Key Drivers of Rising Insurance Premiums in Canada: Statistics and Data
Canadian home insurance premiums rose 45.0% between December 2019 and December 2025. Passenger vehicle insurance premiums rose 23.9%. The all-items Consumer Price Index rose 21.0% over the same period.
Three cost pressures sit behind those increases: extreme weather claims, the cost of repairing and rebuilding property, and vehicle prices and theft. Each is measurable, and each moved in a different way over the six years.
Catastrophic event claims cost Canadian insurers $8.6 billion in 2024, against $3.4 billion in 2023 and a previous six-year high of $3.6 billion in 2022. The 2024 figure is 152.9% above the year before and 2.4 times the previous peak.
Across the six years from 2020 to 2025, catastrophic claims totalled $23.1 billion, an average of $3.9 billion a year. A single year, 2024, accounts for 37.2% of that total.
2025 moved sharply the other way, falling 72.1% to $2.4 billion, the lowest of the six years. Every year from 2020 to 2025 ranks among the ten costliest on record for extreme weather claims in Canada, which is the more useful framing: the baseline has moved, and 2024 sat far above even that raised baseline.
Homeowners' Claims Expenses Reached $13.2 Billion in 2024
Insurer expenses on homeowners' insurance rose from $6.0 billion in 2020 to $13.2 billion in 2024, an increase of 120.0%. The 2024 figure is an all-time high. In 2025 the figure eased to $11.7 billion, still 95.0% above the 2020 level.
The largest single-year increase came in 2023, at 43.7%, in a year when catastrophic claims actually fell. That points to the second driver.
Rebuild Costs Rose 69.4% in Six Years
The Residential Building Construction Price Index rose 69.4% between the fourth quarter of 2019 and the fourth quarter of 2025. Homeowners' maintenance and repair costs rose 19.1% over a comparable period, and auto part, maintenance and repair costs rose 22.6%.
The 69.4% figure is the one that matters most for property insurance, because it prices the work of rebuilding rather than maintaining. An insurer settling a total loss in 2025 is paying 2025 construction costs on a policy that may have been written years earlier, and the gap between the construction index and the general price level is where a large part of the premium increase originates.
Construction cost inflation, tariffs on building materials and shortages of skilled trades all feed that index. The effect compounds after a catastrophic event, when demand for trades and materials in a single region spikes at once.
Auto Claims Expenses Reached $23.0 Billion in 2024
Insurer expenses on auto insurance claims fell during the pandemic, from $13.3 billion in 2020 to $12.0 billion in 2021 as traffic volumes dropped. They then rose 55.6% in 2023 to $19.3 billion and a further 19.2% in 2024 to $23.0 billion. The 2024 figure is 91.7% above the 2021 low.
Two pressures drive the auto figure. Vehicle prices rose, which raises the cost of every total loss and every parts claim, with auto part, maintenance and repair costs up 22.6% over the six years. Auto theft rose over the same period, and a stolen vehicle is settled at full replacement value rather than at repair cost.
In 2025 auto claims expenses eased 3.9% to $22.1 billion, still 66.2% above the 2020 level.
Home Premiums Rose 45.0% Against 21.0% Inflation
Between December 2019 and December 2025, homeowners' home and mortgage insurance premiums rose 45.0%, passenger vehicle insurance premiums rose 23.9%, and the all-items Consumer Price Index rose 21.0%.
Home insurance premiums therefore rose 24.0 percentage points faster than general inflation over six years. Auto insurance premiums rose 2.9 percentage points faster. Home insurance is where Canadian households have absorbed the larger real increase, and the gap is more than twice the size of the auto gap.
Claims Costs Rose Twice as Fast as Premiums
Set the premium increases against the claims costs behind them and the premium rises look restrained rather than aggressive.
Homeowners' claims expenses rose 2.1 times as fast as homeowners' premiums. Auto claims expenses rose 2.8 times as fast as auto premiums. The two periods differ slightly, since the claims figures are calendar years and the premium indexes run December to December, but the direction is not in question.
Q3 2024 Expenses Rose $3.8 Billion in One Year
In the third quarter of 2024, total claims and expenses for Canadian property and casualty insurers reached $21.4 billion against revenue of $21.6 billion. Expenses were $3.8 billion higher than in the third quarter of 2023 and $4.2 billion higher than the quarter immediately before, a rise of 24.4% in three months.
The margin between revenue and expenses fell to $0.2 billion, or 0.9% of revenue, from 17.3% the quarter before. For many insurers it was the worst quarter on record, and the cause was concentrated in extreme weather events within those three months.
No other quarter in the three-year series comes close. The next weakest, the first quarter of 2023, still ran at 8.6% of revenue.
Claims Fell in 2025 but Premiums Did Not
Catastrophic claims fell 72.1% in 2025. Homeowners' expenses fell 11.4% and auto claims expenses fell 3.9%. Across the full year, insurer expenses rose just 0.9% while revenue rose 3.9%.
The result was the strongest year of the three for insurers, with the gap between revenue and expenses reaching 14.4% of revenue against 11.9% in 2024. The fourth quarter of 2025 was the single best quarter in the series at 17.5%.
Premiums are priced on expected losses over a multi-year horizon rather than on the most recent twelve months, so a single quiet year for catastrophic claims does not reverse a premium increase. For Canadian households the practical consequence is that the premium level set during the 2023 and 2024 claims years stays in place while insurers rebuild capital against the next severe year.
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Frequently Asked Questions
Why are insurance premiums rising in Canada?
Three cost pressures sit behind the increases. Catastrophic weather claims reached $8.6 billion in 2024, 2.4 times the previous six-year high. The Residential Building Construction Price Index rose 69.4% between the fourth quarter of 2019 and the fourth quarter of 2025, which raises the cost of every rebuild. Auto part, maintenance and repair costs rose 22.6%, alongside higher vehicle prices and auto theft.
How much have home insurance premiums gone up in Canada?
Homeowners' home and mortgage insurance premiums rose 45.0% between December 2019 and December 2025, against a 21.0% rise in the all-items Consumer Price Index. That is 24.0 percentage points faster than general inflation over six years.
How much have auto insurance premiums gone up in Canada?
Passenger vehicle insurance premiums rose 23.9% between December 2019 and December 2025, 2.9 percentage points faster than the 21.0% rise in the all-items Consumer Price Index. Auto claims expenses over the same period rose 66.2%.
Are insurers raising premiums faster than their costs?
No, on these figures. Homeowners' claims expenses rose 95.0% between 2020 and 2025 while homeowners' premiums rose 45.0%, and auto claims expenses rose 66.2% while auto premiums rose 23.9%. Claims costs rose roughly twice as fast as premiums in both lines.
What was the worst year for extreme weather claims in Canada?
2024, at $8.6 billion, the costliest on record. It was 152.9% above 2023 and 2.4 times the previous high of $3.6 billion in 2022. Every year from 2020 to 2025 ranks among the ten costliest on record.
If claims fell in 2025, will premiums come down?
Not directly. Catastrophic claims fell 72.1% in 2025 and insurers recorded their strongest year of the three, with the gap between revenue and expenses at 14.4% of revenue. Premiums are priced on expected losses over several years rather than the most recent twelve months, so one quiet year does not reverse an increase.
How bad was the third quarter of 2024 for insurers?
Claims and expenses reached $21.4 billion against revenue of $21.6 billion, leaving a margin of $0.2 billion or 0.9% of revenue. Expenses were $3.8 billion above the same quarter a year earlier and 24.4% above the previous quarter. For many insurers it was the worst quarter on record.
About This Analysis
This analysis was produced by Bridging Local (RC Research & Insights Inc.), a Vancouver-based market research and business consulting firm. We run primary research across B2B and B2C markets, including surveys, in-depth interviews, competitive analysis, local market deep dives and go-to-market strategy.
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