North Bay business owner Ken Sim said he was shocked when he recently opened his insurance renewal letter and found it included premium increases of 200 per cent – including hikes nearly tripling the insurance related to snowplowing operations.
Sim is the owner of Canor, in operation since 1979. It is one of the largest local snow removal companies, with 100 employees during the winter season. Canor also offers professional construction and landscaping in North Bay and the surrounding area.
He said the insurance hikes have come in addition to the challenges snow removal businesses are facing due to the impact of COVID-19 restrictions. A lack of insurance companies willing to provide coverage for snow removal operations cripples already struggling small businesses across the province, forcing them to forgo services, layoff staff – and in some cases, permanently close their doors.
The lack of notice regarding the renewal increases within the industry placed more constraints on operations, Sim said.
"If we would have been forewarned on the drastic increase in insurance costs, we may have reviewed, negotiated, and amended contracts to reflect these changes."
Industry officials say the significant hike in premiums is tied to global insurance market trends showing an increase in slip-and-fall lawsuits – sometimes frivolous – causing insurers to raise rates and deductibles or altogether decline coverage.
Insurance companies are settling rather than risk further exposure to litigation but this leads to black marks on the records of small businesses.
In response, Muskoka-Parry Sound MPP Norm Miller brought forth Private Member’s Bill 118 and it was adopted December 8, 2020.
Bill 118 amends the Occupiers' Liability Act by reducing the statute of limitations period for notification of slip-and-fall lawsuits from two years to 60 days, decreasing the risk of liability and aligning the private sector with municipal standards.
Sim said this measure has not yet resulted in any premium reductions on Canor’s insurance policies.
"We have invested in technology, equipment and tracking software to provide reliable and safe service to our clients, yet we continue to see our insurance increase," Sim advised.
"Increasing costs due to unmanageable insurance premiums not only halt industry growth but lead to business closures, loss of employment, and lack of needed services."
Sim said education and awareness are key to moving forward.
"We are working together as an industry to find solutions, while highlighting the impact this is having on companies like ours," he said.
"As we wait for further changes to happen from the passing of Bill 118, we look to creating awareness, adjusting contracts, and reviewing requirements and fee structures to mitigate the losses felt by snow removal companies and ensure these services can still be delivered safely and effectively."
Sim suggests business owners and property managers review and adjust contracts with snow removal providers to ensure that the level of liability is shared between both parties.
"When we see insurance increases of more than 200 per cent in one year, it has to be reflected within contractual agreements and pricing structure. Unfortunately, as our operating costs increase, the costs of our services have too as well," said Sim.