Yes. Ontario law does not force you to carry home insurance, but almost every mortgage lender in the province treats it as a condition of funding, so in practice you cannot close on a house without a policy in place. The requirement is the lender's, not the government's, and it holds for the entire life of the loan.
The reason is straightforward. Your lender is putting up most of the money for a property they do not physically control. If the house burns down halfway through a 25-year mortgage, the building securing that loan is gone, and the lender wants protection against that outcome. Fire coverage is the piece they care about most, which is why the requirement still shows up as fire insurance in some older paperwork. Your policy names the lender as loss payee, meaning any payout for major damage flows to them first to cover what you still owe.
Timing catches a lot of first-time buyers off guard. You need proof of coverage before closing, not after you move in. Once your financing is firm, your insurance broker issues a binder letter that acts as temporary proof the policy exists. Your real estate lawyer will ask for that binder and forward it to the lender before releasing funds on closing day. No binder, no keys.
It helps to know what this insurance is not. Home insurance protects the property and your belongings. That is a different thing from mortgage default insurance, which protects the lender if you stop making payments and usually applies when your down payment falls under twenty percent. It is also separate from the optional mortgage life insurance a bank might offer. Only the property policy is mandatory for closing.
Cost depends on the building. A detached Toronto house often runs somewhere between $1,250 and $2,100 a year, while condo unit coverage tends to sit lower because the corporation insures the structure itself. Standard policies leave out overland flooding, sewer backup, and earthquake damage unless you add those endorsements, so read what is actually covered before you sign anything.
Related reading: What Is a Mortgage Commitment Letter in Ontario?, How Much Are Closing Costs When Buying a Home in Toronto?, and What Is Mortgage Default Insurance in Ontario?