You will learn why premiums can go up even if you haven’t made a claim, how to use your declaration pages to investigate, and what to do if there are errors, if you find an equivalent quote elsewhere, or if you want to make a genuine complaint.
Our editorial team investigated the federal home-insurance guide, the federal insurance guide, Insurance Bureau of Canada’s property-cost analysis, and the General Insurance OmbudService’s complaint guide to bring you this guide.
Can My Home Insurance Price Increase at Renewal?
Any change in the rate, the policy or your property file could affect your home insurance price. A personal claim is just one possible reason.
When your insurer offers your home insurance renewal, it can offer you a different premium. It may also propose new limits, deductibles, endorsements or conditions. Everything has to follow the rules of your province or territory, though.
What Can Cause a Renewal Increase?
| Category | Examples | How to check |
|---|---|---|
| Market-wide | Renewal increases can be caused by high repair or rebuilding costs, high reinsurance costs and high catastrophe losses | Have you asked whether there was a territory or broad rate change at the insurer that could explain the increase upon renewal? |
| Insurer-specific | What criteria change could increase your rate upon renewal? Some reasons could include implementation of new rating model, company’s risk appetite, discounting criteria and/or underwriting requirement changes. | If there is an increase at renewal, request the main rating changes made on the renewal to determine the cause |
| Policy-specific | Dwelling limit increases; endorsement additions or deletions; change in the deductible; no longer qualify for the bundle discount | Determine the reason(s) for the increase(s) by comparing old declarations to the new declarations line-by-line. |
| Property-specific | Improvements/Renovations, roof/building utility system age, wood heat, pool, on-site business, rental, vacant, inspection results may cause an increase at policy renewal. | Check your insurer’s property records to make sure they’re up-to-date, as inaccurate information can affect your rates, especially if you’ve made recent changes to your property. |
| Claims and history | Having had a loss; the number of losses; the type of loss; corrections to a claims record | Not all claims affect renewal pricing in the same way so ask which claim or record is the reason for your price increase. |
| Location | Local fire response, higher crime, increased loss experience in your area, hail, wildfire, flood, severe weather events or disasters could result in an increase | Evaluate any changes in hazard/territory maps. Changes in hazard/territory maps can be a factor in increased pricing at renewal. |
| Data or discount error | Incorrect roof year; incorrect occupancy status; incorrect heating type; incorrect alarm status; multi-policy discount not applied where eligible | Request a corrected quote with dated proof when your cost increases at renewal |
Audit the Old and New Declarations Before Shopping
- Compare the old, expiring declarations side by side with the new renewal declarations.
- Circle or underline changes in coverage such as limits, deductibles, endorsements, exclusions, discounts and conditions.
- Next, verify the property description: address, occupancy, number of units, roof, electrical, plumbing, heating, renovations, protective devices, and claims history.
- Ask the insurer or broker what changed to result in the premium movement. Ask the insurer or broker to correct any inaccurate information in writing.
Read More: See Which Home Insurance Shopping Mistakes to Avoid
A Worked Renewal Audit
This fictional example shows that the premium isn’t everything when considering your renewal options.
| Item | Expiring policy | Renewal | What to do |
|---|---|---|---|
| Annual premium | $1,580 | $2,040 | Ask for the rating reasons after checking all lines below |
| Building limit | $520,000 | $610,000 | A renewal needs an updated reconstruction-cost estimate, not a market appraisal. |
| Base deductible | $1,000 | $2,500 | The out-of-pocket amount has gone up. Is this increase affordable? |
| Sewer-backup endorsement | $50,000 | $25,000 | Look at renewal audits in terms of reduced water coverage, not simply in terms of a different price |
| Bundle discount | Included | Missing | Look for any change(s) to the alternate policy. Don’t assume no changes, verify. Request adjustment(s) as applicable. |
| Roof year | 2019 | 2003 | Provide evidence of the project, for example an invoice or permit, so you can ask for it to be re-rated |
This example renewal policy is higher-priced, has a higher deductible, reduced water coverage and a mistake in the property details.
The competing quote is cheaper but isn’t an equivalent policy if it doesn’t restore the missing coverage or use the correct roof year.
Property-Specific Factors Worth Verifying
| Insurer record | Evidence |
|---|---|
| Replacement-cost characteristics | Verify square footage; number of storeys; type of foundation and its condition; building materials and methods of construction; interior and exterior finishes; outbuildings, etc. |
| Roof and systems | Installation dates; building materials; invoices; permits; inspection reports |
| Use and occupancy | Owner or tenant-occupied; suite; short-term rental; home business; vacancy dates |
| Protection | Certificate for monitored alarm system; leak detection/automatic shutoff to prevent water damage; sump pump; backwater valve to protect your house from backup in the drains/sewer line; fire response system |
| Claims | Confirm that all claims are accurate, including: date of loss; cause of loss; cost of loss; repairs; closed status. Ensure that any claims that do not belong to you or your property are corrected |
| Discounts | Bundle discounts; claims-free discounts; mortgage-free discounts; age-based eligibility; group eligibility; device-based eligibility. Specific discounts offered by insurers are worth verifying |
Real-estate appraisals are not intended to determine reconstruction costs. An appraisal determines market value. Your insurer’s estimate should consider materials, labour and other aspects of reconstructing your dwelling.
If your dwelling limit changes significantly, ask your insurer what went into its reconstruction-cost calculation.
Read More: See How Home Value Can Affect a Renewal Quote
Tips for Managing and Reducing Home Insurance Premiums
- When comparing home insurance quotes and coverage, don’t look at premium cost only. Make sure coverage for both your building and its contents is comparable, including settlement basis, water coverage, liability, living expense coverage, deductibles and exclusions.
- Agree to pay a higher deductible only when you know the difference it makes to your premium. Maintain that amount in accessible savings.
- Ask your insurance company about discounts for risk-prevention devices or improvements. Before making improvements or installing devices, ask whether a discount is available. A safer home isn’t always less expensive to insure.
- Ask about discounts for carrying more than one policy with the same insurance company. Find out what it would cost without the multi-policy discount to make sure the discounted rate still isn’t more than what you’d pay elsewhere.
- Before eliminating an endorsement, be certain that you understand what coverage you’ll be giving up. Eliminate endorsements only when there’s no longer any reason to buy the coverage.
- Make sure the information in the policy is correct. Errors may cost you when you have a claim. Keep copies of bills and receipts to prove installation dates and costs. Ask for revised declaration pages.
Read More: Choose a Home Insurance Deductible Before Renewing
Before Paying a Small Loss Yourself
Don’t put off taking steps to minimize additional damage just to preserve your discount. As soon as it’s safe, take all reasonable steps to stop additional damage. Take pictures or videos of the property’s condition, including what caused the loss. Unrepaired damage could cause other problems.
Review your policy’s notice provision to make sure that paying for the loss yourself doesn’t put you in violation of a policy condition. Carefully consider the repair cost versus what you’d be paid after the deductible, whether repairs would fix all of the problems, whether they are temporary and whether similar problems could recur.
Read More: See How a Home Insurance Claim May Affect Renewal
If the Renewal Explanation Is Still Unsatisfactory
Ask the broker or insurer for a letter that explains the renewal. The letter should include the reasons for the decision, any related rating facts and what can be done to correct factual or policy-processing issues.
Separate a factual or policy-processing complaint from disagreement with the price itself.
If you are unhappy about something other than the price of the insurance, follow up using the insurer’s internal complaint process. Keep a copy of the final position letter.
For certain home-insurance issues, the General Insurance OmbudService may be able to review the complaint once you’ve received the insurer’s final position. Rates and availability are outside its mandate and belong with your provincial or territorial regulator.