Wildfires create a host of unique challenges, from damage from the fires themselves to evacuation-related costs to buying insurance coverage in areas where wildfires are a risk.
Using the Financial Consumer Agency of Canada’s disaster-insurance guide, the Insurance Bureau of Canada’s wildfire guide, BCFSA’s guidance for home transactions during a wildfire, and Public Safety Canada’s wildfire-preparedness advice, our content team has prepared a summary of what happens during wildfires, what property and auto-insurance policies typically cover, some policy details to double-check, steps to take during an evacuation, and how wildfires can complicate home-purchase processes or efforts to change your insurance coverage.
Start by checking how your home policy treats wildfire losses.
Does My Home Insurance Cover Wildfires In Canada?
Generally, home and tenant insurance in Canada covers losses resulting from fire and wildfire. However, review your policy, as the amount you receive depends on the terms and conditions, cause of loss, limits, deductibles, basis of settlement, etc. Coverage for smoke and ash damage, inability to access your home, and evacuation costs may be subject to specific terms and limits.
Can I get insurance if there’s a wildfire?
It can be difficult to increase your insurance coverage or obtain coverage when an active wildfire threatens your home. However, a pause on new policies or coverage increases does not normally remove an existing policy or create a wildfire exclusion.
What Each Policy May Protect
| Policy | Typical wildfire-related role | Check before relying on it |
|---|---|---|
| Homeowner | Coverage for dwelling, contents, additional living expenses subject to policy terms. | Also check settlement conditions and deductibles before counting on rebuild limits, detached buildings, debris removal and by-law coverage. |
| Condo unit owner | Personal contents, additional living expenses and improvements to the unit’s interior. Some loss assessments. | Before counting on coverage under the condo corporation’s insurance, make sure you’ve checked the corporation’s insurance policy to understand unit boundaries, whether deductibles are assessed and limits on loss-assessment coverage. |
| Tenant | Contents, additional living expenses and personal liability. | Limits on coverage of tenant’s personal property; possible gaps in coverage under landlord’s building policy. |
| Seasonal property | Seasonal dwelling and property is considered under a different form. | Review occupancy, vacancy, access, fire protection, water shutoff and seasonal exclusions. |
| Auto | Fire damage resulting from wildfire is covered when comprehensive or all-perils coverage has been purchased. | Check deductibles and loss-of-use provisions on your auto insurance before counting on coverage. Your auto insurance policy specifies coverage and deductibles. |
Which Limits And Settlement Terms Should You Check?
Actual Cash Value Vs. Replacement Cost
Replacement-cost settlement usually requires the insured to repair or replace the item as specified in the insurance policy.
Actual cash value may take into consideration the property’s age, condition, depreciation, etc.
For a total loss, check whether your building limits cover rebuilding and tear-down costs, by-law upgrades, and construction costs at the time of the claim.
Read More: Compare Actual Cash Value and Replacement Cost After a Wildfire
Limits That Can Run Out Before The Claim Is Over
What Makes A Property More Exposed To Wildfire?
Risk is specific to each property, not necessarily for an entire city. Factors include the type of surrounding vegetation, wind patterns, terrain, accessibility to firefighting resources and water availability.
It’s a good idea to check hazard information available at the provincial and municipal levels for more information about your specific address. Keep in mind, though, insurers make their own determinations about address classifications, so check with your insurer about coverage, even if available wildfire hazard maps say your address isn’t in an area of concern.
Homebuyers should get insurance quotes for the specific property before waiving the insurance or financing condition on homes in higher-risk areas.
Buying Or Changing Insurance During An Active Wildfire
If there’s an active or imminent wildfire threat to properties in a specific area, insurers may pause selling new insurance or increasing coverage on properties in the area. This doesn’t mean shopping around for insurance is off limits during wildfire season, but a quote isn’t insurance.
Here’s what you need to know if you’re the buyer in a situation like this:
- Get a quote before removing any financing/insurance conditions from the offer.
- Confirm that your insurer can bind coverage for the exact address and closing date.
- Let your real estate and legal adviser know as soon as you run into any issue with insurability if it’s before completion. Do not assume there will be a workaround.
- In British Columbia, the BCFSA has offered some helpful suggestions, including looking at clauses in your offer to purchase that are contingent on being able to insure the home, or asking whether the seller’s insurer can remain on risk. Keep in mind, however, that this is just provincial guidance, not a guarantee that these ideas will work.
What To Do During An Evacuation
- Follow evacuation orders; leave as soon as told. Do not delay leaving to document property.
- Call your insurer as soon as it is safe. Ask for your claim number, expense limitations and any written instructions.
- Save all receipts for extra food, lodging, transportation, etc. costs associated with the evacuation. Keep track of who paid for what.
- Find out if your policy provides for loss of use in the event of an evacuation, inability to enter, actual damage to the structure/contents or some combination thereof.
- Do not discard damaged property unless it is unsafe or the insurer tells you to do so.
Read More: Review Insurance Gaps Exposed by Wildfire Evacuations
How To Reduce Wildfire Risk And Prepare A Claim File
- Store flammable substances away from buildings. Remove flammable vegetation and fuels around buildings, following your area’s wildfire risk guidelines. Keep roofs, decks, gutters and other areas free of dead leaves and other flammable debris. Replace damaged siding, roofing, windows, vents and other components with fire-resistant materials.
- Have a wildfire evacuation plan. Identify more than one escape route. Keep critical documents, medications, and other necessary items within reach. Heed evacuation notices.
- Notify insurer of repairs, renovations, changes in occupancy. Talk with insurer about eligibility for discounts or coverage that reflects your wildfire-preparedness efforts, as wildfire-preparedness efforts alone may not qualify you for expanded coverage or lower premiums.
Read More: See Which Canadian Cities Face Higher Wildfire Risk