A guide to home and car insurance for newcomers to Canada

This article was last updated in Februrary 2026.

Relocating to a new country is an exciting adventure, but it can also be overwhelming. With a long list of things to do, it’s easy to overlook the importance of buying insurance upon arrival.

But the reality is: insurance is a key part of life in Canada. Whether you’re renting or buying a home, driving an existing vehicle or purchasing a new one, it’s one of the best ways to make sure you’re financially protected in case of an emergency.

However, depending on the province you live in and the insurance provider you choose, your out-of-country driving experience and insurance history may not be considered by Canadian insurance providers when determining your premiums.

Here’s what newcomers need to know.

Car insurance as a newcomer

If you plan to drive in Canada, car insurance isn’t optional, it’s mandatory. Here’s what you need to know to get started:

How do you get a Canadian driver’s license as a newcomer?

Most newcomers must exchange their foreign driver’s license within about 60 days of arrival, though timelines vary by province. Some regions have reciprocal licensing agreements that make this process easier: if your home country is recognized, you can often exchange your license for a Canadian one without taking knowledge or road tests.

Example:
Ontario’s Ministry of Transportation (MTO) recognizes licenses from countries such as the U.S., Australia, Germany, France, South Korea, and others. If your country isn’t on the approved list, you may need to complete testing before a Canadian license is issued.

To speed things up, bring an official driving abstract from your home country. Many provinces require this document to verify your licensed years.

How do you purchase car insurance in Canada?

You must have car insurance to drive legally in every province and territory. At minimum, all drivers need third‑party liability coverage, with required limits varying by province. If you use someone else’s vehicle regularly, you must be added to their policy.

Where you buy insurance depends on where you live:

• Private insurers operate in Ontario, Alberta, and Atlantic Canada.
• Public insurers operate in B.C. (ICBC), Manitoba (MPI), and Saskatchewan (SGI).

To get insured, you’ll need:

• Your Canadian or foreign driver’s license information
• Vehicle details
• Proof of address
• Any driving history that might help reduce your rate

Car insurance protects you financially if you cause injuries, damage property, or are involved in a collision — and you cannot legally drive without it.

Will your driving history from another country count when buying car insurance in Canada?

It depends on the province and the insurance provider. Driving experience from outside Canada isn’t automatically recognized, which is why newcomers may initially face higher premiums.

Here’s how it works:

1. Some insurers accept foreign experience

Companies like Onlia and Sonnet may consider out‑of‑country licensed years if your provincial licensing authority has verified your record.

“Onlia accesses information on a driver’s driving history from official sources such as the Ontario Ministry of Transportation (MTO),” says Pieter Louter, the former CEO of Onlia. “We're one of the few insurers who considers out-of-country licensed years, as long as the MTO has your foreign driving record registered.”

2. Reciprocal agreements help

If your home country has a reciprocal licensing agreement with the province where you settle, your driving experience is more likely to be accepted because your licensed years can be formally registered. This applies to countries commonly recognized by Canadian provinces, such as:

• United States
• Australia
• Germany
• France
• United Kingdom
• South Korea
• Japan
• Switzerland

Each province has its own list.

3. Your record must be registered in Canada

Insurance companies rely on provincial transportation ministries (e.g., MTO, ICBC, MPI) to confirm foreign driving experience. If your record isn’t registered, insurers cannot consider it.

It’s recommended that you bring a driving abstract or letter of experience from your previous licensing authority. Register it with your provincial transportation ministry as soon as you arrive, then ask insurers if they can use it to lower your premium.

Read more: Everything you need to know when buying car insurance

Home insurance as a newcomer

Unlike car insurance, home insurance isn’t mandatory in Canada. That said, almost every mortgage lender in Canada will insist that you purchase it before approving you for a mortgage.

It may seem like just another expense, but when you consider that most people can’t afford to pay for something like a flooded basement out of pocket, which can cost $43,000 to repair, it’s invaluable protection if you can’t afford to replace anything you own in the event of a disaster.

What does home insurance cover?

A standard home insurance policy typically includes:

• Property coverage: Protects your home and belongings from risks like fire, theft, or natural disasters.
• Liability coverage: Covers legal and medical costs if someone is injured on your property or if you accidentally damage someone else’s property.

Additional endorsements are also available for high-value items like jewelry or art, as well as coverage for risks like flooding or earthquakes, depending on where you live.

How much does home insurance cost?

The cost of home insurance in Canada depends on different factors, like the type of home you have, where it’s located, and whether you’ve made insurance claims in the past. Insurance companies also look at the age and condition of your home, including the roof, plumbing, and electrical systems, as well as risks like bad weather or crime in your area.

Here’s an example of estimated home insurance costs for a detached, 2,003‑square‑foot home in Richmond, based on LowestRates.ca data from February 2026:

• The lowest available quote for a detached home with no previous claims was $249 per month ($2,989 per year).
• The average rate for similar homes in the area was $304 per month ($3,645 per year).
• By comparing quotes, the homeowner could save $55 per month, or $660 per year — an 18% difference.

Keep in mind that your home insurance history from another country does not transfer when you move to Canada. When you buy a home here, you’ll need to purchase a new property insurance policy and begin building your Canadian insurance history from scratch.

Read next: Contents insurance 101: What it covers and why you need it

Tenant insurance as a newcomer

Moving to a new country is expensive, and you may not be in a position to purchase a home right away. If you’re renting, you should strongly consider renters insurance.

As is the case with home insurance, tenant insurance is not mandatory, but it’s the best way to protect yourself and your belongings.

Why you need tenant insurance

As a renter, your possessions — furniture, appliances, and clothes — are not covered under your landlord’s insurance. If your rental unit is damaged by a fire, burglary, or other hazards, you will be responsible for the costs. That’s why many landlords insist on their tenants having this type of insurance.

It also includes:

• Relocation coverage: Covers temporary living expenses if your rental becomes uninhabitable.
• Liability protection: Protects you financially if you accidentally damage a neighbor’s property or if someone is injured in your rental unit.

Renters insurance is affordable, with policies starting as low as $15–$30 per month, depending on your coverage needs.

Read more: Know your rights: 6 things landlords can’t stop you from doing

How to save on insurance as a newcomer

Insurance can be expensive, especially when you’re starting fresh in a new country. Here are some tips to save money:

• Shop around: Use a comparison tool like Lowestrates to get quotes from multiple insurers.
• Bundle policies: Combine your car and home/tenant insurance with the same provider to save up to 15% on premiums.
• Ask about discounts: Some insurers offer discounts for safe driving, installing home security systems, or being claims-free.
• Leverage your history: If possible, provide proof of your driving or insurance history from your home country to qualify for better rates.

Shopping for insurance can be daunting, particularly for beginners. However, learning about insurance options in your new country is an integral part of acquiring financial literacy skills and building a credible insurance history.

Gaining a working knowledge of insurance will help you make informed financial decisions, secure lower insurance rates, and provide help with financial planning, all of which are essential for you and your family to secure a stable financial future in your new homeland.

Learn more: Should you notify your home insurance company if you fix the damage yourself?