The Ontario Trucking Association (OTA) is developing a proposal to reform how commercial carriers access Facility Association (FA) insurance, aiming to limit long-term reliance on the system and address what it describes as misuse by high-risk operators.

The association said it is working with insurance experts and brokers to finalize the proposal, which it plans to submit to Ontario’s minister of finance within 30 days.

Facility Association is meant to be an ‘insurer of last resort’, providing coverage for operators unable to secure policies in the private market. It functions as a statutory insurance pool made up of every company licensed to write automobile insurance in the province. Premiums, losses and expenses are pooled and shared among insurers based on their market share.

“Facility insurance was never intended to be a permanent landing spot for carriers that fail to meet basic safety standards,” said OTA president Stephen Laskowski in a news release. “Currently, the system is being exploited by fleets playing a dangerous game of ‘whack-a-mole’ to stay on the road. We have seen mass migrations of trucks associated with Ontario-based fleets registering out of province to exploit different insurance loopholes when it suits their needs. As soon as one provincial agency realizes the situation and catches up to them, the operations simply jump to the next, less restrictive regime.”

Under the proposed changes, carriers must be rated to reflect their true safety risk. Those who cannot improve their performance within a defined period should be removed. If they remain uninsurable by the private sector, then they pose too much of a risk, OTA argues.

The association acknowledged challenges that have previously complicated reform efforts, including the need to support new entrants without Canadian insurance history, manage market volatility during tight insurance cycles, and avoid sudden disruptions to the supply chain if large numbers of carriers lose coverage.

OTA said its proposal will aim to balance those concerns by providing a limited window for improvement while preventing repeat offenders from cycling through the system.

“To make this work, we need to build hard fences around the system – rules and timelines that are absolute and cannot be manipulated by anyone,” added Geoff Wood, OTA senior vice president of policy. “By working with insurance experts, we are ensuring our policy is legally sound but uncompromising: the era of using evasive tactics to bypass safety standards is over. Improve your safety or exit the industry.”