Dwelling insurance could be dearer in smaller cities: Specialists – Canadian Underwriters

Since some Canadians want to stand out from larger cities and move to smaller communities, insurance professionals should be aware that living in a small town can often mean higher home insurance premiums.

According to financial products comparison site Ratesdotca, the average cost of insuring a home in places like the Windsor-Essex area and the Sudbury, Ontario area was around $ 2,000 a year.

That compares with averages of between $ 1,200 and $ 1,350 per year in Toronto and around $ 1,000 in some communities in the greater Toronto area.

While the company has no data for other provinces, Ratesdotca editor-in-chief John Shmuel said he expected the trend towards higher rates in smaller communities would continue.

Jesmond Tabone, president of the owner of Tabone Insurance Brokers in Windsor, Ontario, points out that cities like Windsor often have more single-family homes and larger lots, which can drive up premiums as homeowners may need more insurance coverage.

"It's not the houses themselves that are the problem, but the type of coverage that would apply to the house," said Tabone.

"More land is also an issue, because that way there is more liability."


Shmuel said higher crime rates and greater exposure to natural disasters like flooding are some of the reasons homebuyers in smaller locations can expect higher premiums.

He pointed out that contrary to popular belief, smaller cities often have higher crime rates than some larger cities.

“It depends on how the home insurance is calculated by the insurers. An insurer is trying to assess the risk of an adverse event in your insured home, ”Shmuel said, saying climate change is a particular concern in the industry.

“Cities like Toronto have undertaken a number of major projects to better protect themselves from flooding and the increasing intensity of storms. Meanwhile, rural and small town areas … may not be as well prepared for flooding. "

Shmuel noted that Windsor was one of the worst cities in Ontario for high insurance rates due to a mix of high crime rates and flooding.

Both Tabone and Shmuel say homeowners have options to lower their home insurance rates.

Getting a sump pump (which removes excess water from a basement during floods) or a check valve (which prevents water from flowing improperly from a sewer during heavy rain events) are two ways to lower insurance premiums.

Upgrading your home surveillance system could also be a worthwhile way to protect your property while lowering premiums, though Shmuel said it was important to speak to your insurer about the exact types of systems that are eligible to lower your premium.

Meanwhile, Tabone said it is worth consulting local realtors in the community you are moving to.

"Local insurance brokers know the area better and what is needed than someone sitting in a call center," said Tabone.

Feature image from iStock.com/Steven_Kriemadis

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