CORNWALL, Ontario – During the presentation of the municipal budget to Council on Tuesday, Jan. 25, Cornwall Chief Financial Officer Tracey Bailey explained how the City’s insurance costs had again jumped this year.
The 2022 budget document shows that municipal insurance costs have increased by 20.52 per cent or $242,700.
“So many firms exciting municipal industry because the risk is there,” Bailey explained. “Unfortunately, it is what it is. The municipality needs insurance.”
The 2021 municipal budget also saw a steep increase in insurance costs for the City. Councillor Claude McIntosh asked Bailey if these jumps in insurance rates would be continuing.
“I hope we are not going to see this again in 2023 and we don’t know. I can’t tell you,” Bailey said.
Cornwall is not unique among Ontario municipalities when it comes to rising insurance costs. According to the Association of Municipalities Ontario (AMO) most Ontario municipalities saw an increase in their insurance rates for their budgets this year to the order of 20 per cent.
“Municipal insurance and the impact of costs continues to be a major subject of concern for many AMO members. Many municipalities in Ontario are reporting increases to insurance costs of more than 20%. These costs are being driven by a “tight” insurance market, climate change, increased litigation, and other factors that increase claims as well as Ontario’s joint and several liability regime,” AMO explains in a statement on their website dated Jan. 13.
AMO states that it is leading the way in lobbying the provincial government, specifically Caroline Mulroney, the Attorney General, to address the issue of rising insurance premiums.
“Joint and several liability makes municipal governments the insurers of last resort in instances where they are not primarily responsible for an incident. This principle costs municipalities and taxpayers in the form of rising insurance premiums which can lead to service reductions and fewer choices. AMO believes this is unfair to property taxpayers and their communities to carry the lion’s share of a damage award when a municipality is found at minimal fault,” AMO states.