Facility Association, an insurer of last resort, is introducing higher surcharges for trucking companies and owner-operators who travel through specific U.S. states.

A current surcharge is set at 1% per percentage of exposure in the U.S. For example, if 25% of a truck’s mileage is in the U.S., a 25% surcharge applies. But Facility Association will now assign higher surcharges for separate U.S. regions, charging 1.25% or 1.50% per percentage based on exposure in those areas.

“The three regions were divided up lowest risk, medium risk, highest risk,” said Derek Tupling, vice-president – government relations and communications.

That risk considered factors such as: state accident rates, fatalities, and the mix of rural or urban roads; the ratings applied by standard insurers; and judicial outcomes in auto accident cases.

With three exceptions, the states to see the highest surcharge of 1.50% per percentage of exposure are on the eastern seaboard, such as New York, South Carolina, New Jersey, and Rhode Island, he said.

“This is Canada-wide, at least in terms of where Facility Association operates,” Tupling added, referring to which policyholders will see the surcharges.

Facility Association currently provides insurance in Alberta, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Ontario, P.E.I., and Yukon.

The surcharges emerged as part of Facility Association’s ongoing due diligence, Tupling said. “We want to ensure that we’re charging the right premium that reflects the risk of where the truck is actually driving.”