Canada’s weather is changing. Environment and Climate Change Canada has found that our climate is warming twice as fast as the global average – and that’s bad news all around. Because of this, we’re seeing more and more extreme weather events across the country. In fact, in 2021 alone, severe weather caused $2.1 billion in damage. From toonie-sized hail in Alberta to tree-felling windstorms and tornadoes in Quebec and Ontario, Canadians need to be prepared for all of it.

As you can see, this is why it’s so important to make sure you’re protected before something happens. This means having the right insurance coverage to take care of your home and your personal belongings if they’re damaged by a natural disaster. It’ll also help you cope with what could come after – like if you’re left without somewhere to live.

Does home insurance cover natural disasters in Canada?

Thankfully, yes. Most severe weather events are covered by your basic home insurance. But, natural disasters have become an increasing concern for insurers since they’re happening so often and cause so much damage. An insurer could put limits or even refuse to offer certain coverages, depending on if you live in a high-risk area. Don’t assume you’re covered for natural disasters. Read your policy carefully (yes, even the small print!) and contact your insurer to find out what you’re covered for and what you’re not.

Which natural disasters are covered by home insurance? 

Home insurance is there for you if you need to repair or replace your home after certain unexpected events (also called perils in the insurance industry). Since natural disasters are unpredictable, some – but not all – are usually covered under a homeowners policy. These include:

• Fire (including wildfires)
• Hailstorms (except in Alberta, where you need to buy hail coverage as an additional coverage)
• Ice storms
• Windstorms
• Tornadoes
• Hurricanes

Did you know? Calgary’s 2021 hailstorm caused $500 million in losses. Severe windstorms and hail can cause some serious damage to your roof. Inspect your roof yearly to check for weaknesses, and repair it to prevent more damage.

What about flooding and earthquakes? Are they covered by my home insurance? 

Floods, earthquakes and landslides generally aren’t covered under most home policies. Many Canadians just assume their home insurance protects against a whole range of natural disasters. But, that’s not the case. And unfortunately, people often only realize it once it’s too late after a disaster has struck. They end up having to dig into their savings to pay for costly repairs, or even rebuild completely. Carefully review your home policy to make sure you’re not missing an important coverage that could save you a lot of money down the line if the worst happens.

The good news? Most home insurers allow you to purchase add-on insurance (also called an endorsement) for overland water flooding and earthquakes. There is no separate endorsement for landslides on their own.

Here’s what you could be covered for under each endorsement:

• Overland water coverage: In a nutshell, this protects against water damage caused by overflowing bodies of fresh water. Fresh water includes lakes, rivers, and ponds, as well as heavy rainfall, and melting snow.
• Sewer backup coverage: This covers you for water damage caused by a blockage in the main sewage line where wastewater reverses direction and flows up into the home. Sewer backup often comes as a package deal with overland water, so you might have to buy them together – which is in your best interest, anyway, since sewer backup often happens as a result of overland water.
• Earthquake coverage: Without this special add-on, you only have coverage from fires and explosions caused by an earthquake. By adding this endorsement, you’ll be covered for direct damage from the actual quake – and landslides that might happen after.

Heads up! Flooding is now the number one cause of insurance losses in Canada, surpassing even the serious wildfires out west. Just one heavy summer storm could cause thousands of dollars in damage in no time at all. Should you get flood insurance? Your insurer will probably say yes. Talk to them to discuss your options and find out what coverage works best for you and your home.

How do I know what kind of natural disaster insurance I need for my home? 

Here’s what you should consider when you’re thinking about natural disaster insurance:

• Assess your home’s “risk level” for natural disasters. It’s a good idea to know if your area is prone to certain natural disasters. Knowing the risk will help you decide the amount of coverage you need. Be sure to discuss it with your insurer – they can offer you their expertise so you can be sure you’re fully protected. For example, let’s say your flood coverage amount is set to $10,000. The average cost of claims for flood damage is $43,0003 – so ten grand won’t cut it. They’ll be able to help you find the right limit to make sure everything will be covered.
• Check if you have guaranteed replacement cost for your home. Guaranteed replacement cost allows you to rebuild or replace your property without deduction for depreciation, even if the cost goes beyond the limit of your home due to the rising cost of materials, labour, and more. With the rate of inflation on the rise in recent years, having this on your policy is a wise move.
• Find out if you’re covered for extra living expenses after a loss. What will you do if your home is unlivable after, say, a major windstorm tears off your roof? Where will you sleep and cook? Most home insurance policies cover extra expenses like costs for shelter, food, and even clothes. Make sure you have enough coverage to take care of yourself and your family after something happens. And keep in mind, your policy could have a dollar limit on these expenses, or on the length of time they’ll pay them. Discuss this with your insurer so you’re well prepared in advance.

Did you know? It’s not only Canada’s west coast that has earthquakes. Certain areas in Ontario and Quebec – like the St. Lawrence River Valley – are prone to quakes, too. But, only 3% of Quebecers have extra earthquake protection. If you live around the valley, get in touch with your home insurance provider to find out if you need earthquake coverage.

How much does natural disaster insurance cost?

There are a few factors related to natural disasters that an insurer could look at when determining your premium:

• Where you live: If your home is located in a high risk area – like a tornado alley, for example, or a flood plain – you could be paying more for your insurance since there’s a higher chance you’ll have to file a claim.
• The age and cost of your home: How much would it cost to repair your home if a natural disaster struck? Insurers consider the age and rebuild cost of your home and factor it into your price.
• The coverage limit you need: If you have higher limits, your payments will likely cost more. But, higher limits are usually worth it! If something happens and you have the highest limit, you won’t have to worry about whether or not your home and all your stuff is covered.

What can I do to prepare my home for natural disasters? 

Natural disasters can cause anything from repairable damage to your home (like broken windows after a windstorm) to some pretty major destruction (like a total loss of your home from a wildfire). That’s why getting your home ready for a natural disaster is a must. While you probably won’t be able to stop all damage, you might be able to mitigate the loss by adapting your home and preparing in advance. Installing weather-resistant roofing and siding, trimming or even removing weak trees around your house, and putting in a sump pump with backup power are all smart ways to reduce the risk of serious damage.

There are also last-minute things you should do if severe weather’s about to hit, like securing your patio furniture and anything that could fly away and cause damage. Ask your insurer if there are other things you can do to help storm prep your home.

Lucky for us Canadians, the Institute for Catastrophic Loss Reduction has handy guides to preparing for all the common types of natural disaster that can occur in Canada. Find out how you can make your home more resilient to floods, snowstorms, windstorms and more.

No one likes to think about their home being damaged – or worse, destroyed – but you need to be prepared. Do your research and work with your insurer to get your home ready in case the worst happens. And, make sure you have the right coverage so you aren’t left with hefty bills to pay to repair – or even rebuild – your home.

Have questions about what’s covered under your Sonnet policy? Contact us – we’re happy to help. Plus, at Sonnet our claims team is available 24 hours a day and are ready to help get you back to good if something happens.