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The Dangers of Homes Without Home Insurance

home the home insurance people
Buying a home — especially for the first time — is one of the most significant, most valuable purchases you will ever make. While insurance can’t guarantee that your home will never be damaged, a home insurance policy can ensure that you are financially protected if damage does occur.

But what are the risks of owning a home without homeowners insurance? Are they worth the cost savings? Let’s break it down:

New Homeowners Insurance

If you’re buying (or selling!) your first-ever home, be aware that many Real Estate Contracts require “Insurability” — in other words, your property is eligible for insurance coverage.

While you aren’t legally obligated to have home insurance when purchasing a house in Canada, many financial and real estate institutions will require insurance if you want to access their home-related services.

For example, if you need to take out a mortgage on your home, the mortgage lender will require evidence of home insurance. If you don’t have home insurance coverage, the lender may declare you in default, and you could face foreclosure.

What Does Home Insurance Cover?

A Homeowners Insurance Policy is divided into several parts to protect different aspects of your property, including:

  • Property Coverage,
  • Contents Coverage,
  • Liability Coverage,
  • Additional Living Expenses and, optionally,
  • Additional Comprehensive Coverage.

So, What Are the Risks of Not Having Home Insurance?

  1. No liability protection.
    Liability coverage protects you from being sued if someone is hurt or injures themselves on your property. Without liability protection, you would be financially on the hook for any lawsuit fees and settlements brought against you by any party. A homeowners insurance policy covers your premises for liability and your acts worldwide.
  2. No financial protection against disasters.
    No matter how careful we are or how well we care for our homes, disasters can still happen. Whether it’s an earthquake, wildfire, or burglary, unexpected disasters can leave you with a financial blow you’re unprepared for and can’t afford to pay out of pocket. Homeowners insurance helps you recover from damage to expensive structural systems like roofs, septic tanks, and lost personal items.
  3. No protection if your house becomes unlivable.
    If your house is severely damaged, can you afford to live elsewhere while repairs occur? Home insurance policies cover cost-of-living expenses like staying in a hotel while your house is stuck without heating, water, or electricity. This can make a huge difference in getting back on your feet after a disaster.
  4. Not being able to sell your home.
    If you ever need or want to sell your home, you may not be able to do so without home insurance. A lack of home insurance often makes properties undesirable to potential buyers, and some Realtors won’t show homes without insurance at all. This can lead to your house spending much more time on the market and selling for a much lower price than if you had insurance.
  5. It will cost more to get home insurance later.
    Houses that go a long time without home insurance are considered a higher risk, resulting in a higher premium if you decide to get insurance later. If you already have home insurance and choose to let it lapse, you’ll also lose any continuation of insurance coverage discounts. This can result in a much more expensive home insurance policy than if you bought one upon acquiring your property.


In the end, the monthly expense of protection for your most significant and vulnerable assets is much smaller than the potentially life-altering costs you could face in the event of a disaster. Is it worth the risk?

Looking for Home Insurance That Fits Your Needs?

At Harbord The Home Insurance People, our Brokers are expertly trained to find the best fit for your needs and budget. Call our brokers at 1.844.544.4663, or get a home insurance quote online. We look forward to speaking with you!

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