Faraday has insurance coverage update from McDougall Insurance

·5 min read

At their meeting on Sept. 7, Faraday Township council had a presentation from Dwayne Sutherland, partner and regional manager of McDougall Insurance and Financial and Debra Murphy, regional manager Ontario east of Intact Public Entities about updates to the municipality’s insurance coverage going forward into 2023. Sutherland and Murphy informed the council that their coverage would cost 18.5 per cent more this coming year versus last year, or $129,575 excluding taxes.

Mayor Dennis Purcell introduced Sutherland and Murphy and invited them to proceed with their presentation. Murphy thanked council and said it was great to have her first face to face meeting in two years [because of COVID-19] and it was great to be there.

Murphy told council that they were looking at a bottom line of 18.5 per cent, which was pretty much keeping with what Faraday had last year, equating to $20,000 on the bottom line.

“As I was saying to Dwayne, this is representative of what we’re seeing of a good municipal account today. This would be considered a strong client, one to keep on the books, one that has useable claims experience. Coming in between 16 and 19 per cent is where we’re seeing things fall,” she says.

Murphy said one thing driving the top four big dollar premiums was their general liability coverage as their cornerstone policy. This would respond to any members of the public getting hurt at a township facility, where negligence is alleged.

Murphy said they’d also integrated into the policy Faraday’s population growth, as compiled by StatsCan in 2021, which recorded a 15 per cent increase. She said that with this population increase, which was enviable and keeps everything viable, it also means an increased demand for services and with that increased demand comes an increased risk of something adverse happening, so it had been factored into those liability sections of the policy.

Another new thing this year, according to Murphy is that historically abuse coverage was in the policy.

“It was there and we were silent about it, we didn’t define it, didn’t draw it out as a line item on your insurance policy to show you had coverage,” she says.

However, a lot of abuse claims have been coming in in the last decade all over the place, so she said that Intact Insurance had to define it more clearly, clamp down on it and make it more distinct as a line item on insurance policies. She said the coverage was at $2 million for any one claim in any given year, with a minimum premium of $1,000.

“So, you’ve got $1,000 built into your general liability cost this year that wasn’t there last year, in addition to population growth,” she says.

For property, Murphy said they had a nine per cent as their current inflation, which she said seems high, but remarked what it was like trying to get a contractor here in Canada or around the world to build a home for example, in a relatively short amount of time with all the shortages punctuating the construction industry due to COVID-19.

“So, inflation is really high right now on the property side and that impacts on your property insurance,” she says.

For their auto policy, Murphy said that they’d taken the International truck off the policy and put on the 2022 Ford F-250.

“Now the International was a heavy and you’d think that would be more expensive to insure but the 2022 with replacement cost coverage and the value of a truck today there’s a net difference of $1,000 attributed to the betterment of what your fleet looked like last year versus what it looks like this year, even though your numbers are the same in terms of units insured,” she says.

“So, that’s my condensed, hitting all the high points overview. Your program hasn’t really changed in its core. You still have your $50 million limit, you’ve got your $10,000 deductible on your liability losses and $5,000 on your assets like your property, equipment and your vehicles,” she says.

Murphy also revealed that unlike in previous years, this year all their clients now have communicable disease/outbreak exclusion in their policies where they didn’t before. She said that they had never intended to cover it but that the wording of the policy was so broad that it ended up being successfully argued to be covered. That has been changed this year.

With regard to flood and earthquake coverage for other property without cost, which they used to have, this year they now have that coverage for building contents and equipment in case of flood or earthquake for a charge of $260 in the policy. She said that now Faraday has a curve premium deductible, unlike last year, so if they have a flood at the municipal office this year, they’d have a $25,000 deductible, or if they had a flood at the community centre, they’d also have that $25,000 deductible.

Sutherland reiterated that it had been a tough three or four years, and that they had seen some significant increases.

“The market amongst all municipal carriers is up drastically. I will say just for what we’ve seen, 18.5 per cent is a tough one, but it’s on the lower end. Hopefully the market will correct, we’ve seen the ups and downs over the years and hopefully this is the tail end of a hard market. It’s certainly the hardest I’ve seen in 28 years so hopefully we’re done,” he says.

Switzer remarked that they’d always had great service with McDougall Insurance/Intact Insurance and she was glad to stay local.

Purcell thanked Murphy and Sutherland for their presentation.

“Debra and Dwayne, excellent presentation as usual. It’s always great to have a presence in Bancroft and thank you,” he says.

Purcell then read the resolution that Faraday accept the quotation from Intact Insurance in the amount of $129,575 plus tax for the provision of insurance coverage for the period from Oct. 3, 2022 to Oct. 3, 2023, which was passed by council.

Michael Riley, Local Journalism Initiative Reporter, The Bancroft Times