Insurance firms pledge small-business help as pressure to address rising rates mounts

Insurance firms pledge small-business help as pressure to address rising rates mounts
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A group representing Canadian insurance companies has launched a team that will help small businesses find affordable coverage as rates rise during the pandemic, but critics expressed skepticism over the move.

The Insurance Bureau of Canada, an association that represents the industry, said Thursday that the team will start its work by focusing on helping the hard-hit hospitality sector in Ontario.

The move comes after business owners and politicians raised concerns over increasing instances of sky-rocketing commercial insurance rates and outright denial of coverage in some cases.

The CEO of the insurance bureau acknowledged the frustration small business owners are facing.

“We have a shared interest in making sure that as many small hospitality businesses as possible in Ontario can find the insurance they need – even in a time of heightened uncertainty and risk,” Don Forgeron said in a statement.

The insurance bureau said the new team, which will begin work next month, will evaluate the needs of the businesses and find them appropriate coverage.

Premier Doug Ford twice warned the insurance sector last week that it could face possible regulation if it did not help businesses.

The Ontario government said that Ford and Finance Minister Rod Phillips organized a conference call with the heads of insurance companies last week to press them to take action.

Phillips’ office said he told the companies the government wants to work with them, but needed to protect small businesses.

“The expectation is to see solutions within days, not weeks,” Phillips said in a statement.

Ontario does not currently regulate commercial insurance, something the Progressive Conservative government said last week that it has not ruled out.

NDP Leader Andrea Horwath said she is skeptical the new measure will help businesses, and also raised questions about its timing — just days after Ford threatened regulation.

The NDP have called for strict rules for the insurance sector to prevent what they see as consumer gouging.

“I suspect, they’re trying to make a make themselves look like they are actually good actors and maybe appease the premier,” she said.

Green party Leader Mike Scheiner said he doesn’t think the move by the insurance sector is enough.

“Many small businesses are upset that for years, they paid their premiums, and then their business interruption insurance claims were denied during COVID,” he said. “I think their business got interrupted in the spring.”

Liberal house leader John Fraser called on the government to take further action to bring commercial insurance rates under control without delay.

“The longer you wait, the more people suffer,” he said. “And we’re in a situation right now where businesses are suffering.”

This report by The Canadian Press was first published October 29, 2020.

Shawn Jeffords, The Canadian Press

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