How to Get Home Insurance: A Guide for New Homeowners

TL;DR: How to get home insurance

To get home insurance when closing on a house, you’ll need to: 

1. Gather information about your home’s age, size, construction, and electrical and plumbing systems. 
2. Determine your coverage needs. 
3. Request quotes from 3–5 trusted Canadian insurers. 
4. Review coverage options with a professional. 
5. Complete all paperwork and make your first payment. 

When do you need to buy home insurance?

Home insurance isn’t mandatory in Canada, but you do need to buy it before you can finalize your mortgage and close on a house. To buy a home with a mortgage, you’ll need to:

• Buy home insurance before closing
• List your mortgage lender on the insurance policy
• Send proof of home insurance to your mortgage lender

If you’re not sure exactly what your lender’s requirements are for home insurance, ask your loan officer for details. 

Step-by-step: What you’ll need to do to get home insurance

1. Assemble information about your home and property

This is the first step in the process, and the easiest to complete on your own without guidance from a professional. 

Before you can request home insurance quotes and open a policy, you’ll need to gather a lot of information about the home you wish to insure, even if you don’t officially own it yet. Information needed for a home insurance quote might include: 

• The year the home was built
• Total square footage (including square footage of basement and outdoor areas)
• The year the roof was last replaced
• Type of roofing materials
• Building materials used in the main structure
• Age, type, and condition of all home systems (e.g., HVAC, plumbing, electrical) 
• Information regarding security systems, fire alarms, and more

That means gathering up home listings, inspection reports, and any other documents you’ve acquired throughout the buying process. If you already own the home and haven’t touched these documents in a few years, you might need to go into your files to assemble all the necessary data. 

While you work on that, it’s time to create a home inventory of the personal belongings you want your insurance policy to cover. That includes furniture, appliances, electronics, sports equipment, clothing, jewellery, art, pet supplies, and more. 

Why do you need a home inventory?

A home inventory serves two purposes when getting home insurance. First, it helps you highlight high-value items that might not be covered by standard contents coverage, which is usually set at a percentage of your overall coverage limit. An advisor or broker can help you determine if additional endorsements are needed to cover all your personal property.

Second, a home inventory prepares you to use your home insurance if you ever need to make a claim. Detailed records of the belongings your policy covers can help you and your insurance company reach a quick and fair settlement in the event of a loss.

2. Decide how much insurance to buy 

Your home insurance policy will cover 100% of the cost to rebuild your home. Working with a professional insurance advisor or broker at this stage can help you determine what other coverage needs you have, and how it all fits with your overall finances. They’ll help you answer questions like: 

• Do you need replacement cost coverage or actual cash value (ACV) coverage? 
• Do you have any high-value personal property that requires special coverage? 
• Should your policy cover the maximum number of perils, or only basic perils like fire and hail? 
• How high should your personal liability limit be? Do you need additional liability coverage? 
• Do you need flood insurance? 
• Are add-ons for sewer backup and service line coverage necessary? 

Do you need a home and auto bundle?

A licensed advisor can also help you decide whether to bundle your home and auto insurance policies. Bundling can reduce insurance premiums by as much as 20% (or more!), so it’s smart to consider shopping for both types of personal property insurance at once.

3. Request home insurance quotes from at least 3–5 insurers

Once you know what you’re looking for and have all the necessary documents, it’s time to request personalized quotes that can help you estimate pricing and identify the best coverage options for your home. 

There are three basic ways to request home insurance quotes in Canada: 

For hands-on shoppers with extra time: Get quotes one by one

If you prefer to do things hands-on and have a little time to spare, you can request quotes individually from each insurer. You’ll need to make sure to request quotes for the exact same coverage to make a fair comparison, and the process can be time consuming.

For old-school shoppers who prioritize in-person guidance: Work with a local broker

Insurance brokers work for consumers, not for insurance companies, so they can find quotes and offer recommendations without bias towards any particular insurer. Working with a broker cuts down on paperwork and entitles you to expert advice from an industry insider.

For results-driven shoppers who value expert efficiency: Shop with a digital broker

Digital insurance platforms like PolicyMe combine traditional brokers’ expertise and access to personalized quotes with the efficiency of online shopping. You can fill out applications, customize coverage, and compare results quickly on your phone or laptop, but you’ll still get access to licensed advisors who can help you tailor your policy to your actual needs—or just confirm that you’ve made the right choices.

4. Review and fine-tune your coverage options

Once you’ve collected your quotes, it’s time to take a close look at all of your options. 

Make sure you understand what you’re buying before you proceed. Basic home insurance coverage may seem standardized, but insurance companies offer many ways to customize, extend, and modify your coverage. 

All home insurance policies include several basic components, including: 

• Dwelling coverage for your home’s main structure
• Other structures coverage for detached sheds, fences, and other structures
• Contents coverage for your personal belongings such as clothes and furniture 
• Additional living expenses coverage for hotel rooms, meal delivery, and other costs if you’re unable to stay in your home due to a covered loss
• Personal liability insurance to cover your legal responsibility if you’re found at fault for bodily injury or property damage to others

On top of these standard types of coverage, you may have the option to add endorsements like sewer backup coverage, additional coverage for high-value personal property, overland flood insurance, identity theft protection, and more. 

In addition to endorsements and add-ons, you can customize your coverage by: 

• Setting your dwelling coverage and liability limits
• Adjusting your deductible—a higher deductible means lower rates, but will cost you more in the event of a claim
• Choosing between a policy that covers your property’s full replacement cost and one that only covers its actual cash value (ACV) minus depreciation

5. Make a payment and complete the paperwork

You can finalize your policy and activate your homeowners insurance by signing your insurance contract, making your first premium payment, and sending the proof of insurance to your mortgage lender. 

If you make your first year’s payment in full, you may be eligible for a discount on your policy. You can also get a discounted rate if you buy home insurance from a company you’ve already bought one insurance product from, such as auto insurance. 

What you’ll need to get home insurance

To get home insurance quotes, you’ll need a lot of information and documentation about yourself, the home, and your insurance claims history. This information helps insurance companies estimate the overall risk your policy presents. 

How insurers determine home insurance pricing

Insurance companies base home insurance premiums on risk. To estimate your risk of filing a home insurance claim and the potential severity (or cost) of that claim, they’ll plug all the information you provided into their underwriting algorithms. 

Home insurers’ underwriting teams will take into account: 

• Fire risk: How significant is the fire risk in your area, and how close is your home to the nearest fire hydrant and fire station? 
• Theft and vandalism risk: What do property crime rates look like in your postal code? Do you have an alarm system in place? 
• Severe weather risk: Do historical weather data show a pattern of severe windstorms, blizzards, and other covered natural disasters in your region? 
• Personal risk: Do you have a history of multiple insurance claims? 
• Claim severity risk: How much is your dwelling coverage limit? What additional coverage options have you selected? 

Large, expensive homes in areas subject to significant climate or crime risks carry the highest home insurance costs, while claims-free homeowners with smaller homes in safer areas may pay lower insurance rates. 

4 tips for choosing the right home insurance policy

It’s easier than you think to buy a home insurance policy that doesn’t serve your needs. Here’s how to make sure you’re properly covered.

1. If possible, work with a broker. The Insurance Bureau of Canada (IBC) advises homeowners—including first-time homeowners—to work with a professional broker or advisor to make sure they understand their coverage and can make informed decisions about limits, deductibles, exclusions, endorsements, and more. 
2. Always compare multiple insurers. While it might be tempting to go with the first quote that sounds affordable, especially if you’re wrapping up a lengthy home-buying process, it’s worth your time to compare offerings from multiple insurers. 
3. Don’t just look at the price. Affordability is a major priority for most homeowners buying insurance, and that’s understandable. But equally important is your insurer’s ability to communicate clearly, handle claims efficiently and fairly, and back your home with financial stability. 
4. Ask questions before you finalize your policy. Not sure what your home insurance covers and what it doesn’t? Ask your agent or advisor. Confused about how claims will work under your new policy? Ask that, too. You should feel confident about what your policy offers and where your coverage ends before you sign on the dotted line. 

FAQ: How to get home insurance

This article is for general information only and is not insurance or legal advice. Examples and any sample quotes or rate ranges are illustrative and do not constitute an offer or guarantee of coverage, price, or eligibility. Actual coverage, discounts, and premiums depend on your individual circumstances and the insurer provider; if there is any discrepancy, your policy and insurer documentation govern. For advice about your situation, speak with one of our licensed insurance professionals.