Wildfires are increasingly influencing the financial side of owning a home in Canada. As these events become more common, they drive up insurance premiums, making housing less affordable in certain areas. This article explores how wildfire risks are reshaping monthly costs for homeowners, based on recent data from insurance and real estate analyses.

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Key Insights from Recent Studies

A detailed review of insurance quotes and housing data reveals that in high-risk wildfire areas, home insurance premiums can now represent a significant portion of monthly mortgage payments. For instance, in Medicine Hat, Alberta, these premiums account for 19% of a typical mortgage. Similarly, in Wood Buffalo, which includes Fort McMurray, the figure stands at 16%. These percentages highlight how insurance is evolving from a minor expense to a major factor in overall housing budgets.

The study, which examined thousands of real insurance quotes from early 2025 alongside home value estimates, shows premiums rising faster than property prices in vulnerable spots. Nationally, insurance makes up about 2% of mortgage payments, but this average hides the stark differences in wildfire-prone regions. Over the past two years, some areas have seen premiums increase by up to 98%, as in Kamloops, British Columbia, where annual costs jumped from around $1,893 to $3,743.

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Regions Feeling the Strongest Effects

Certain provinces face more intense pressures due to their exposure to wildfires. Alberta and British Columbia top the list, with multiple cities where insurance now equals 10% or more of monthly mortgages. In Prince George, British Columbia, and Timmins, Ontario, this ratio has climbed notably, reflecting higher risks and claims.

For example, Kelowna, British Columbia, experienced a 52% premium hike between 2023 and 2025, pushing the insurance share of mortgages from 4% to 7%. In Alberta, Medicine Hat's premiums rose by 24% to $3,875 annually, making it one of the hardest-hit areas. Northern Ontario cities like Kenora and Sudbury also saw above-average increases, tied to growing wildfire threats. These trends stem from actual claims data and standardized profiles, including factors like home size and safety features. While high property values in places like Vancouver keep ratios lower, smaller communities bear a heavier burden.

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Broader Implications for Buyers and Owners

Climate risks are turning insurance into a core part of homeownership expenses. As premiums outpace home value growth, affordability suffers, especially for first-time buyers. In markets where insurance reaches 15% to 20% of mortgage costs, some may reconsider purchasing in high-risk zones. This shift could influence where people choose to live, favoring areas with lower disaster exposure. Nationally, while premiums increased by 12% over two years, the impact is most acute locally. Experts note that without measures like better forest management or resilient building practices, these costs may continue to climb.

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Steps Homeowners Can Take

To manage rising premiums, consider bundling policies or installing safety features like monitored alarms for potential discounts. Reviewing coverage to match your specific risks, such as adding protections for water damage, can also help. Shopping around for quotes ensures you're getting competitive rates without overpaying.

At Coldwell Banker Horizon Realty, we understand how factors like wildfire risks affect your housing decisions. Our team provides tailored advice to help you find properties that balance affordability and location. Contact us today to discuss your options and explore homes that fit your needs in today's market.