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Managing Risky Business: Q1 2020

Managing Risky Business: Q1 2020

In this issue of Managing Risky Business, read about:

The Current Claims Picture

By Sarah Baker & Jeffrey Herrle, HSC

In the first four months of our term, we’ve had a total of 40 property claims, costing just under $3M. The types of claims span 14 different categories:

bar chart shows water damage is the most frequent followed by water damage

Given that this part of the term includes winter, it’s not surprising that freezing burst pipe claims lead the way, followed closely by kitchen fires — the third most common claim in our program over the past five years and the leading cause of residential fires in North America.

Property managers and providers can take measures to mitigate these risks. While burst pipes often involve maintenance procedures, controlling kitchen fires is mostly a matter of educating residents on best practices and tips for safe cooking.

Looking at claims in terms of costs, the picture is slightly different:

pie chart shows fire costs and water damage are the highest amounts of money.


As the red and blue shades of the graph indicate, fire and water claims make up the bulk of our claims costs – fire costs being almost double those of our water claims. Claims were split almost evenly between larger and smaller providers.

Liability Claims

Liability claims are less frequent to our program – and thankfully we’ve yet to have any in the current term. However, they do occur from time to time and can be quite costly.

The bulk of these claims in our program relate to slips/trips and falls. Slips are backward falls, which are typically the result of a slippery ground surface (wet, icy or oily surfaces). Trips are forward falls that are the result of an uneven ground surface (missing tiles, potholes, walkways) or an obstruction (e.g. extension cords, uneven floor mats). These accidents typically occur in a few key places:

  • Building entrances, lobbies
  • Hallways and stairwells
  • Laundry rooms / mechanical rooms
  • Outdoor walkways and parking lots


Other areas where we are seeing liability claims include Assault (e.g. shootings, fights on the property) and Property Disrepair/Equipment Malfunction (e.g. exterior wooden steps/kitchen cabinets giving way; elevator malfunctions).

We are currently working towards reclassifying our coding of liability claims so we can improve our tracking and guidance to providers.

Should you have any questions, please do not hesitate to contact us at

Sarah Baker is HSC’s Chief Operating Officer and the lead executive on HSC’s Group Insurance Program. Jeff Herrle is HSC’s Senior Manager of Strategy & Communications and specializes in analyzing insurance claims data.

In the News

By Brian Laur, HSC

Claims in the news

February 2020

January 2020

December 2019

Other Items of Note

In other news, a recent insurance industry report foresees a “complex and challenging” road ahead given climate change risk over the next decade. It notes that unless major investments are made to enhance the resilience of buildings and infrastructure, extreme weather events will bring more damage claims (and costs to insureds). You can read the report here. On a related note in February, the Federation of Canadian Municipalities released a report on the cost of climate change adaptation at a local level. Their analysis determined that “an average annual investment in municipal infrastructure and local adaptation measures of $5.3 billion is needed to adapt to climate change.”

The hard market in insurance, in part driven by climate change, has impacted other parts of the housing sector, where no guaranteed group programs are available. In Fort McMurray, Alberta, it’s threatened the financial security of condo corporations and individual owners.

Finally, while we’ve found that while the legalization of cannabis seems to have made little impact on claims, a recent article by Origin and Cause suggests that this might ‘blow up’ due to amateur, at-home extraction methods. We will keep an eye on this trend.

Brian Laur is HSC’s Claims Manager. He is also available to provide training to groups of providers on practical risk management.

A Helpful Tool for When Property Losses Happen

By Ashley Richards, Richards Advocacy

residents sitting in front of fire truck at night

One of the benefits of implementing a mandatory tenant insurance policy in your building(s) is that it protects both your residents and your organization. For tenants, coverages can help pay for damage to property or temporary living expenses, should they need to leave their apartment due to catastrophes like fires or floods. For housing providers, tenant insurance helps control premiums because claims costs can be re-couped from the tenant’s insurer, if the tenant(s) was negligent in causing the loss.

Activating tenant insurance, however, is a process that is unfamiliar to most tenants. To ensure this moves smoothly and swiftly, it’s helpful to advise insured tenants on what they need to do following a property loss. To this end, I’ve prepared a template letter for housing providers to use in this instance which:

  • Notifies the affected tenant(s) that the loss is being investigated
  • Requests that the tenant to contact their own insurance company to advise them of the claim
  • Helps you obtain information from the tenant on the name of their insurance company and policy number
  • Collects updated contact information for the tenant, if they have been displaced or moved out of the property

Using this letter helps us communicate with the tenant throughout the claims process. In doing so, it also helps speed the overall claims process and settle everything. If you have developed a contingency plan, you may consider including this letter in your process.

Ashley Richards has assisted HSC with a wide variety of property claims since 2015. She has over 10 years’ experience with insurance litigation, including subrogated claims and insurance coverage disputes.

Upcoming Contingency Planning Webinar

By Helen Hassard, HSC

Join us on Wednesday March 26, 12pm (EDT) for an informative session on emergency/contingency planning.

Contingency plans are an integral part of every organization’s overall risk management strategy. An emergency plan does not have to be complex; in many cases a simple plan is sufficient. A basic but well-designed plan will help your staff better manage vital tasks in difficult times, accelerate and organize your response, reduce damage and create a more resilient community.

Brian Laur will walk you through our Contingency Plan Template and Planning Guide, helping your organization develop a plan that reflects the unique needs of your community.

Helen Hassard is HSC’s Manager of Stakeholder Engagement and is responsible for planning HSC events.

Sprinklers Save Lives – We Can Help

By Brian Laur & Jim Kroesen, HSC

At the beginning of February, HSC had a fire claim that involved a wheelchair-bound resident who accidentally set her sleepwear on fire. In most instances, this would have resulted in severe damage to the unit and the possible death of the resident. In this case, the resident was treated for burns and smoke inhalation but lived. That’s because the provider recently installed sprinklers in each of the units. The investigator wrote:

“…the activation of at least two sprinkler heads within [the unit] most likely saved the life of the disabled tenant; it knocked the fire down in the growth stage before the large quantity of energy was released into the interior of the unit from the quantity of stored combustibles within the unit and the three pieces of upholstered furniture…without the activation of the sprinkler heads, the energy that would have been released within the interior of [the] unit would have destroyed this unit as well as the units on either side.”

It is also the opinion of this investigator that the release of that amount of energy would have also caused fire to spread into the attic which would have possibly destroyed the entire roof structure and displaced most if not all tenants within that residential block.

Sprinklers save lives and can minimize property damage. As a result, it’s not surprising that the Province legislated their installation in units of buildings with vulnerable occupancies, including retirement homes and long-term care facilities.

The deadline to install automatic sprinklers in buildings covered by the legislation was January 1, 2019. However, as the Retirement Homes Regulatory Agency noted in January 2020, some retirement homes are still working towards compliance (see last story). In the meantime, some social housing providers – including those housing seniors and with mixed tenancies – are also installing in-suite sprinklers.

Are you interested in installing a sprinkler system? Do you need to meet the compliance requirement under the legislation? HSC Technical Services can help. We’ve provided project oversight on multiple sprinkler retrofit projects, including instances where asbestos testing and abatement was required. Contact us for help!

Jim Kroesen is the Department Manager of HSC’s Technical Services. Brian Laur is HSC’s Claims Manager. He is also available to provide training to groups of providers on practical risk management.

Designated Substances in your Buildings – What is your Responsibility?

By John Neville, WINMAR Property Restoration Specialists, and Stefanie Millon, HSC

What is a Designated Substance?

Asbestos, for example, is a common designated substance found in older buildings. In Ontario, asbestos was widely used in sprayed-on material and in pipe and boiler insulation until 1973. The use of many other asbestos containing materials continued until the mid 1980’s. Other designated substances that may be present in older buildings include Lead, Mercury, Silica, Isocyanates and Arsenic.  If improperly handled, designated substances are known to result in serious health problems such as cancer, genetic defects, organ disease etc.

All designated substances are listed in the Ontario Occupational Health and Safety Act to ensure their use is strictly controlled. You can find a full list of designated substances here.

Owner’s Responsibility

A property owner must provide a Designated Substance Survey (DSS) that clearly identifies any designated substances on his/her property to every contractor and subcontractor that works on the property.

It is important to note that the provincial regulation applies whether or not it is known or suspected that a designated substance will be encountered during a project, repair, alteration or maintenance of a building. It is the responsibility of the owner to ensure that all material that may be handled, disturbed or removed is examined by a qualified consultant to determine whether or not any designated substances are present.

Owners should also ensure that the workers review and sign the report, attesting that they understand its contents. Failure to do could expose an owner to liability for loss or damages, as well as fines under the Occupational Health and Safety Act.

It is important to plan ahead because if a DSS report is not readily available, most contractors will not proceed with emergency work or restoration. This can have a significant impact on timely mitigation and/or create further secondary damage.

Preparing a Designated Substance Survey

The Ontario Ministry of Labour publishes guidelines to assist building owners in identifying potential designated substances and provides direction on how to prepare a DSS.

To prepare a DSS for asbestos for example, a qualified consultant must collect samples of suspect building materials and have them analyzed in accordance with section 3 of Regulation 278/05 – Asbestos on Construction Projects and in Buildings and Repair Operations. Multiple samples are usually required and the results must indicate if asbestos containing material (ACM) has been found or not and if so, indicate if it is friable (easily crumbled) or non-friable condition. Drawings, plans and specifications indicating the location of the ACM must also be provided.

Finding a Qualified Consultant

If you suspect there could be designated substances on your property, it is your responsibility to find a qualified restoration contractor or environmental consultant that can ensure an accurate DSS report is available for all future workers.  Not sure where to find one? The Occupational Hygiene Association in Ontario (OHAO) has a Directory of Consultants to get you started.

Work Safe, Be Safe!

Service Managers: Need Designated Substance Surveys for Area Housing Providers? Take advantage of economies of scale! HSC Technical Services can manage the complete procurement process for this service including determining full scope of work, conducting the public tender process, and recommending a proponent. Contact

John Neville is Regional Vice President at WINMAR Property Restoration Specialists. WINMAR specializes in water damage, fire and smoke restoration services, mould inspection and removal, as well as damage restoration and disaster recovery for residential and commercial properties across Canada. Stefanie Millon is a Senior Communications Advisor at HSC.

Undertaking a Construction Project? You’ll Need Insurance

By Sarah Baker, HSC

construction workers in action

We were recently contacted by a housing provider that was ready to kick off construction and wanted to know if HSC offered insurance programs for construction projects.

HSC does in fact offer what is called an Owner Controlled Insurance Program or OCIP. OCIP is different from another common program of construction insurance, Contractor Controlled Insurance (CCIP). As the names suggest, the key difference is in who controls the insurance – with OCIP you are in control.

OCIP offers other advantages:

  • Broader coverage: CCIP only covers the work of associated with the contractor or project manager. OCIP covers all construction, the owner, contractors, engineers, architects and consultants associated with a given project on a project-specific basis.
  • Lower Costs, Less Administration: By combining everyone’s premiums, the owner can achieve economies of scale that usually result in lower premiums. It also means that you save time verifying and administering coverages because you define coverages, terms and conditions of coverage at the outset
  • Claims Settlement: If you need to settle a claim (particularly those with the contractor), the process is more responsive to you than CCIP.

One tip: if you decide to opt for CCIP, you should ensure that the contractor reduces their project quote because you will effectively be purchasing Builders Risk and Wrap-Up Liability on your project (typically a separate owner’s cost).

Interested in finding out more or getting an Owner Controlled Insurance Program for your construction project? Contact us at today.

Sarah Baker is HSC’s Chief Operating Officer and the lead executive on HSC’s Group Insurance Program.

Updating Monthly OW/ODSP Payments for Tenant Insurance

By Lisa Kotsopoulos, HSC

In our last newsletter, we mentioned that premiums changed on February 1, 2020 for new and renewing HSC Tenant Insurance Program policies.

For the most part, this has been a smooth transition. But as we anticipated, we are starting to notice that monthly payments for some OW/ODSP clients are incorrect. We understand that this is because of how monthly payments are processed.

So we’d like to advise Service Managers that caseworkers should:

  • For policies that renewed on or after February 1, 2020 to now: Verify that the amount deducted each month for the tenant insurance has been updated — $16.60 for Option 1; $21.47 for Option 2
  • Watch for renewal documentation if their clients’ policies have not yet renewed: Updates to pricing will come into effect at the time of their policy renewal throughout 2020

Caseworkers can stay on top of their clients insurance renewals and payments by being added as a contact to their applications or existing files. Please note that this needs to be initiated by the client. Housing residents can call Marsh Private Client Services at 1-866-940-5111 about adding a contact or any other tenant insurance questions.

If caseworkers or Service Managers have any questions about this change, please email

Lisa Kotsopoulos is HSC’s Manager of Organizational Development and Business Improvement.

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