An increase in home and auto insurance premiums are occurring across all of Canada, affecting a great number of Canadians.
Here we review the tops reasons for the increase and what actions you can take to help ensure your premiums remain affordable.
Why are insurance premiums increasing?
Home: The increase in severe weather events across Canada has resulted in a sharp increase in the number of insurance claims. In the last two years alone, insured losses from catastrophes are estimated to be more than $3.3 billion dollars.
Auto: The technology now available in cars makes them more expensive to repair. Technology such as bumper to bumper sensors, navigation systems and on-board computers designed to prevent crashes have resulted in higher manufacturing and replacement costs in the event of a minor accident where digital electronics need to be replaced entirely.
A rise in distracted driving has resulted in an increase in collisions, which equates to more claims and therefore, an increase in premiums for all Canadian drivers.
Other factors that affect insurance premiums:
Fraud - “The overall cost of fraud was between $769 million and $1.56 billion or between $116 and $236 per car insured,” - according to a KPMG report. In some provinces, such as Ontario, this number has been increasing annually.
Skilled labour shortage - The construction boom in many major Canadian cities, along with the shortage of skilled workers, and the rising cost of labour is having a significant impact on property insurance rates. While construction companies need to pay higher wages to attract and retain quality employees, the increase in the cost is handed down to the consumer.
What Canadian consumers can do about rising insurance premiums
First, it’s important to note two things:
- Insurance rates are on the rise across all of Canada, so finding a lower premium may not be possible.
- If you qualify for a lower premium, it may come with a “trade-off”, such as a substantially higher deductible.
Fully understand your existing coverage - review your policies to ensure you have the coverage that you need. Understanding your coverage and its limitations will help protect yourself against “surprises” in the event you need to make an insurance claim.
Take action in and around your home to help prevent potential insurance claims - such as installing a backwater check valve, invest in basement waterproofing, trim trees and ensure your outdoor possessions are secure, install a home security system – just to name a few.
Drive safe - commit to safe and distraction-free driving and learn defensive driving techniques.
Report fraud - both exaggerated claims and deliberate fraud, such as staged accident, result in increasing insurance premiums for all policyholders. To report insurance crime, anonymously contact The Insurance Bureau of Canada (IBC) Tip Line at 1 877 IBC TIPS (422 8477) or visit the
IBC website.
Stay in contact with your insurance broker - Have you made improvements to your home that may affect its value? Have you upgraded your security system? Have your driving habits changed? Has it been several years since your last ticket? There are factors which may qualify you for an insurance premium discount.
If you’re curious if you could save money on your insurance premiums, and if your insurance is renewing soon, we invite you to receive an online quote, anytime, with EasyInsure.
If you need to speak with us, please reach out: 1-800-679-2640 or email:
info@easyinsure.ca