Ontario’s 2023 changes making direct compensation for property damage coverage (DCPD) optional meant Facility Association (FA) “unwillingly [became] the underpriced market of choice for longhaul trucks carrying only liability and accident benefits,” Saskia Matheson, the association’s president and CEO, told FA’s Mar. 11 annual general meeting.

“Not only did this represent a growing burden on our industry, where trucks already well served in the regular market were being moved into FA for cheaper prices,” she said, “but the consequence of inexperienced drivers operating minimally insured vehicles plays havoc both with the trucking industry, and the communities in which they drive.”

FA is a residual market providing insurance for high-risk or hard-to-place customers, and operates as a non-profit, unincorporated association of insurers.

Matheson said that “after extensive efforts,” FA was able work with the Financial Services Regulatory Authority of Ontario (FSRA) on a solution to re-balance that segment.

An FA spokesperson noted the Ontario InterUrban (longhaul trucking) issue created a need to explore options to slow down the growth FA was experiencing.

“Following an extensive process, FA has received approval from FSRA to re-balance the [accident benefits and property damage] AB/PD portion [which are mandatory coverages] of the InterUrban premium,” FA’s Derek Tupling told Canadian Underwriter.

“Effective July 1, 2026, for new business and renewals, the AB/PD [accident benefits/property damage] portion of the InterUrban premium will increase by 40%. Following the implementation, FA will closely monitor its renewals and new business to determine if it is having the necessary effect.”

Addressing Alberta

Later in her remarks, Matheson pointed out market imbalances can also shift the other way. Last year, rules prohibiting placement of certain risks in FA ran up against Alberta’s ongoing rate cap. This led to market restrictions on availability for Section C coverage – an optional Alberta benefit that addresses vehicle damage.

“As a consequence, there were vehicle owners and drivers who needed but could not obtain full coverage,” she told the AGM.  

FA worked with the province’s brokers association, Superintendent of Insurance’s office and Alberta Automobile Insurance Rate Board to introduce changes to FA criteria allowing those underserved customers to find policies in FA.

“We are optimistic that as the Care First model rolls out in Alberta, this measure will not remain necessary,” she added. “In the interim, we focus on ensuring availability while we also address adequate price in the constant work to maintain that balance.”

Other key points from Matheson’s comments at FA’s annual general meeting:

• In 2025, FA oversaw transfer of $1.4 billion in written premiums in the risk sharing pool, up 11% from 2024.
• Last January’s increase in grid prices led to a 21% drop in vehicle counts in the grid pool. Simultaneously, there was an 8% increase in vehicles in the non-grid pool, and a 16% gain in premium. “These numbers reflect greater use of the Alberta non-grid pool in the face of rising industry loss ratios, while in Ontario, we saw a reduction in vehicle counts in the pool as insurers took higher prices to respond to trends in bodily injury losses,” Matheson said.
• For FA’s residual market, the association provided coverage for more than 122,000 vehicles nationwide, reflecting over $520 million in written premiums (63% of the vehicle count and 70% of the premium are non-private passenger risks).
• Premium in 2025 declined slightly from the prior year, although vehicle count increased. Most of that increase came from Ontario and Nova Scotia.
• In Nova Scotia, FA private passenger market share has grown steadily for five years, amid rising claims costs and FA rates being cheaper than many regular markets.