The Rising Cost of Insurance 

The cost of insurance is once again rising in leaps and bounds. The insurance market has for years suffered from underwriting losses during a very competitive market, in which insurance companies competed for increased market share by charging fewer premium dollars for a risk in anticipation that their investments would offset any underwriting loss. During this competitive period local governments benefited from extremely low rates charged for property insurance as well as other lines of insurance. Increases in insurance also reflect a rise in the cost of claim settlements and from large natural losses, such as the "Ice Storm" of 1998, as well as other natural disasters that have occurred around the world, including European floods and tornados and hurricane losses in the United States. The events of September 11, 2001 have also played a significant role in insurance, however insurance rates were rising prior to this terrorist act.

Sport and Recreation increases for 2003 have been rumored to be between 30% and 40%, the cost to insure a small 10 minute Santa Clause Parade in Northern British Columbia was quoted at $750.00, Doctors for Professional Sport have had their insurance cancelled. We have also been advised that a contractor on Vancouver Island, responsible for sewer and water maintenance, a $28,000 a year contract, was quoted $16,000 for liability insurance. MIA has received numerous requests from Water and Improvement Districts for membership in the Association because their cost of insurance has dramatically been increased. MIA is not able to accommodate these requests as set out in the Reciprocal Agreement between members.

What does all this mean to local government? More and more community groups will be approaching local officials with a request that local government insure their activities and events. MIA is not a commercial insurer and we cannot offer insurance beyond the services that are provided by and supervised by local government. MIA itself expects a second year of large premium increases for reinsurance.

Spring Clean-Up Plans

To reduce the potential for accidents to occur member municipalities may wish to consider having their local newspapers do a story on your Spring 2003 clean up plans to remove excess sand from winter road maintenance and the potential for injury to cyclists and scooters, who may injure themselves from their failure to drive with due care.

To protect your municipality from having to contribute to the settlement of an injury claim we strongly suggest that records be kept of when and where municipal crews have operated sweepers and / or where manual clean up operations have occurred. In addition crews should be encouraged to keep an eye open for other potential hazards such as pot holes, damaged sidewalks and missing signs, to name a few and that crews should report these hazards to their supervisor for follow-up. Supervisors should determine whether or not the hazard must be flagged to prevent injuries to the public or scheduled for future repair.

Cause & Effect

 The following list of causes and effects reflect new claims brought against local government in the past 3 months. Cause Effect / Injury