Operating a home without property insurance is not illegal under any federal or provincial statute in Canada, meaning a homeowner who owns their house completely free and clear of any mortgage can legally choose to assume all financial risks of going uninsured. However, if there is an active mortgage registered against the property, the lending institution will contractually mandate continuous homeowners insurance to safeguard its financial security interest. Letting a policy lapse in that scenario results in the lender purchasing expensive force-placed insurance and billing the homeowner directly.
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