Wildfire risk and home insurance pricing in Canada

A renewal arrives with a higher number on it and nothing about the house has changed. No claim, no fire within hundreds of kilometres, same roof, same neighbourhood. The increase is real and it has a cause — it just isn't local. Wildfire and other catastrophe losses reach premiums through a chain that starts with a burned town in one province and ends on a renewal letter in another. This guide follows that chain, then narrows to the part of it a homeowner can actually influence.

TopRates.ca is educational. We don't sell or arrange insurance, and nothing here is advice for your situation — it's the background to bring to a licensed insurance professional.

The scale changed before the pricing did. Two decades ago, insured losses from severe weather in Canada seldom passed $500 million in a year. Across 2006 to 2015 they totalled roughly $14 billion. Across 2016 to 2025 they totalled about $37 billion — nearly triple, on Insurance Bureau of Canada figures.

2024 set the record at $8.5 billion. 2025 came in around $2.4 billion — a calmer year by recent standards, and still the tenth costliest on record. The IBC's own framing is the line worth keeping: annual costs above $1 billion have become the norm rather than the exception. The 2025 total was assembled from ordinary-sounding events:

• A late-March ice storm across Ontario and Quebec — about $466 million.
• May wildfires around Flin Flon, Manitoba and La Ronge, Saskatchewan.
• A July hailstorm in Calgary, and August storms with hail damage around Brooks, Alberta.
• December flooding in British Columbia.

Wildfire is one line in that list rather than the whole story — but it produces the largest single shocks. The July 2024 Jasper wildfire caused more than $880 million in insured losses on its own, which placed it among the ten costliest insured disasters in Canadian history.

Insurers buy insurance. Reinsurance is the layer that absorbs the tail — the year one fire destroys a third of a town, or three hailstorms land in the same quarter. Your insurer keeps the routine claims, transfers the catastrophic ones, and pays a premium for that transfer. That premium is a cost of doing business in every province, whether or not the province burned.

That cost moved sharply. Reinsurance rates hardened for four consecutive years, climbing through a difficult 2025 renewal. Heading into 2026 the direction reversed: Guy Carpenter Canada's outlook points to a softening market, driven by limited global catastrophe losses in 2025 and reinsurers competing for growth.

Softening at the reinsurance layer does not arrive at a renewal on the same schedule. Canadian home premiums are estimated to have risen roughly 7% to 12% on average in 2026, with high-risk postal codes seeing 15% or more. Three things sit behind that lag: prior catastrophe losses still working through insurers' results, the cost of the hard reinsurance years being recovered, and rebuild costs — materials and labour — that rose independently of any fire.

Frequency does its own work. By August 2026, 14 catastrophe events had been declared in Canada, a pace comparable to 2023's record of 26 in a single year. A steady run of moderate events strains loss experience differently than one enormous fire, and it reaches policies well outside any disaster zone.

One structural note for Ontario readers: auto insurance rates here are reviewed and approved by FSRA before an insurer can charge them. Home insurance is not rate-regulated in that way. Property pricing moves with the market, which is part of why the two lines on a household budget behave so differently.

A severe fire season and an expensive fire season are two different measurements, and the news covers the first one.

By late July 2026, roughly 2.95 million hectares had burned nationally — above the ten-year average of about 2.55 million — with more than 900 fires active. The distribution matters more than the total. Ontario accounted for over 732,000 hectares across 179 active fires, while British Columbia (about 43,000 hectares) and Alberta (about 18,000) were both running below their averages.

Morningstar DBRS put the insurance logic plainly: the impact on insurers depends less on total area burned than on whether fires threaten major population centres and concentrations of insured property. Most of the 2026 burned area sits in remote regions where insured values, property density and commercial activity are low. A million hectares of boreal forest can produce less insured loss than one fire that reaches a town.

That is why Fort McMurray in 2016 and Jasper in 2024 dominate the record books. The loss event is a community, not a landscape.

Wildfire is already covered. Fire, including wildfire, is a standard peril in a typical Canadian home policy — no endorsement, no separate purchase. That places it in a different category from the perils people often assume are equivalent:

• [@portabletext/react] Unknown block type "span", specify a component for it in the `components.types` propNot standard. Each is an add-on with its own limit and deductible.
• [@portabletext/react] Unknown block type "span", specify a component for it in the `components.types` propA separate endorsement, usually carrying a percentage deductible in the 5% to 20% range rather than a flat dollar amount.
• [@portabletext/react] Unknown block type "span", specify a component for it in the `components.types` propUsually included, and the coverage that matters most in an evacuation. It pays the cost of living elsewhere — accommodation, meals above your normal spend, pet boarding — while the home can't be occupied.

Evacuation coverage deserves a closer read than it usually gets. Policies differ on what triggers it, whether a formal evacuation order is required, how long it runs and what dollar cap applies. It also generally will not respond to a flood or earthquake evacuation unless those perils are carried. Find the clause before a season starts, not during one.

Two other lines are worth checking at renewal. Your deductible is the fastest lever on a premium in either direction. And your rebuild limit — guaranteed replacement cost, or a stated amount — decides what actually gets rebuilt. With construction costs where they are, a stated amount set several years ago may no longer rebuild the house it was written for.

Home hardening works, and the measures are unglamorous: Class A roofing, ember-resistant vents, non-combustible material in the first 1.5 metres around the foundation, cleared gutters and deck undersides, woodpiles moved away from the wall. FireSmart Canada's guidance is the standard reference, and most of it is a weekend rather than a renovation.

Whether that work reduces your premium is a separate question, and the honest answer is that it depends on your insurer. Canada has no standardized framework requiring completed mitigation to produce a specific discount. Some companies do price it — BCAA has offered a 15% discount for a policy term after a FireSmart BC assessment, and Co-operators discounts the wildfire-peril portion of premiums for clients certified through its wildfire mitigation program or living in FireSmart-recognized neighbourhoods. The Insurance Bureau of Canada has noted it cannot compel members to offer such incentives. California and Colorado have taken the regulatory route and required the link; Canada so far has not. Ask your own insurer directly rather than assuming either way.

So the control splits in two.

• [@portabletext/react] Unknown block type "span", specify a component for it in the `components.types` propdeductible and limits, mitigation work, an up-to-date home inventory, and shopping the renewal — a 7% to 12% market benchmark makes an outsized quote easier to recognize.
• [@portabletext/react] Unknown block type "span", specify a component for it in the `components.types` propthe reinsurance cycle, your province's catastrophe experience, rebuild cost inflation, and the fuel load around your community.

That second list is why a renewal can rise in a year when nothing happened to you. It is not a judgement on your house.

Does home insurance cover wildfire damage in Canada?

Yes. Fire, including wildfire, is a standard covered peril in a typical home policy — it does not need to be added. The questions worth asking are about your limits, your deductible and your rebuild basis, not about whether the peril is there.

Why did my premium go up when there was no fire near me?

Catastrophe costs are pooled and reinsured nationally, and rebuild costs rose everywhere. Your premium reflects your insurer's total exposure and cost base, not only your postal code — though your postal code affects how much of that base you carry.

Reinsurance rates are softening. Will my premium fall?

Not necessarily, and not immediately. Estimates for 2026 still show average home premiums rising 7% to 12%, and more in high-risk areas. Relief at the reinsurance layer takes time to reach primary pricing, and it competes with claims and construction inflation on the way.

I was evacuated but my home survived. Am I covered?

Often yes, through additional living expenses coverage — but the terms vary on whether an official order is required, how long the coverage runs and what it caps at. That is the clause used most often in a wildfire season, and the one most worth reading in advance.

Can an insurer refuse to cover a home in a high-wildfire area?

Insurers underwrite by location, and appetite differs between companies and changes over time. Availability and price in exposed areas are set company by company, which is a practical argument for working with a broker who can approach several markets rather than one.

Insurance Bureau of Canada, including its 2025 severe weather insured loss release and its Jasper wildfire statements, with catastrophe data from CatIQ; Public Safety Canada's 2026 wildfire season updates; Guy Carpenter Canada's 2026 outlook and Morningstar DBRS commentary as reported by Canadian Underwriter; the Financial Consumer Agency of Canada on insurance for unexpected events and disasters; FireSmart Canada and FireSmart BC. Figures are as published at the time of writing and move with each season — confirm current numbers and your own policy terms with your insurer or a licensed professional.

This article is educational. Quotes are not offered or arranged on this site.