Updated for 2026

Understand Every Type of Insurance in Canada — Simply & Clearly

Learn how insurance works, compare options, avoid common mistakes, and choose what's right for you.

Explore Insurance Types

Click any card to jump to its deep-dive guide below.

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Car Insurance in Canada

Mandatory in every province & territory

What is it & why is it required?

Car insurance is legally required in every Canadian province. It protects you financially if you cause an accident, injure someone, or damage property. Driving without insurance can result in fines of $5,000 to $50,000+, vehicle seizure, and even jail time.

Mandatory vs. Optional Coverage

Coverage Type Required? What It Covers
Third-Party Liability✓ YesDamage/injury you cause to others
Accident Benefits✓ YesMedical costs & income loss for you
Uninsured Motorist✓ YesIf hit by an uninsured driver
CollisionOptionalDamage to YOUR car in an accident
ComprehensiveOptionalTheft, fire, vandalism, weather

check_circle You NEED this if:

  • • You own or lease a vehicle
  • • You drive a company car
  • • You borrow someone else's car regularly

cancel You may NOT need this if:

  • • You don't own a car and never drive
  • • You only use public transit or cycling

Frequently Asked Questions

Your premium is based on: age, driving record (tickets, accidents), postal code (urban = higher), vehicle type (sports car vs. sedan), annual mileage, deductible amount, and your credit score (in some provinces).

1) Increase your deductible. 2) Bundle home + auto. 3) Install winter tires (5% discount in many provinces). 4) Take a defensive driving course. 5) Ask about group discounts through your employer or alumni association. 6) Shop around — rates vary dramatically between providers.

home

Home Insurance in Canada

Not legally required, but your mortgage lender will demand it

Home insurance protects your dwelling (the physical structure), your personal belongings inside it, and your personal liability if someone gets injured on your property. While not legally mandatory, virtually every mortgage lender in Canada requires it.

Policy Type Best For Typical Cost
ComprehensiveHomeowners (covers all risks except exclusions)$800–$2,500/yr
BroadCoverage + named perils for contents$600–$1,800/yr
Basic (Named Perils)Budget option, only named risks covered$400–$1,200/yr
Tenant / Renter'sRenters — covers YOUR stuff + liability$15–$40/mo
CondoCondo owners — covers unit improvements$25–$50/mo

warning Common Mistake

Most Canadians are underinsured for water damage. Standard policies often exclude overland flooding and sewer backup. Always add these riders — they cost ~$50-$150/year but can save you $50,000+ in repairs.

health_and_safety

Health Insurance in Canada

Provincial healthcare is good — but it doesn't cover everything

Canada's public healthcare covers hospital stays and doctor visits, but it does NOT cover dental, vision, prescriptions, physiotherapy, mental health counselling, or ambulance rides (in most provinces). Supplemental health insurance fills these gaps.

What Provincial Healthcare Does NOT Cover

🦷 Dental
👓 Vision / Eye Care
💊 Prescriptions
🧠 Mental Health
🏃 Physiotherapy
🚑 Ambulance ($45-$850)

check_circle You SHOULD get this if:

  • • Your employer doesn't provide benefits
  • • You're self-employed or freelancing
  • • You have kids who need dental/ortho
  • • You take prescription medications

info You may already have this if:

  • • Your employer has a group benefits plan
  • • Your spouse's plan covers you
  • • You're a student at a university (plan included)
favorite

Life Insurance in Canada

A tax-free payout to protect your family's future

Life insurance pays a tax-free lump sum to your beneficiaries when you die. It's designed to replace your income, pay off debts (like a mortgage), and cover future expenses like your children's education.

Type Duration Cost (30yo, $500k) Best For
Term 2020 years~$25/moYoung families, mortgage coverage
Term 1010 years~$18/moShort-term needs, budget
Whole LifeLifetime~$200+/moEstate planning, wealth transfer
UniversalFlexible~$150+/moInvestment component, tax shelter

💡 Pro Tip: The 10x Rule

A common rule of thumb: get coverage equal to 10 times your annual income. If you earn $80,000/year, aim for $800,000 in coverage. This ensures your family can maintain their lifestyle for years.

business_center

Business Insurance in Canada

For freelancers, small businesses & corporations

Even if you're a solo freelancer, one lawsuit from a client can bankrupt you. Business insurance protects your company's finances, reputation, and future. Many clients and contracts require proof of insurance before working with you.

General Liability

Covers third-party bodily injury and property damage. The #1 policy every business needs.

~$300–$1,500/yr for small biz

Professional Liability (E&O)

Covers claims of negligence or mistakes in your professional services.

Essential for consultants & IT

Cyber Liability

Covers data breaches, hacking, and ransomware attacks on your business.

Growing fast — highly recommended

Commercial Property

Covers your office, equipment, inventory, and signage against damage or theft.

For businesses with physical assets

flight

Travel Insurance in Canada

Your provincial health card is nearly useless outside Canada

emergency Real Cost Without Insurance

A broken leg in the US can cost $50,000–$150,000 in hospital bills. An air ambulance back to Canada costs $25,000+. Your provincial health plan covers almost nothing outside Canada.

local_hospital

Emergency Medical

Hospital, surgery, prescriptions abroad

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Trip Cancellation

Refunds if you can't travel

luggage

Baggage & Delay

Lost bags, delayed flights

warning Common Insurance Mistakes Canadians Make

1. Only comparing price

The cheapest policy often has the worst coverage. Always compare what's included, not just the premium.

2. Not reading exclusions

Every policy has exclusions. The most common surprise: water damage, earthquakes, and "acts of God" are often NOT covered.

3. Underinsuring your home

If your home is insured for $300k but costs $500k to rebuild, you'll only get partial payout. Update your coverage annually.

4. Skipping travel insurance

A single emergency abroad can cost more than your entire vacation. Travel insurance is $2-5/day — always worth it.

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