Does home insurance cover wildfire damage?

As a result, many in British Columbia, Alberta, Saskatchewan and even Quebec (where risk appears to be highest for wildfires) are wondering if their home insurance would cover damage from wildfire and/or smoke. Here’s what you need to know. 

Does home insurance cover wildfire and related damage? 

Yes. All standard home insurance policies, including tenant insurance and condo insurance, cover damage caused by wildfires and smoke. The cause of the fire doesn’t matter—as long as it was not deliberately started by the policyholder. 

In addition to providing coverage for damage to the structure and the contents of the home, home insurance can cover some of the additional living expenses that come from needing to relocate, either due to an evacuation order, damage to property or damage to other homes nearby (in instances where your home has not been damaged, but it’s still too dangerous for you to live there). Eligible expenses include the costs of accommodations, food and fuel. 

Note, however, that coverage for additional living expenses only applies to costs that are in excess of what you would typically spend. So, in an example provided by the Insurance Bureau of Canada (IBC), if you spend $500 per week eating out while you’re displaced from your home, and you would normally spend $100 per week on groceries, you can claim $400 in additional living expenses. 

If you are indirectly impacted by a wildfire, you may still be eligible for coverage. For example, if there’s a power outage and the food in your freezer or refrigerator spoils, you may be able to receive compensation for the lost food. 

Before making a claim—particularly for smaller losses such as food—consider the impact it may have on your insurance premiums, and check if the loss exceeds your insurance deductible. Making a claim can lead to paying higher premiums in the future. To save on home insurance, some insurance experts advise paying out of pocket for small claims you can afford upfront. 

What if your car is damaged in a wildfire? 

Unlike home insurance, auto insurance does not automatically cover damage from a fire. In fact, only comprehensive or “all perils” auto insurance policies include coverage against fire damage. These are optional coverages, so check your policy for details. 

Can you change your policy during a wildfire emergency? 

If you live in an area impacted by wildfire and don’t currently have home insurance, it’s unlikely that you’ll be able to obtain coverage. You may not be able to make changes to an existing policy, either. During major weather events that pose an “imminent threat,” insurance companies can temporarily limit the sale of new policies in the affected area, says the IBC. 

Insurers will typically renew existing policies, and during a state of emergency declared by the local government, they may even extend your coverage for up to 120 days beyond the expiration date if the crisis prevents you from renewing on time. 

However, you may not be able to make major changes to your existing policy. For example, insurance companies often restrict or prevent you from changing your deductible or insured limits until there is no longer an emergency. 

How to make a claim for wildfire damage

To make a claim, you will have to catalog the extent of the damage to your property. Make a list of every item that has been destroyed or damaged. And if it is possible and safe to do so, gather any documentation that can help support your claim, including proofs of purchase, photos, receipts, warranties and photos of the damaged property. The IBC suggests keeping damaged items that are a part of the claim, unless they pose a health hazard. 

Once you have tallied the damage, your insurance company will ask that you complete a “proof of loss” form. This document contains a list of all the property and items that have been damaged or destroyed, as well as their value. 

Once you have reported the damages to your home, you will be assigned an insurance adjuster, whose role is to investigate the damage and evaluate your claim. The adjuster may need to wait for the provincial fire authority to release your property before they can begin to assess it, according to the IBC. 

Remember, home insurance covers certain costs indirectly related to a wildfire, such as costs of living in a hotel room during an emergency. If you’re unable to return home during or after the fire, don’t forget to keep all documentation related to your living expenses, which could help support a claim for additional living expenses. 

How long do you have to file a claim? 

If your home has been damaged by a wildfire, submit your fire claim as soon as possible, even if you don’t yet know the extent of the damage. The IBC recommends contacting your insurance company right away—many providers offer 24-hour claims service. If you don’t know the name of your insurance representative, contact your insurance company. You can also contact the IBC’s Consumer Information Centre for support. 

Filing your claim quickly will help you get reimbursed sooner. If you don’t yet know the extent of the damage, don’t worry. You typically have up to two years to make a claim or add items to an existing one. This should give you enough time to collect all the information needed to support your claim.

Read more about home insurance:

• Home insurance: Are you covered for wildfires, floods and other climate-related disasters?

• Watch: Climate change in Canada and the rising cost of home insurance
• How does flood insurance work?
• How does earthquake insurance work?

About Justin Dallaire

Justin Dallaire is the senior editor at MoneySense.ca. He was previously an editor at Strategy magazine and has a master’s degree in journalism from Toronto Metropolitan University.

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