850,000 Canadian homes can't get flood insurance — and now a major bank is refusing mortgages in the riskiest zones

For homeowners, that shift creates two distinct problems: bBgger premiums for almost everyone, and, for a growing number of Canadians in high-risk zones, the real possibility of losing coverage — or a mortgage — altogether.

Why home insurance premiums keep climbing

Home insurance costs have outpaced inflation across Canada for several years running, and the increases are not spread evenly. In Alberta, premiums have jumped more than 390% over the past 20 years — the steepest rise of any province — according to a Statistics Canada report cited by BNN Bloomberg.

Flooding, meanwhile, has become the leading cause of insured losses nationally: It caused more than $4 billion in damage in 2024 and over $1 billion in 2025, according to IBC figures.

Why coverage is disappearing in some areas

For a certain percentage of the Canadian population, the problem isn’t the price of insurance — it’s getting any at all. Roughly 6% of the Canadian housing market, or about 850,000 homes, cannot obtain flood coverage because the risk is considered too high, Kathryn Bakos of the Intact Centre on Climate Adaptation at the University of Waterloo, told BNN Bloomberg. She also sounded the alarm on how Canada needs to become “a more proactive society, rather than a reactive society,” further arguing that risk needs to be reduced before disasters happen, not managed after the fact.

The fallout is starting to reach mortgages, too. Some lenders, Bakos notes, including Desjardins Financial, have stopped issuing mortgages in specific high-risk flood zones in Quebec, where annual flood risk exceeds 5%. That means some homeowners and buyers may soon face fewer financing options, not just higher insurance bills.

What’s being done about it

Insurers say the country isn’t a lost cause. The IBC notes Canada remains broadly insurable, and it’s continuing to work with the federal government on a possible national flood insurance program aimed at households that can’t get coverage through the private market. That program is still in the technical design stage, with no confirmed launch date — so homeowners in high-risk areas should plan as though it isn’t arriving soon.

What Canadian homeowners can do now

A few practical steps can lower your risk and, in some cases, your premium:

• Check your flood and wildfire risk before you buy or renew — municipal flood maps and the free WeatherCan app can flag exposure you might not know about
• Ask your insurer about discounts for installing a backwater valve or sump pump, which reduce flood risk
• Clear debris from outdoor drains, which is a common, low-cost cause of preventable flood damage
• Compare quotes at every renewal, since premiums are rising unevenly by region
• Confirm financing early if you’re buying in a flood-prone area, since some lenders are pulling back in specific zones

Climate-driven weather isn’t going away, and neither is its effect on what Canadians pay to protect their homes. The real risk for homeowners isn’t a bigger bill — it’s assuming their address is exempt from either problem. Checking your hazard exposure, asking pointed questions at renewal and acting on the low-cost fixes now is cheaper than finding out at claim time, or at your next mortgage renewal, that your home has quietly become harder to insure.