Resistant to Water and Weather Damage

You cannot prevent every storm or weather event, but there are steps you can take to reduce the risk of damage.

Depending on where you live, consider:

• Installing a backwater valve
• Adding sewer backup protection
• Maintaining a reliable sump pump
• Having a backup power source for your sump pump
• Keeping gutters and downspouts clear
• Trimming trees and branches near your home
• Improving attic insulation and ventilation
• Using appropriate fire-resistant materials in wildfire-prone areas

Some of these improvements may qualify for insurance discounts, while others simply help reduce your chances of having to make a claim.

Ask your insurer which measures are recognized under your policy.

10. Review Your Coverage Every Year

Your home and circumstances can change over time, so it makes sense to review your insurance policy at least once a year.

Look at:

• Dwelling coverage
• Contents coverage
• Personal liability coverage
• Additional living expenses
• Sewer backup coverage
• Overland water coverage
• Other optional coverage that may apply to your property

Make sure your dwelling coverage is appropriate for the estimated cost of rebuilding your home. The market value of your house is not necessarily the same as its replacement cost.

The goal should not simply be to have the cheapest possible policy. It is to have appropriate coverage at a price you can afford.

11. Review Your Contents Coverage

Take a look at your belongings and make sure your contents coverage still makes sense.

A home inventory can help. Walk through each room and take photos or video of your belongings. Keep receipts for expensive purchases when possible.

If you have sold or donated expensive items, let your insurer know if they were specifically listed on your policy.

Jewellery, artwork, collectibles and certain electronics may have special coverage limits, so ask your insurer whether additional coverage is necessary.

Do not reduce your contents coverage simply to save money unless you are confident that the new limit would adequately protect your belongings.

12. Protect Your Claims-Free Record

Your claims history can affect the cost of home insurance, so it is worth thinking carefully about smaller claims.

For example, if you have $1,200 in damage and a $1,000 deductible, you would only potentially recover $200 before considering any other factors. It may make more financial sense to pay for the repair yourself.

However, do not assume that you should avoid reporting a loss simply because it is relatively small. Insurance policies have different requirements, and failing to report an incident when you are required to do so could create problems later.

If you are unsure, ask your insurance company how the situation would be handled before making a decision.

13. Ask Your Insurance Company to Review Your Policy

You do not have to wait until your renewal date to ask your insurer about your premium.

Give them a call and ask whether your policy can be reviewed.

You could say:

“I’ve been reviewing my household budget and would like to see if there are any ways to reduce my home insurance premium. Could you review my policy and make sure I’m receiving all of the discounts I qualify for?”

You can also ask:

• Are there any new discounts available?
• Would increasing my deductible reduce my premium?
• Would a security system qualify for a discount?
• Would a water leak detection system qualify?
• Would bundling my home and auto insurance save money?
• Has anything changed about my home’s risk rating?
• Are there any optional coverages I should review?

A simple phone call could uncover savings you did not know were available.

14. Get New Quotes Before Your Renewal Date

If your current insurer cannot offer a competitive price, start comparing quotes before your policy renews.

Having your current policy information available makes it easier to compare similar coverage from different companies.

Try to compare the same:

• Coverage limits
• Deductibles
• Optional coverage
• Liability limits
• Water protection
• Replacement cost provisions

Do not cancel your existing policy until you have confirmation that your new coverage is active.

15. Don’t Cut the Wrong Coverage Just to Save Money

There is a big difference between reducing unnecessary costs and becoming underinsured.

Before removing coverage, consider what you would actually have to pay if something went wrong.

Be especially careful about reducing:

• Personal liability coverage
• Sewer backup coverage
• Overland water coverage
• Other water-related protection
• Coverage needed to rebuild your home properly

Saving a few dollars each month may not be worthwhile if it leaves you responsible for a large expense after a serious loss.

Quick Ways to Potentially Lower Your Home Insurance Premium

Strategy	Potential benefit
Compare insurers	You may find a lower rate
Increase your deductible	A higher deductible can reduce your premium
Bundle policies	You may qualify for a multi-policy discount
Improve home security	Some systems qualify for discounts
Install approved leak detection	May reduce risk and qualify for a discount
Update older systems	May improve your home’s insurability
Maintain a claims-free record	May help you qualify for better rates
Review coverage annually	Helps ensure you are not paying for coverage you no longer need
Ask about discounts	You may discover savings you were not receiving

Frequently Asked Questions

How can I lower my home insurance premium?

Shopping around, increasing your deductible, bundling insurance policies and asking about available discounts are some of the most common ways to potentially reduce your premium.

Why has my home insurance gone up?

Home insurance premiums can be affected by factors such as construction costs, repair costs, claims in your area, severe weather, your home’s characteristics and changes in the insurance market.

Does a security system lower home insurance?

Some insurance companies offer discounts for approved security systems. Contact your insurer before purchasing one to find out whether the system qualifies and how much you could save.

Does increasing my deductible lower my insurance premium?

Generally, choosing a higher deductible can lower your premium because you are agreeing to pay more of the cost if you make a claim.

Does bundling home and auto insurance save money?

It can. Many insurers offer multi-policy discounts, but it is still worth comparing the total cost against separate policies from other companies.

Can a new roof lower home insurance?

A newer roof may reduce your risk of certain types of damage and may qualify you for a better rate with some insurers. Ask your insurance company how the age and condition of your roof affect your premium.

How often should I shop around for home insurance?

It is a good idea to compare your options around renewal time, particularly if your premium has increased significantly. You do not necessarily need to switch companies every year, but comparing quotes can help you determine whether your current rate remains competitive.

What home improvements can lower insurance premiums?

Depending on your insurer, improvements such as a new roof, updated electrical or plumbing systems, approved security systems and water protection equipment may qualify for discounts.

Is it cheaper to pay home insurance annually?

Some insurers may charge additional fees for monthly payment plans, while others may not. Ask your provider whether paying annually would reduce your overall cost.

Can a claims-free record lower my home insurance?

A claims-free history may help you qualify for better rates or discounts with some insurers. The exact rules vary by company.

Conclusion

You cannot control the cost of building materials or the weather, but you can take steps to make sure you are not paying more than necessary for home insurance.

Start by reviewing your current policy and asking your insurer about available discounts. Then compare a few quotes to see how your price stacks up.

Increasing your deductible, bundling policies, improving home security and keeping your home well maintained may also help reduce your costs.

Just remember that the cheapest policy is not always the best policy. The goal is to find affordable insurance that still gives you the protection you would need if something went seriously wrong.