Most personal insurance claims in Canada, such as health, auto, or homeowners’ insurance payouts, are not considered taxable income and therefore are not subject to income tax. Life insurance death benefits, as mentioned, are typically tax-free. However, there are some exceptions depending on the nature of the claim. For example, if you receive an insurance settlement for lost business income or critical illness insurance where the payouts are structured in certain ways, those amounts could be taxable. Business-related insurance claims may also have different tax treatments compared to personal claims. If the proceeds are compensating for something that would normally be considered taxable income (like business interruption insurance), then they might be taxable. Always check the specific terms of the insurance policy and consult with a tax professional to ensure accurate reporting, as Canadian tax rules can vary depending on individual circumstances and the type of insurance involved.