What Builder’s Risk Insurance Costs in Ontario: Rates, Worked Examples and What Moves the Premium

Construction Insurance

What Builder’s Risk Insurance Costs in Ontario: Rates, Worked Examples and What Moves the Premium

Builder’s risk is priced as a percent of what it would cost to rebuild the house, not counting the land. The Canadian sources we checked do not agree on the percent, which is why one homeowner is told four thousand dollars and the next is told twenty for the same house. Here is the published range, our planning numbers inside it, two worked examples that add up, and what moves the quote.

Prices checked November 2026, from Ontario and Canadian brokerage pages, insurers’ guides and lender documents, with our planning numbers marked as ours. They are not what we pay on our own builds, and they are not a quote.

The Short Answer

Budget about 1 percent of the hard construction cost for a nine to twelve month build by a licensed builder in a protected area, usually paid once for the term. The free cost calculator works your own numbers through the same way this page does and writes a quote request sheet you can send to brokers.

0.5% to 4%published Canadian range
0.9%our middle planning number
$4,500on a $500,000 build at 0.9%
3 to 12months per term

We build houses and carry these policies on every one of them; we do not sell insurance. The binding answer on any policy comes from a RIBO-licensed broker; what follows is a builder’s reading of a lot of quotes, not a rate card.

Worked Examples: a $500,000 and a $1,000,000 Build

The Canadian sources split into two camps. An Ontario and Quebec brokerage and a Canadian renovation marketplace put most policies between 0.5% and 1% of completed value. Two Ontario brokerages and a Canadian comparison site say between 1% and 4%. A US personal-finance site says 1% to 5%, a different market. Our planning numbers sit inside the Canadian range: 0.5% low, 0.9% middle, 1.5% high, for a nine to twelve month wood-frame or ICF house by a licensed builder, hydrant and fire hall within 8 km, $2,500 deductible, no soft costs.

Hard construction costLow, 0.5%Middle, 0.9%High, 1.5%Top of the published range, 4%
$500,000 house$2,500$4,500$7,500$20,000
$1,000,000 house$5,000$9,000$15,000$40,000

November 2026. The first three columns are our planning numbers inside the published range. The last column is the top of the published range from the brokerages that say up to 4%; it is not our estimate, and we have not seen an ordinary protected house quoted there. Ontario retail sales tax of 8% applies to most property insurance premiums; HST does not. So $4,500 becomes $4,860.

Why insurance prices are all over the map: the brokerages, insurers’ guides and lenders we checked did not agree on the same build. An Ontario and Quebec brokerage and a renovation marketplace said 0.5% to 1%; two Ontario brokerages and a comparison site said between 1% and 4%; a US personal-finance site said 1% to 5%; the only Ontario dollar example, from a rate-comparison site, was $4,000 to $6,000 for six months. On a $500,000 house that is $2,500 or $20,000. The gap: percent of hard cost or a flat minimum, term, deductible, construction type, fire grading, soft costs and liability in or out. Budget about 1 percent, $4,500 on a $500,000 house, and get two or three quotes on one written description of the build.

Small jobs usually sit at the high percent because of minimum premiums; the bigger the house, the closer the percent tends to fall to the bottom of the range.

What Moves the Premium

FactorEffect on the premiumWhere the number comes from
Term3, 6, 9 or 12 months; beyond 12 pro rata, plus one usual extension at additional premiumOntario brokerage pages for the terms and the extension; pro rata beyond 12 months is our assumption
DeductibleHigher deductible, lower premium. Expect $1,000 to $5,000 on a house build, often higher for water; no Canadian page prints a percent savingOur reading of the quotes
Owner-builder, no licensed GC+25% to +50%Our assumption, used in the calculator
Unprotected fire grade (over 8 km to a fire hall, no hydrant within 300 m)+30% to +100%Brokers quoted in a BC newspaper; the Fire Underwriters Survey says protected communities can see up to 70% lower premiums
Soft-cost endorsement+5% to +15%Our assumption
Monitored alarm or camerasabout -5%Our assumption; a small credit at best
Log or timber frame+10%Our assumption; higher repair cost
ICF or concrete walls0%No automatic discount in Canada; see below
Minimum premiumSome insurers have one; one Canadian managing general agent advertises none on ground-up projectsAsk on the quote

Adjustments marked as our assumption are the ones the calculator uses. Planning figures, not rates from any insurer. Claims history and prior refusals push every line up; the application asks.

On ICF, straight talk. We build ICF houses (our building site is ICFhome.ca), so you would expect us to say concrete walls earn a discount. They do not, automatically; we have not found a Canadian insurer that publishes an ICF discount. Ask the broker to rate the walls as masonry and budget on no discount; the site, the distance to the fire hall and your claims history move the number far more than the walls. The ICF, log, SIP and modular page has the rest.

On fire protection. Protected means within 8 km by road of a responding fire hall and within about 300 m of a hydrant. Lose either and the quote climbs, by a third at the kind end and double at the other; the cottage and rural page covers it. On owner-builders: no licensed general contractor means the insurer is betting on your management. Some decline, most load the premium, all ask more questions. The owner-builder insurance page covers the application.

What the Number Is Based On

The insured amount is the completed rebuild value of the house, labour and material, excluding the land. The land does not burn, so you do not insure it. If you paid $350,000 for the lot and $650,000 to build, you insure $650,000, not the million.

Your lender may read it differently. A major bank’s instructions to its lawyers ask for insurance at “the full appraised completion value” before the first advance, and an appraiser’s number can include things the hard-cost budget does not. When lender and broker disagree, insure to the higher figure; the extra premium is small and a stalled first draw is not. The construction mortgage requirements page covers the reconciliation.

When the budget goes up mid-build. It does. Tell the broker and raise the insured amount; the additional premium is usually pro rata for the time left on the term. An underinsured policy can pay less than the loss, and the lender’s lawyer will notice the certificate no longer matches the appraisal at the next draw. We have dealt with lenders holding draws for paperwork, and this is one of the pieces of paperwork.

Paying for It and Comparing Quotes

Most builder’s risk policies are a one-time premium for the term, paid at binding. The Canadian pages we checked do not say whether monthly is offered, so ask. Put the premium in the budget as a line, because the lender wants it bound before draw one and draw one has not happened yet.

Homeowners lose money on quotes by picking the cheap one without noticing it is named perils, carries a water deductible several times the fire one, or runs six months on a ten-month build. Compare on the same written description of the build, then line the quotes up on these points.

  1. Same insured amount on every quote: completed rebuild value, land excluded, matching the lender’s appraisal.
  2. Same term, longer than the schedule, with the extension cost stated.
  3. All-risk or named perils. Not the same product at any price.
  4. Deductibles by peril: fire, theft, water.
  5. Off-site and transit sublimit against the real value of your window order.
  6. Soft costs and premises liability in or out. Assume property only unless liability is its own line.
  7. Lender named as mortgagee and loss payee, and the total with the 8% Ontario retail sales tax, because that is the cheque.

Two or three quotes on one description is enough. For the full picture of the three policies on a job, start at the construction insurance hub.

Plain words before the questions: this is general information from a builder who carries these policies, not insurance, legal or tax advice. Policies and rates differ from one insurer and one site to the next. Confirm everything with a RIBO-licensed broker and with your lender before you budget on it.

Questions people ask

How much does builder’s risk insurance cost in Ontario?

The Canadian sources we checked split between 0.5% to 1% and between 1% and 4% of the completed rebuild value, land excluded. Our planning numbers are 0.5%, 0.9% and 1.5% for a nine to twelve month build by a licensed builder in a protected area. The only Ontario dollar example published is $4,000 to $6,000 for a six-month new build.

How much is builder’s risk insurance for a $500,000 home?

At our planning numbers, $2,500 at 0.5%, $4,500 at 0.9% and $7,500 at 1.5% of hard cost, plus 8% Ontario retail sales tax. The top of the published range, 4%, would be $20,000; that is a figure brokerages publish, not one we have seen on an ordinary protected house. Budget about $4,500 and get two or three quotes.

How much is builder’s risk insurance for a $1 million custom home?

At our planning numbers, $5,000 at 0.5%, $9,000 at 0.9% and $15,000 at 1.5% of hard construction cost, before the 8% retail sales tax. The top of the published range at 4% is $40,000. Bigger houses tend to land nearer the low end because minimum premiums stop mattering; an unprotected rural site or an owner-builder with no GC pushes the other way.

Does increasing my deductible lower the insurance premium?

Yes. The sources that mention it agree on the direction, and none of the Canadian residential pages prints the percent, so we do not either; the calculator’s figure is labelled our assumption. Expect deductibles of $1,000 to $5,000 on a house build, often higher for water and theft. Pick one you could pay on a bad day.

Can builder’s risk insurance be paid monthly?

Most are a one-time premium for the term, paid when the policy is bound. The Canadian pages we checked do not say whether monthly is offered, so ask the broker; some insurers finance premiums and some do not. Either way the policy must be bound before the first lender draw, so the money comes out of your pocket at the start.

Is land value included in builder’s risk insurance?

No. The insured amount is the completed rebuild value of the house, labour and material, excluding land. Land does not burn or blow away. A lender may ask for the full appraised completion value, which can run higher than your hard-cost budget; when the two disagree, insure to the higher number and have the broker note why.

Run your own numbers before you call a broker

The free calculator applies these planning numbers and adjustments to your build, shows the published range beside them, and writes a quote request sheet so every broker you choose quotes the same house.

Price my builder’s riskBack to the insurance hub

Sources and further reading