Flood insurance in Canada

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Home insurance water damage coverage - a basic overview

If you're unsure of how your home insurance protects you from water and the many ways it could damage your home, you're putting yourself at risk. Water is the #1 cause of property damage and, for those who can claim it, it’s now the costliest claim in Canada. Are you properly protected? There are 3 types of home insurance policies offered in Canada - basic, broad, and comprehensive.

Most Canadians choose a comprehensive home insurance policy because the pricing difference between all 3 policies is minimal, so why not get the best? Comprehensive insurance covers the home and its contents from a number of risks, except for: earthquakes, war, and, you guessed it flood damage. It typically will cover your home against water damage from a burst pipe. A burst pipe is the result of pressure build-up in your water supply line due to temperature fluctuations and ageing. But, there are several other examples of water damage beyond a burst pipe and to ensure you are covered for all potential instances requires the addition of water damage and flood insurance endorsements to your policy.

Coverage Description
Basic coverage

A basic policy only covers "specified perils." For example, you can buy insurance for a specific event like a lightning strike. But if your home is vandalized, you have no coverage. It makes it the cheapest, albeit the riskiest form of home insurance.

Broad coverage

Broad insurance covers the structure of your home, but not its contents (unless you've named them as a peril). For example, if you drop your TV while moving it and it scratches the floor; the floor is covered, but not the TV.
Comprehensive coverage

The most inclusive policy covering the building and its contents from all risks, except for some optional coverages such as: sewer back-up, earthquakes, or overland water.

Types of water damage and flood insurance endorsements

A flood can occur from multiple sources, not just a burst pipe. Heavy rains can cause a city's main drains to backup and flow into your basement. Overflowing rivers and ponds could cause a swell of groundwater that flows into your home. Heavy snow melt can leak through your foundation causing severe damage. Here are flood insurance options you may wwant to consider in your given situation.

Flood insurance add-ons to your home insurance policy:

You can read more about sewer backup or overland water on our blog.

How home insurance companies deal with flood insurance

Most home insurance policies in Canada don't protect you from floods arising from anything other than a burst pipe. However, with the increase in flooding and their intensity, we do see some home insurers adapt. Here is a list of insurance companies and the water protection they offer, either as a standard or an optional endorsement.

See the chart below for more details on available flood insurance coverage:

Company Base Add-on
Allstate insurance company of Canada

Coverage for burst pipes, leaking appliances, storm waters, spring thaw, accumulated rain, and other types of freshwater flooding with limitations

Limited sewer backup: for damage caused by the escape of water from a sewer, drains, sump pit or septic pump

Enhanced water damage: including sewer backup, water overflow from freshwater, heavy rain, or groundwater

For QC residents: Groundwater, sewer water, and overflow of a body of water

*Available in Alberta, New Brunswick, Nova Scotia, and Ontario

AMA Insurance

Burst pipes, leaky appliances, wind & hail damage

Enhanced Water Endorsement: includes water damage resulting from certain types of sewer backup, surface water and torrential rain.

Enhanced water damage: including sewer backup, water overflow from freshwater, heavy rain, or groundwater

For residents of Alberta

Aviva Canada

Burst pipes

Sewer backup endorsement: Available across Canada

Overland Water endorsement: For Alberta and Ontario residents that have purchased Sewer Backup

BCAA Insurance

Burst pipes

Sewer backup endorsement

Flood rider: (freshwater and heavy rain or snowmelt)
For BC residents

CAA Insurance

Burst pipes

Enhanced water endorsement: Protects against water entering the home from entry points like window and doors

*For Ontario residents

Commonwealth Mutual

Burst pipes

Water Plus endorsement: Includes flood and sewer backup coverage based on the level of risk

*For Ontario residents

The Co-operators

Burst pipes

Extended Water: Covering sewer backup and overflow of outside drains or sewers. Available across Canada.

Comprehensive Water endorsement: Sewer backup and Overland water
*For Alberta and Ontario residents

Desjardins General Insurance

Burst pipes

Ground water & sewer backup: Depending on risk level, you may need to pay for this protection, sometimes it comes standard.

Gore Mutual

Burst pipes

Sewer Backup
WaterEscape Plus (overland water + sewer backup)

*For Ontario residents

The Guarantee Company of North America

Burst pipes & sewer backup

H20+ covers damage from freshwater flooding, groundwater, and surface water

Intact Inusrance

Burst pipes

Enhanced Water Damage: Sewer Backup, septic system failure, sump pump or drain failure
Overland Water: Sewer backup and overland water
Ground water coverage: (only if you have overland water) covers against sudden water through the foundation from underground water sources

Optimum General

Burst pipes

Sewer Backup
Overland water: For BC and Ontario only

Pembridge Insurance

Burst pipes

Sewer Backup
Overland water:

The Personal Insurance

Burst pipes

Ground Water
Sewer Backup
Overland water May be included in base policy depending on risk

RSA Insurance

Burst pipes, leaking appliances

Waterproof coverage Storm and flooding activity not related to saltwater, tsunami, or coastal flood

State Farm Canada

Burst pipes

Ground Water
Sewer Backup
Overland water

Unica Insurance

Burst pipes

WATERtight Overland water and sewer backup

Canada Flooding Protection - How the Disaster Financial Assistance Arrangement program works

Since 1970, provinces and territories have worked with the federal government to provide some financial assistance to those without flood insurance. The federal government only steps in if the costs far exceed what the province or territory can cover on their own.

Each province and territory has its limits, laws, and regulations on how the money is given out. Generally, the programs only offer assistance for the essentials and only if you couldn't have insured it in the first place. Residents receive financial compensation, but must manage the restoration process themselves before submitting a claim. Most Canadians still want a better flood assistance program, especially after the 2013 floods in Alberta and Ontario.

Below, we give a high level overview of each province and territory's financial assistance plan for when disaster strikes:

Water damage prevention tips

A report from the Centre for Research on the Epidemiology of Disasters (CRED) states that the cost of natural disasters rose 14-fold since the 1950’s. Insurance can help pay to cover some of the damage, but the displacement from our homes, the claims processes, and the tragedy will live on forever in our minds. In an ideal world, you’d never submit an insurance claim. Prevention becomes key. With that in mind, we’ve created a flood prevention checklist, for both indoor and outdoor, below.

Water damage prevention inside your home

  • Try not to use your basement to store valuable items that could be damaged due to flood.
  • If you have no to store those items elsewhere, try to put them up on shelving and in watertight containers.
  • Perform a regular (annual) inspection of the plumbing pipes you can see. Check for any corrosion on copper piping (that would appear white or green) as well as leaks by feeling the pipe itself. If you live in a condo, make sure these checks are performed regularly and are on the maintenance calendar.
  • Do not pour used oil or grease down drains because once they solidify, they can create a backup.
  • Find out where your main water shut off is located. In an emergency, knowing how to shut off the water is essential in keeping damage to a minimum.
  • Install leak detectors, and smart water valves that can remotely power down your main water shut off should a leak be detected.
  • Install a backflow preventer.
  • Install weeping tile and a sump pump.

Water damage prevention outisde your home

  • Make sure all your eavestroughs are in good working order and that the connected downspouts slope away from the foundation (ideally at least 3 feet).
  • If you can't, make sure to use rain barrels to collect overflow water, or build a garden or a french drain to collect the water, preventing it from pooling around the foundation.
  • Do not allow snow to accumulate around your foundation. Clear it away immediately from the perimeter, window wells, and entryways.
  • Use concrete, mortar, and weather stripping to create a watertight seal wherever water could enter into the building — checking the caulking around all your windows. Water can drip in through a tiny hole of a top floor window and leak down to the main floor, making it hard to know the origin of the water.
  • The floor drains just outside your basement entryway, near your foundation, or on the road should be kept clear of leaves and other debris. They must be clear so the water can properly escape.
  • Basement windows should have window wells that ideally drain into a weeping tile to avoid water breaking through the window from pressure. The well should be kept clear of leaves and other debris.
  • Ensure that grading around the foundation slopes away from the foundation or ensure it flows into a clean floor drain.
  • Keep weeping tiles clear and in good repair.
  • Ask the city to inspect the main drains for roots if you live in an area with mature trees
  • Consider permeable solutions like interlock brick, instead of dense concrete.

A history of flooding events in Canada

Inland floods can happen anywhere in Canada, and their frequency is increasing due to climate change and a general loss of green space. Green space absorbs and dissipates water much better than concrete. Major urban centres with lots of concrete and asphalt need advanced sewer systems to handle all the water. Without it, or if it's not working correctly, we can have significant flooding.

See the chart below for more details on available flood insurance coverage:

Year Location Cost
1909 Chester, New Brunswick $149 million
1916 Central Ontario $161 million
1920 Southwestern Ontario $132 million
1920 Prince George, British Columbia $131 million
1923 St. John, New Brunswick $463 million
1934 Plaster Rock, New Brunswick $198 million
1936 New Brunswick $188 million
1937 Southern Ontario $470 million
1948 Fraser River, British Columbia $5,172 million
1948 Southern Ontario $706 million
1950 Winnipeg, Manitoba $4,652 million
1954 Southern Ontario $5,392 million
1955 Saskatchewan and Manitoba $362 million
1961 St. John, New Brunswick $148 million
1972 Richelieu River, Quebec $124 million
1974 Maniwaki, QUebec $103 million
1983 Newfoundland & Labrador $115 million
1987 Montreal, Quebec $147 million
1993 Winnipeg, Manitoba $618 million
1995 Southern Alberta $285 million
1996 Montreal, Quebec $145 million
1997 Southern Manitoba $1,230 million
1999 Melita, Manitoba $163 million
2004 Edmonton, Alberta $303 million
2004 Peterborough, Ontario $129 million
2005 Southern Ontario $1,587 million
2005 High River, Alberta $1,519 million
2007 Sasktachewan $138 million
2008 St. John, Newfoundland and Labrador $12 million
2009 Red River, Manitoba $1,000 million
2010 Southern Alberta and Saskatchewan $956 million
2010 Newfoundland $82 million
2011 Assiniboine River, Manitoba $1,000 million
2012 Ontario and Quebec $350 million
2013 Calgary, Alberta $5,000 million
2017 Quebec $573 million**

*Data Sourced from Square One

**numbers still not finalized at time of publication

It didn't stop in 2013. Ottawa, Toronto, St. John, and large areas in Quebec had major flooding in 2017. Quebec alone set up a $350 million dollar fund to help 5,000 homeowners. The Insurance Bureau of Canada (IBC) reports Quebec and Ottawa flood costs added up to $223 million in insured losses.

Insurance Bureau of Canada’s (IBC) Insurers used to pay $500 million annually across the country in severe weather losses. Now they’re seeing an annual average of about a billion dollars. In 2018, the insurance industry paid out almost 2 billion in severe weather losses across the country.

Frequently asked questions about flood insurance

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