Higher costs are taking a toll on Canadians, with many considering cutting back on or skipping insurance plans, a new survey from TD Bank released Tuesday shows.
One-third of Canadians (33 per cent) say they would consider reducing their insurance coverage to save money, the TD Insurance survey says.
The high cost of everything else causing a strain on their budgets is the reason, said Kristen Gill, vice-president of general insurance at TD Insurance.
“With the cost of everyday essentials continuing to rise, it’s understandable that Canadians are taking a closer look at their household expenses,” Gill said.
“When budgets are stretched, it’s natural to look for places to save,” she added.
Affordability pressures are mounting. More than half (56 per cent) said they are worried that one unexpected expense could force them to make difficult financial choices, while a little more than seven in 10 (71 per cent) say just one surprise expense could undo months of progress toward their savings goals.
The insurance gap is sharper among younger Canadians, with more than half (55 per cent) of Gen Z respondents saying they are likely to cut back on insurance to reduce pressure on budgets.
Among Gen Z respondents, around 58 per cent said they have insurance plans but are putting off reviewing them, while another 44 per cent said insurance was too “confusing” to navigate.
“Young Canadians are choosing between costs they’re incurring this month and a risk that feels years away,” said Andrew Ostro, CEO and co-founder of PolicyMe.
“When rent, groceries, transportation and debt take a larger share of every paycheque, insurance is the easiest thing to defer, especially before there is a mortgage, a child or a partner depending on that income,” he added.
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Getting your insurance plans when you’re young is a good way to “lock in affordable coverage while you’re young, protect co-signers on your loans, or give your family financial protection if something unexpected happens,” said Andrea Frossard, chief commercial officer at Foresters Financial.
“If you become unable to work due to illness or injury, disability or critical illness coverage can help replace lost income. Without it, savings can disappear fast,” she added.
Confusion around insurance isn’t just something young people grapple with, as 84 per cent of all respondents said they don’t fully understand what their insurance does and doesn’t cover.
More than six in 10 (62 per cent) said they aren’t confident their coverage would fully protect them in an unexpected situation.
Skipping insurance can be risky, Gill said, adding that it not only protects what you own today but also helps you prepare for the unexpected.
“Without the right coverage, an unexpected event could mean dipping into savings that were set aside for other goals. Reviewing your coverage regularly and asking questions can help ensure your protection reflects your current needs and gives you greater confidence in the coverage you have,” she said.
The consequences could be more dire for homeowners, said Brett Weltman, spokesperson for the Insurance Bureau of Canada.
“No insurance could mean you could lose the financing on your home,” Weltman said.
“Having no insurance would mean the property owner will be financially responsible for all damage costs from a peril,” he said, adding that this could be anything from hail damage to your roof or getting sued if someone gets injured on your property.
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How to keep insurance costs low
Insurance costs in Canada have been on the rise. According to Statistics Canada, Canadian homeowners paid 3.9 per cent more in June for home and mortgage insurance compared with the same time a year ago.
“In some provinces, especially Alberta and parts of Atlantic Canada, increases were even steeper, with some homeowners seeing double-digit jumps,” Frossard said.
The simplest way to keep your insurance costs low is to shop around, the Insurance Bureau of Canada says on its website.
“Ask about discounts and bundle your policies. If you own a car, get a home insurance quote from your car insurance provider. Companies often offer discounts when you ‘bundle’ your home and car insurance together,” it says.
Consider paying your premium annually, so you can save money by avoiding potential service or interest charges by paying your premium in installments, the website adds.
It can also help to reflect on what insurance you don’t need, Ostro said.
“Life insurance is not a universal product. It exists to protect people who depend on your income, so the first question is whether anyone does,” he added.
“If no one relies on what you earn and you carry no debt that would land on someone else, the honest answer is that your need may be smaller than you think, though buying while young and healthy locks in a price you will never see again,” Ostro said.
I was really offended by TD rollover, this policy for a widower in her 90’s who likely would have accepted the offer seeing only that the cost did not change. Not knowing that TD had stripped out pretty much all insurance coverage. Really this is how a Professional business operates?
TD sent my renewal offer where the monthly cost would be 17 cents less per month. In doing so the new policy doubled my deductible, removed coverage for all surface water events, wind and storm damage, water tank and sewer back-up. I just mailed my cancel policy today. Yet they claimed to value my house at 2m the last sale on the block was 1.175m
The deleting of comments is getting pretty bad on here, and elsewhere. This place uses an AI watchdog. What’s crazy is spammers and offensive pro-liberal, anti-white posters have complete access to posting nonsense and blatant misinformation.
Thanks for deleting my comment Global News. Liberals have ruined this country
This seems like something the Liberal government should help with…
Ba ha ha ha ha they won’t cause they caused all the problems! Thanks Justin! Thanks everyone who voted the liberals in! Middle fingers up!
The 62% of people who aren’t convinced they are fully protected are right. We are being scammed into trusting the auto insurance we are forced to buy has value.
In Ontario over 16,000 injured claimants end up at the Tribunal every year trying to collect supports after an injury. That means about half of all claims are denied! And that means taxpayers end up footing the costs of injured people.
It all sounds good until you have to use it.
I have nothing but truck insurance. I have cancelled all the rest. Im sick of what the bank, insurance companies and government are doing to hedge profits and milk everyone.
I had a small incident with my truck whereby a Porsche pulled a left turn in front of me at a intersection at low speed. My front bumper assembly got dimpled pretty good and he f*cked up his $20,000 paint job. He was in the wrong.
I was coming through on a green, he jumped his red and slid out in front of me. ICBC wants charge us both 50/50. I said no and withdrew my claim. I dont care what the other idiot does.
44 years I have been driving. One accident about 20 years ago and my rates still climb from other folks who just cannot drive! Im sick to death of it!!
I pay $1200 per year on a 400,000km, 14 year old car, occasional drive policy (less than 5000km annual). No accidents, no tickets, 20 years as a customer with this broker. So every new-comer that runs into something and makes a claim drives my rates up.
Insurance is legalized extortion, right?
It’s, by another name: Protection Money.
Give me a break. 1 in 3 in really high though. When I was young, and felt I had absolutely nothing but goid health, sure.
Being a city dweller with no car, no owned home, no real property, yeah…I get it, maybe.
My guess is that the data is skewed by individuals lacking the critical skills to get the needed to create a true picture.
Insurance is a total racket.
With CGL, auto, farm, and health im paying nearly $2500 a month for insurance.
I had a major structural damage claim on a building due to wind. Turns out I pay premiums on the replacment market value but after depreciation, the claim was going to cover me for $200 of a $20,000 bill. I would lose my claims free discount too.
When it comes to auto, i pay north of $1500 a year for insurance on a $2000 farm truck.
Stupid.
My opinion, of course, is that insurance resolves government, business and individuals economic liabilities and should be covered through taxes for everyone up to a certain income.
We just have to stop wasting billions of dollar’s on certain groups of people that can only be described by means our government should be incapable of identifying.
I would cut my cell phone, not to say money, but because I am sick of paying for a product that gets crappier by the second.
Good luck getting insurers to cover many things!
Wrong, wrong, wrong…
House insurance, for me adds up to $100k over the time i own my own home – I will probably never have a claim. I am an average home owner.
Imagine what you could do with that amount of money. Buy a new truck for CASH!. Look down your street. How often has a house burnt down? The bet is, that you think there is a better than 1 in 3 chance that your house burns down. – Anything less, and you can pay for the repairs from the savings and still be ahead.
Life insurance is betting that you will not only die early, but while having someone depend on your income.
Car insurance, other than PLPD is betting someone that you are a bad enough driver that you will get into an accident. Sounds sort of dumb.
We have to keep in mind insurance is based on not only the stats (likelihood of a claim) but also to give profit to the insurance company, and the broker. – It is a guaranteed losing bet.
@Biny. You realize it was the Liberals who initially put on the consumer carbon tax right? Do you thank an Arsonist for giving you a fire extinguisher after he sets your home on fire.
Canadians are trying to save money anyway they can. Soon we will have nutrition experts saying children are not eating healthy foods anymore. Parents will be making choices between healthy foods that are getting more expensive every week or foods that will fill children’s stomachs. Carney said to judge him on food prices well he has failed miserably
We cant cut insurance, its illegal to not have it.
You metaphorically have our balls in a bench vice.
Insurance is kind of a scam. The companies make you pay for years, and then when you actually need them, they try to find any excuse NOT to help you. What’s the point of paying for insurance if the insurance isn’t worth the paper it’s printed on?
Carney failure
“More than six in 10 (62 per cent) said they aren’t confident their coverage would fully protect them in an unexpected situation.”
Understandable, insurance companies will ‘ “weasel out” (avoid a task or break a promise by using clever, sneaky, or dishonest tricks) at any chance to not cover people’s losses.
Ok. I see. I know. Fine. Thfhjfn166363763-5-7-82773773
@Binyamēm, go back to whatever communist hole you crawled out of
“Do whatever you have to in order to protect our profit margins!” wail insurance companies, when told they are making life more difficult and unaffordable for Canadians.
Maybe it’s time to replace them with public insurance underwritten by taxpayers. After all, it can’t be any worse than what we have, and there is plenty of evidence it would be better.
Thankful that the Carney government eliminated the carbon tax, tax on petrol, and gave a middle class tax cut. All Poilievre does is complain.
Ok. I see. I know. Fine. Aldnxjaldncnzkwmnf92648291
I see. Ok. Fine. Slfnnxksndndjs,sn?’;’#(,!