Is Home Insurance Required in Ontario? What Buyers Should Know
By Françoise Pollard & Keith Goldson · Keith & Françoise Real Estate Team, eXp Realty · GTA & Niagara Region
Many buyers don’t think about home insurance until a few days before closing. That’s a mistake. We’ve seen deals delayed because buyers couldn’t get coverage on an older home. Here is the part that surprises people: home insurance in Ontario is not required by provincial law. It is required by your mortgage lender, and no lender will fund your purchase without it.
So the honest answer is simple. Your lender, not the government, is the one insisting. For most buyers that does not change much, since almost everyone closing in the GTA carries a mortgage. Still, the details below can save you money and headaches.
The short version
Home insurance in Ontario is not mandated by provincial law. Your mortgage lender requires it as a condition of the loan, and you need proof of coverage before closing. If you own outright, it is not legally required, but skipping it is a real risk. Older homes, plus a few lesser-known traps like force-placed coverage and vacancy gaps, are worth knowing before you buy.
Is Home Insurance Legally Required in Ontario?
No. There is no law requiring home insurance in Ontario. The Financial Services Regulatory Authority of Ontario (FSRA) regulates the insurers that sell it, but it does not make you buy a policy. Auto insurance is required by law here, so people assume home insurance works the same way. It does not. The requirement you hit as a buyer comes from your mortgage lender.
Why Your Mortgage Lender Requires It
Your lender requires home insurance to protect the home they are lending against, which is their collateral. In practice, that means proof of insurance before your deal closes. Your lender will ask for a certificate that names them on the policy. No certificate, no funding, no keys. So line this up early, alongside your mortgage pre-approval. That is why home insurance in Ontario is effectively required for anyone with a mortgage.
Why Insuring an Older Home Is Harder
Age is the usual reason a home is hard to insure. Insuring an older home with knob and tube wiring, aluminum wiring, or a 60-amp service can be difficult, and some insurers decline these homes outright. Others require an electrical inspection or rewiring first, or charge much higher premiums. This matters most on century and mid-century homes, which the GTA and Niagara have plenty of, from older Toronto neighbourhoods to Hamilton and St Catharines. Before you make an offer on an older home, ask your Realtor® about the electrical system, plumbing, roof, and heating. Those details can affect both your insurance options and your premiums. Insuring an older home is doable, but find out what you are buying before you commit.
Three Insurance Surprises Buyers Don’t See Coming
Force-Placed Insurance
If your policy lapses while you still have a mortgage, your lender will not just send a reminder. They can buy a policy on your behalf and add the cost to your mortgage. That coverage is usually far pricier than a normal policy, and it protects the lender’s interest, not your belongings.
Your Claims History Follows You
In Canada, insurers share claims data, so your record follows you from one company to the next. It can even follow you to a new home. A couple of recent claims can raise your premium or, in a tight market, get you declined. A property’s past claims matter too, so ask the seller about any water damage before you buy.
Vacancy and Renovation Gaps
Leave a home empty for more than about 30 days, and a standard policy can change. It often suspends coverage for theft, vandalism, and water damage. This trips up buyers who close before they move in, or who plan a gut renovation. The fix is to tell your insurer and add a vacancy permit, or for major work, a builder’s risk policy. Every insurer has its own vacancy rules, so check your policy before assuming you are covered.
Keith & Françoise
What we’ve seen
Over the years, we have watched more than one deal nearly fall apart over insurance. A buyer falls for a charming older home, then learns the wiring makes it tough to insure. So when a property looks hard to insure, we build a condition into the offer. It lets the buyer confirm coverage first and back out cleanly if they cannot get it. That one clause has saved our clients real money and worry.
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Common Questions About Home Insurance in Ontario
Is home insurance required by law in Ontario?
No. There is no law requiring home insurance in Ontario. If you have a mortgage, your lender requires it as a condition of the loan, but that obligation comes from the lender, not the province.
Can you get a mortgage in Ontario without home insurance?
No. Ontario lenders require proof of active home insurance before they release funds, and the policy must name the lender. Without that proof, your purchase will not close.
Why are older homes harder to insure in Ontario?
Older homes often have knob and tube wiring, aluminum wiring, or 60-amp service, which insurers treat as fire risks. Some decline these homes, while others require an inspection or rewiring, or charge higher premiums.
What is force-placed insurance?
Force-placed insurance is coverage your mortgage lender buys on your behalf if your own policy lapses. The lender adds the cost to your mortgage. It usually costs more than a standard policy and protects the lender, not your belongings.
Does leaving a home vacant affect your insurance in Ontario?
Yes. Most standard Ontario policies limit or suspend coverage once a home is vacant for more than about 30 days, including for theft, vandalism, and water damage. If you will leave a home empty between closing and move-in, or during a renovation, tell your insurer and add a vacancy permit or builder’s risk coverage.
Buying a home in the GTA or Niagara?
We help buyers spot issues like insurance trouble before they turn into a problem at closing. Let’s talk about your purchase.
Talk to Us About BuyingKeith & Françoise Real Estate Team
eXp Realty Brokerage · GTA & Niagara Region
Françoise Pollard, Realtor®, and Keith Goldson, Broker, lead the Keith & Françoise Real Estate Team at eXp Realty Brokerage. Françoise has been a Realtor® since 2006, and Keith has been a Broker since 2016. They help buyers across the GTA and Niagara Region, including Brampton, Mississauga, Toronto, Vaughan, Oakville, Burlington, St Catharines, and Niagara Falls. Their focus is the details that protect a purchase, from financing to insurance.
This post is for general information only and is not insurance, legal, or financial advice. Home insurance rules and coverage vary by property and provider, so confirm the details with a licensed insurance professional before you act. You can learn more about your rights from the Financial Services Regulatory Authority of Ontario. Françoise Pollard is a Realtor® and Keith Goldson is a Broker with the Keith & Françoise Real Estate Team, eXp Realty Brokerage, serving the GTA and Niagara Region.
