An Alberta snow removal contractor has been struggling to get out of an expensive insurance premium situation.
Chris Jorgenson, Owner of Canada Yard Prohe told Global News that he was surprised when he got his latest renewal.
“Last year we paid $ 7,800,” he said. “This year, we got quotes of up to $ 65,000.”
Jorgenson said he has heard of 100 other snow removal contractors in the province also facing premiums up to nine times what they were previously charged.
“Basically everyone does not agree with the increases, but we have no choice,” he added.
“We cannot operate without insurance.”
Jorgenson managed to get his insurer to cut the hike to 30 percent, but said that came with a trade-off: He was prevented from clearing snow in high-risk slip-and-fall locations.
“We cannot do any type of medical facility, senior centers, schools, box stores with more than 50 parking spaces,” he said. “Just like any shopping center that has an attached bar, restaurant or lounge. The list goes on. “
And because most of the businesses he served in Edmonton fell into those categories, he had to make a tough decision and go out of business.
“It is disheartening,” he added. “We have been in Edmonton for 15 years.
“We have notified all of our clients and many of them just don’t know what they are going to do. Many of them will have a hard time finding an insured contractor. “
Albertans are furious at costly insurance rate increases amid the pandemic
the Canadian Insurance Bureau told Global News that in recent years, insurers have seen a significant increase not only in severe weather but in other commercial liability claims.
IBC said there have also been a growing number of injury lawsuits from those claiming to have fallen on snow and ice across Canada.
IBC spokesman Rob de Pruis told Global News that in 2013 insurers paid $ 2.4 billion in commercial liability claims. That number had risen to more than $ 5 billion by 2020.
“Between 2013 and 2020, we saw a 108 percent increase in commercial liability claims across Canada.”
de Pruis advised contractors to compare prices and, most importantly, review how they operate.
“Companies need to start taking control of their business and making sure they are really reviewing their insurance and risk management practices.”
He advised snow clearing companies, along with the contractors they hire, to document everything as well.
“Make sure they are actually taking photos, videos and also detailed records of when they are doing these cleaning operations. If a person slips and falls, they may not be aware of their injuries and their claim for their injuries for a couple of years after your event.
“That’s where this documentation and this evidence will really be key.”
Back in the driver’s seat when it comes to insurance rate hikes
Jorgenson said his company had only been involved in one commercial liability claim, four years ago, and it was found that he was not at fault. He believed that most injury claims are driven by people simply seeking payment.
“This affects everyone.
“It affects the individual that is a legitimate claim, it affects snow contractors, it affects businesses because with the increase in premiums, they have to be passed on.”
De Pruis said that unfortunately, insurance fraud exists across Canada and a more coordinated approach is needed to combat it. However, he added, prevention is what’s key right now because scammers are hard to catch.
Jorgenson said he has spoken to other snow removal contractors in Alberta, as well as government officials, for help. He’s hopeful that some kind of legislation will keep insurance rates manageable.
How do you plan to manage your business in the short term? He hopes to optimize his operations and be as efficient as possible.
Unfortunately, he added that he will have to pass on an additional 10 percent cost to his clients.
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