OTA presses Ontario to rein in Facility Association misuse
The Ontario Trucking Association (OTA) is calling on the provincial government to tighten oversight of the Facility Association, warning the insurer-of-last-resort system is being misused by high-risk carriers and putting pressure on the broader insurance market.
In a letter to Finance Minister Peter Bethlenfalvy, the OTA said systemic loopholes are allowing unsafe fleets to rely on Facility coverage longer than intended, undermining accountability while shifting costs onto compliant operators.
“Facility insurance was never designed to be a long-term solution for carriers that fail to meet basic safety standards,” said Geoff Wood, OTA senior vice president of policy. “Today, the system is being exploited, and ultimately rewards unsafe operators while responsible fleets are forced to shoulder the cost.”
The association said the current framework allows carriers with poor safety records to remain on the road for undefined periods, while safer fleets subsidize the higher risks through pooled insurance costs. It also warned that some of those operators are running beyond Ontario into other provinces and the United States.
Recent rate increases approved by the Financial Services Regulatory Authority of Ontario, effective in June, are intended to curb migration into Facility. But the OTA argues pricing changes alone won’t fix deeper structural issues.
Among the reforms proposed are higher bodily injury premiums to better reflect risk, eliminating the ability for fleets to opt out of direct compensation property damage coverage, and requiring stronger safety and risk management commitments from carriers seeking access to Facility.
The OTA is also calling for tighter controls around driver hiring and mentorship, along with improved data sharing between provincial Facility offices to track the movement of high-risk operators across jurisdictions.
The association said it has worked with stakeholders to address Facility-related concerns since 2019, but new issues continue to emerge.
“To restore integrity to the system, the cost of risk must be accurately reflected,” Wood said. “Without meaningful financial consequences, there is little incentive for unsafe operators to improve their practices.”
The OTA said closer coordination between government, regulators, insurers and industry stakeholders will be needed to ensure Facility returns to its intended role as a safety net rather than a long-term option for high-risk carriers.
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“… but votes are worth more than our safety.”
You’re not wrong there. The biggest obstacle a just and fair transportation market is geography. The majority of illicit carriers are concentrated in riding areas where those votes are pivotal. There isn’t a Political Party, MP, MPP, or MLA in the country that wouldn’t trade safety for votes.
Everyone needs to ask this question: Why should the public subsidize COMMERCIAL FOR PROFIT carriers whose safety records are so poor they cannot acquire affordable open market insurance?
What happens if one of these carriers gets hit with a 1 BILLION dollar judgement? It’s already happened in Florida.
In the normal course of judgements, a commercial entity could get that billion dollar judgement mitigated as being an excessive hardship. However, a country, state, province, or city, cannot avail themselves of that option. See Gillispie v. Miami Township, Ohio. 52,000 residents have to pay a $45 million judgement. (The judgement is the point here, not the case itself.)
In these cases, the facility insurance, backed by the province, would have to pay. The same goes for provinces, like BC, Saskatchewan, and Manitoba, with public insurance. The tax payer is on the hook to pay those judgements.
In short, your insurance premium increases because facility insurance, partially funded by your insurance carrier, insured an unsafe carrier.
Make that make sense.
You are dealing with corrupt people, where they come from that’s how things are done. They come to Canada and all they see is how easy it is to cheat and steal from our society. Time to end the free ride for these people. Facility insurance should be timed, if they cannot get their sh1t together in a year then they lose insurance and are put out of business. Next is opening up multiple companies for these crooks to hide behind. Both levels of government are to blame for this, they know what’s going on but votes are worth more than our safety.