Canadian households are facing rising insurance costs, with a new report from Rates.ca revealing that the majority of policyholders have experienced premium increases in recent years.
According to a Leger survey conducted for Rates.ca, about 75% of Canadians with at least one insurance policy—covering a home, apartment, condominium, or vehicle—said their premiums have increased over the past two years. The findings highlight growing financial pressure on households as insurance costs climb alongside broader living expenses.
Age appears to play a role in how widely these increases are felt. Canadians aged 35 and older, who are more likely to own both homes and vehicles, reported higher rates of premium hikes. Around 78% of respondents in this age group said their insurance costs had risen, compared with 64% among those aged 18 to 34.
In response to the rising costs, many Canadians are taking steps to manage their insurance spending. The report found that 63% of insured respondents have attempted to reduce their premiums. The most common strategies include shopping around for better rates, cited by 40% of respondents, asking insurers for discounts (30%), and adjusting or removing parts of their coverage (21%).
The report also points to steadily rising home insurance costs across several major Ontario cities. Between 2022 and 2025, premiums increased in Toronto, Hamilton, Oshawa, Windsor, London, and Ottawa. The sharpest increases occurred in 2024 before moderating slightly in 2025.
Several factors have contributed to the upward trend. Severe weather events—ranging from wildfires to floods—have driven up claims, while rising construction costs have also pushed insurance expenses higher. Analysts note that tariffs imposed by U.S. President Donald Trump on Canadian goods have increased the cost of building materials, further influencing home insurance rates.
Meanwhile, auto insurance continues to represent the largest share of household insurance spending in many areas. In Toronto, the average annual auto insurance premium rose from $3,453 in 2022 to $3,997 in 2025, accounting for roughly 70% of total household insurance costs in the city.
Across six major cities in Ontario, auto insurance consistently makes up between 60% and 70% of the average household’s insurance expenditures, underscoring its dominant role in overall coverage costs.
One of the main drivers behind higher car insurance premiums is the rising cost of vehicle repairs. Labour shortages and supply chain disruptions have increased the price of parts and delayed repairs, pushing insurers’ expenses higher.
“If insurance companies have to pay more money than anticipated, premiums will go up,” said Daniel Ivans, insurance expert at Rates.ca and a licensed insurance broker.
Ivans noted that virtually every stage of vehicle repair—from diagnostics to parts and labour—now costs significantly more than it did just a few years ago. As wages and living costs increase, the price of repairs rises accordingly, forcing insurers to adjust premiums to cover growing claim expenses.
The type of vehicle drivers purchase can also have a significant impact on insurance rates. Dan Park, chief executive of Clutch Canada, a platform for buying and selling used vehicles, said higher-end or frequently stolen models tend to carry higher premiums.
According to Park, some customers have abandoned vehicle purchases after discovering how expensive insurance would be. In particular, popular models such as the Honda CR-V and Civic have seen premium spikes due to their higher theft rates.
“We’ve had customers cancel purchases on CR-Vs and Civics specifically because their premiums spiked when they quoted a high-theft model,” Park said.
In one case, he added, a customer saw their insurance premium nearly double after requesting a quote and ultimately decided not to proceed with the purchase.
