With urban sprawl continuing to expand, it may not seem like rural properties make up as significant a percentage of Ontario residences as it does.
While the share of those living in rural areas within Canada did fall from 18.7% in 2016 to 17.8% in 2021 (the year of the last census) that’s still 6.6 million people, a population increase of +0.4% compared to 2016. (1)
WHAT IS CONSIDERED A RURAL PROPERTY?
The definition of “rural” is actually up for debate.
Some question whether rural refers to a geographical concept (e.g. a location with boundaries on a map) or a social representation (e.g. a community culture) and if you focus on it being a geographical concept, does that depend on population density, population size, distance from an urban are? (2)
For purposes of insurance, most providers define a rural property as any residence that is more than 13 km from the nearest fire service station. More on that is below.
RELATED ARTICLE: Hobby Farm Insurance
WHAT MAKES RURAL PROPERTY INSURANCE DIFFERENT FROM REGULAR HOME INSURANCE?
There are only 2 main differences between a rural property and a property located “in town” when it comes to insurance.
- Risk
- Cost
A general rule of thumb when figuring how much something costs to insure is that higher risk = higher cost.
WHAT MAKES RURAL PROPERTIES A HIGHER RISK?
It mostly boils down to the level of fire protection available for a home.
- A rural property often means it’s not close to a fire hydrant (meaning fire services are limited to the amount of water that can be hauled in)
- The same can be said for a fire station (meaning the response time is slower compared to homes in the city)
Because of factors like this, the unfortunate reality is that rural properties are often more susceptible to suffering a total loss due to fire.
Other factors that can also contribute to the higher home insurance costs for rural properties:
- If they’re serviced by a full-time fire hall or by volunteers from the community
- If there are ponds on the property (which will require proper fencing)
- If livestock is raised which requires additional liability through livestock insurance
- Those with more land on rural properties often own ATVs or snowmobiles which may require separate auto insurance protection
- Lack of street lighting and remote locations can be a reason for concern for burglary, robbery and vandalism
WHAT DOES RURAL PROPERTY INSURANCE COST?
While it seems with everything else being equal, a home located in a rural area is typically more expensive to insure than a home located in an urban area, the specific cost of insurance for any property will still depend on factors such as:
- Replacement value
- Heating source
- Age of home
- Security systems
- Pool
- Past claim history
- Extra liability risk
It’s best to get a quote for home insurance from a few different providers and see which one you feel most comfortable with.
Erie Mutual Insurance proudly serves the commercial insurance, farm insurance, home insurance and auto insurance needs of members throughout Southern Ontario including Haldimand, Niagara and Hamilton.
Please don’t hesitate to contact us with any questions you may have about this or any other topic related to your insurance.
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SOURCES
1 – www12.statcan.gc.ca/census-recensement
2 – www150.statcan.gc.ca
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