MyChoice releases 2025 Ontario Home Insurance Market Overview

Ontario home insurance premiums rose 7.15% in 2025, driven mainly by climate change

See which cities pay the most, why rates are climbing, and how to lower your home insurance costs

Toronto, ON (July 16, 2025) – Home insurance costs in Ontario are climbing at an alarming rate, adding to the financial strain on homeowners. In 2025, the average home insurance premium in Ontario jumped by about 7.15% compared to 2024, a rise far above general inflation (2.3% for 2025), and above the national average of 5.3%. This surge continues a multi-year trend of escalating home insurance rates – in fact, Ontario premiums have increased 84% between 2014 and 2024, vastly outpacing the 28% growth in general consumer prices over the same decade. The culprit behind these steep hikes is largely the growing impact of climate-related disasters and higher rebuilding costs. Insured losses from extreme weather hit a record $8.5 billion in 2024 (the highest in Canadian history), including catastrophic events like the 2024 Jasper wildfires ($1.1 billion in insured damages) and Ontario’s 2024 summer flash floods (~$940 million in insured damages). Such frequent, severe disasters are driving up home insurance claims and expenses across the country, forcing insurers to raise premiums to keep pace with the heightened risk.

To measure the impact of these pressures on Ontarians, our team at MyChoice – a leading Canadian insurtech company – conducted an in-depth analysis of year-over-year home insurance rate changes across Ontario municipalities. We examined thousands of real quotes generated on MyChoice between January and September 2025 and compared them to the same period in 2024. For consistency, we focused on a standard homeowner profile: a 35-year-old (male or female) homeowner with a clean claims history, living in a 3–4 bedroom detached or semi-detached home (~2,000–2,500 sq. ft., ~$1 million replacement value). This homeowner has a $1,000 deductible, $1 million liability coverage, an Enhanced Water Protection endorsement, and safety features like monitored fire/burglar alarms and a fire extinguisher – reflecting common insurance discounts. By controlling for profile and coverage, we could isolate market rate inflation and compare premium movements across different cities on an apples-to-apples basis.

The findings provide a clear picture of how much more Ontarians are paying for home insurance in 2025, and which communities saw the sharpest increases. Below we highlight the key results and explore the factors – from wildfires to floods – that are pushing home insurance costs to new heights.

Key Findings from the Study

• Ontario’s average home insurance premium rose by 7.15% in 2025. This provincial jump in insurance rates is significantly higher than general inflation (2.3% for 2025) and reflects a broader national trend of rising home insurance costs driven by climate-related claims.
• Northern Ontario communities saw the steepest increases. Thunder Bay (+26.39%) experienced the largest spike in the province. Other northern cities, such as North Bay (+22.64%), Huntsville (+19.72%), Kenora (+9.32%) and Sudbury (+8.56%) also saw significant increases in home insurance costs. These areas now face significantly higher premiums, likely reflecting their exposure to elevated climate-related risks (e.g. wildfires, floods and severe storms).
• Wildfire-prone northern cities are paying the price. Communities flagged in MyChoice’s 2025 wildfire risk study – including Kenora (+9.32%), Timmins (+8.86%), and Sudbury (+8.56%) – all recorded above-average home insurance inflation. These areas face heightened claims risk tied to rising wildfire activity.
• Flood-prone cities are seeing steep premium hikes as well. Some of Ontario’s municipalities identified in MyChoice’s flood risk study, such as Pembroke (+22.17%), Ajax (+22.11%), Ottawa (+14.30%), and Mississauga (+11.86%), all posted some of the most significant home insurance increases this year.
• Significant increases hit parts of Eastern Ontario and the GTA. Mid-sized cities such as Brockville (+16.77%), Burlington (+15.97%), Belleville (+14.26%), Richmond Hill (+12.78%), London (+12.15%) and Windsor (+11.65%) all recorded double-digit percentage increases in premiums.
• Some cities saw mild increases or even declines. A few Ontario communities managed to escape hefty rate hikes. For example, Gravenhurst was nearly flat (+0.10%), and Innisfil (+0.21%), Welland (+0.50%), and Stratford (+0.64%) saw negligible upticks. Notably, several cities actually experienced premium decreases: Woodstock (−5.86%), Waterloo (−5.11%), Orangeville (−3.87%), Niagara Falls (−2.67%), and Barrie (−2.08%) all saw modest relief in average rates compared to 2024. This uneven pattern suggests that other local factors (such as the number of actual claims, competition among insurers, or risk mitigation efforts) can lead to divergent outcomes, even as the overall trend is going upward.

It’s worth noting that insurers adjust premiums based on very localized data – everything from wildfire exposure and floodplain mapping to crime rates and even the availability of fire services can influence pricing in a given community.

“Even within the same province, insurers calibrate their rates based on very localized risk data,” explains Aren Mirzaian, CEO of MyChoice. “That’s why you sometimes see sharp differences in premiums between neighbouring communities – each area has its own claim trends and risk factors. Areas prone to costly disasters or frequent claims will inevitably see insurers charging more to cover that elevated risk.”

To view the complete table of provinces with calculations and methodology, visit the MyChoice study.

Why Are Home Insurance Rates Climbing So Fast?

Several converging forces are driving Ontario’s home insurance premiums upward. Here are the key factors behind the 2025 rate surge:

• Climate Change & Extreme Weather: Canada is seeing more frequent and severe disasters – wildfires, floods, windstorms, hail – and Ontario has not been spared. 2024 was the costliest year on record for weather-related insured losses in Canada (CAD $8.5 billion). In Ontario, flooding is a particularly costly threat. Heavy rainstorms and overflowing rivers have led to flash floods in the GTA and eastern Ontario, causing hundreds of millions in property damage.
• Rising Rebuilding Costs: Even aside from climate-related events, the cost to repair or rebuild homes has increased significantly in recent years, and this inflation feeds into premiums. Construction materials and labour have become much more expensive – supply chain disruptions, economic uncertainty and tariffs drove up prices of lumber, steel, and other building supplies, and while general inflation has cooled, construction costs remain elevated.
• Higher Claim Frequency: Beyond headline-grabbing catastrophes, insurers are also seeing more frequent small-to-medium claims, especially related to water. Water damage has become the leading cause of home insurance claims in Canada (48% of all claims). Ontario’s aging municipal infrastructure (storm sewers, etc.) can struggle to handle extreme rain, leading to sewer backups and basement flooding – costly events often not covered by default policies unless add-ons are purchased.
• Insurance Industry Strains and Reinsurance Costs: The tougher climate has not only impacted primary insurers but also the global reinsurance market, which backs them. After the catastrophe-filled 2023–2024 period, reinsurers significantly tightened their terms and raised prices for coverage. Many Canadian insurers had their reinsurance programs triggered by the big losses in 2024, and at renewal, they faced risk-adjusted reinsurance rate hikes of 10% to 40% on loss-affected programs.
• Localized Factors such as Crime: Home insurance pricing also reflects local considerations beyond climate. Neighbourhoods with higher crime or theft rates may see higher premiums due to the risk of break-ins and vandalism. Rural or remote areas lacking nearby fire stations or hydrants often face surcharges because a house fire there is more likely to result in a total loss. Additionally, if a town has a history of high insurance fraud or frequent small claims, insurers may factor that into the cost.

For more information, plus tips on how to lower your home insurance premiums, visit the MyChoice study.

About MyChoice

MyChoice is a Toronto-based Insurtech company that equips brokers and insurance companies with tools they need to excel in operations and client acquisition. Their rate comparison site MyChoice.ca, gives Canadians access to competitive auto, home, and life insurance rates. MyChoice blends their industry knowledge with cutting-edge technologies to build solutions that significantly enhance brokerage and insurance company processes and workflows. For more information, visit www.mychoice.ca.

SOURCE: My Choice Financial, Inc.

Tags: home insurance, InsurTech, MyChoice, Ontario, tips