Understanding Insurance Types for Canadian Real Estate Investors

By Wayne Hillier, Real Estate Investing Masters

July 9, 2025 | Edmonton, AB

As a real estate investor in Canada, understanding the different types of insurance is critical, not only to protect your investments but also to ensure you're not financially wiped out by an unexpected event. Whether you're a landlord, a condo owner, a flipper, or even a tenant, the right insurance can be the safety net that keeps your business intact.

In today’s episode of the Real Estate Investing Morning Show, we broke down the most common types of property-related insurance in Canada and explained how deductibles can impact your monthly premiums and overall risk strategy.

Condo Insurance: Two Types to Know

1. Unit Owner Insurance

If you own a condo, your policy typically covers everything inside the unit: contents, appliances, improvements, and personal liability. This becomes especially important if damage in your unit affects others, such as water damage that leaks into neighboring suites. You could be on the hook for the condo corporation’s deductible.

2. Condominium Corporation Insurance

The condo corporation is responsible for insuring everything outside the unit: common areas, the structure itself, roofs, siding, windows, and major systems

like sewer lines. The cost of this policy is usually factored into your monthly condo fees.

Homeowner’s Insurance

This is standard for anyone who owns their primary residence. A robust homeowner’s policy should cover:

• The structure itself

• Contents inside the home

• Liability protection

• Additional living expenses (like hotel stays if your home becomes uninhabitable)

• Optional add-ons like sewer backup, overland water, or flood coverage

Home insurance is about more than just asset protection. It’s about preserving your lifestyle in the event of a major loss.

Landlord Insurance

If you're renting out a property, a landlord policy covers:

• The building

• Your appliances and fixtures

• Your liability as a landlord

• Optional coverage for tenant damage or loss of rental income during uninhabitable periods

One major consideration: many landlord insurance providers require that your tenants carry their own insurance policies. This minimizes liability risk in the event of tenant-caused damage or personal injury claims.

Tenant Insurance

Tenants often overlook insurance, but it protects their belongings and provides liability coverage. A simple $20–$30 monthly policy could protect them from:

• Loss due to theft, fire, or water damage

• Liability claims (such as dog bites or injury on the premises)

Landlords should require proof of tenant insurance in their lease agreements and verify that it’s maintained throughout the tenancy.

Fix and Flip Insurance (Builder's Risk)

If you’re flipping a home or completing a BRRRR where the property is vacant during renovations, standard landlord or homeowner insurance won’t cut it. You’ll need a builder’s risk policy.

This specialized insurance covers:

• Vacant properties

• Construction-related damage

• Theft or vandalism

• Water damage from frozen pipes

Expect to pay significantly more, often hundreds per month, and you’ll likely need to prepay a few months in advance. But this is the proper and legal way to insure your investment. Never misrepresent a vacant flip as a rental to get cheaper coverage. If something goes wrong, your claim could be denied.

How Deductibles Impact Your Premium

Your insurance premium (monthly or annual cost) is directly affected by the deductible, the amount you agree to pay before your insurance kicks in.

• Low deductible = Higher premium, but less out-of-pocket when you file a claim

• High deductible = Lower premium, but more personal cost if something goes wrong

For example, if a sewer backup cleanup costs $750 and your deductible is $1,000, insurance won’t cover anything. That’s why it’s important to choose a deductible that aligns with your risk tolerance and cash reserves.

Expert Tips for Real Estate Investors

• Work with an investor-focused broker who understands the specific needs of landlords, flippers, and BRRRR investors

• Do not delay insurance coverage, get it in place before taking possession

• Verify tenant insurance and enforce it through your lease

• Keep an organized digital and paper record of all policies, receipts, and communications

As always, our podcast provides high-level insights and real examples to help you become a smarter, safer investor. Insurance is a cost of doing business, and cutting corners could cost you far more in the long run.

Listen to Today’s Episode:

Real Estate Investing Morning Show – Hosted by Wayne & Gabby Hillier

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Wayne Hillier - Alberta Real Estate Investing Expert

About the Author

Wayne Hillier is one of Canada’s trusted experts in real estate investing education, specializing in Alberta’s thriving markets. Based in Edmonton, Wayne has over a decade of experience building a high-performing rental portfolio and coaching investors to achieve strong cash flow, sustainable wealth, and creative financing success. As co-founder of Real Estate Investing Masters, Wayne is a respected real estate investing coach and mentor, dedicated to helping Canadian investors confidently scale their portfolios. He is also the host of The Real Estate Investing Morning Show, Canada’s #1 daily podcast for real estate investing education.