Managing Risky Business: Q3 2022

August 16, 2022

In this issue of Managing Risky Business, read about:

The Claims Picture Since Renewal: Learn about how we’re doing on claims since the beginning of the term and how it measures up to previous years
Progress On 2022-23 Renewals: A status update on where we are with renewals and important upcoming dates for you.
Why Accurate Building Valuations Matter: Learn about why this section of your insurance application matters and how it can affect you if you make a claim.
August Webinar On Improving Your Risk Profile: Read a summary of this webinar, which took place earlier this month, and get a link to the recording and the presentation slides.
Safe Summer Fun: Summer’s here and school is out. This means more kids using playgrounds; barbeques and outdoor special events. We have tips to keep things safe
Online Location For Tenant Insurance Info Has Changed: We’ve moved the online home for tenant insurance information, including from where you order brochures
In the News: Media coverage on recent claims

The Claims Picture Since Renewals

Since our last update, our group’s claims performance has become significantly more challenging. Claims costs and frequency have gone up dramatically compared to recent years past. In the nine months since the start of the term, our program saw a total of 152 claims with an estimated cost of approximately $21.2M. Typically the program averages between 150 to 160 claims over the course of the year; we expect to exceed this range in 2021-22. Claims this term have also been higher cost generally, with three claims that have exceeded $1M.

Chart showing year-by-year comparison of claims costs over the past 5 years. Current year has higher claims costs on average since the start of the term to August 2022.

Fire claims continue to be the most expensive for our program and represent 75% of our payouts. Here again, careless smoking continues to lead the way. In recent years, these preventable incidents represent the bulk of our catastrophic losses – claims where buildings are rendered uninhabitable and often need to be rebuilt from the ground up.

However, fire claims only represent 41% of the total. This year 36% are water claims, with burst pipe claims leading the way. The graphs below show the distribution, coloured based on the type of claim fire (pink), water (blue), weather (green) and other (burgundy).

Should you have a property claim and need help, please view our checklist on the immediate steps to take and visit our webpage about submitting a claim for the steps on how to proceed and important telephone numbers.

Progress on 2022-23 Renewals

The key dates for the renewal of your insurance are:

At this point, you should have returned your renewal application. You may have also attended our webinar in June, Making the Most of Your Insurance Renewal, in which we focused on the coverages that might be necessary for your organization depending on the nature of your business. Earlier in August, we held another webinar that provided an update on the renewal and offered insight into improving your risk profile (details below).

In the meantime, HSC has been working behind the scenes on the group renewal. In June and July, we met with insurers in both the UK and North America. We are now in negotiations with the many insurers who will underwrite our program, discussing coverages; how much risk they’d like to take on; and the fair market premium for it. This is a lengthy process. For more information on how this piece works, check out the story from our January newsletter on how we underwrite our program.

Should you have any questions or concerns, please feel free to contact us!

Email HSC Insurance

Why Do Accurate Building Valuations Matter?

All buildings change in value over time. However, values can rise dramatically for a variety of reasons – capital repairs, renovations, new equipment or other, more unique circumstances.

It is important for you to ensure your building valuations are correct because they determine the coverage you receive should you have a major claim or total loss. If your building is undervalued, you could find yourself in a situation where you need to make up the difference in repairs or restoration work since insurance only covers what you’ve declared. Conversely, if your building is overvalued, you could be paying too much for insurance.

Because building values in Ontario generally rise, HSC automatically increases building values by a small percentage each year. However, this may not be enough (or too much).

To ensure that you’re appropriately covered, building valuations are necessary. Historically, these valuations have been determined by a formal, on-site appraisal. However today you can get what is called a ‘desktop valuation.’ These valuations do not involve an on-site visit but instead use other methodologies and information sources; they are also accepted by underwriters. Because they do not involve a physical examination and a tailored report, using instead other data points, they are considerably less expensive. However, they are equally valid for insurance purposes.

HSC offers building valuation services in partnership with Marsh Risk Consulting. At just $500/building, the valuation comes at a fraction of the cost of a traditional one. The process is simple and usually takes about three weeks to complete.

Find out more about HSC-Marsh Building Valuation Services

August Webinar on Improving Your Risk Profile

Improving Your Risk Profile with HSC’s New Risk Rating Tool and Claims Management Best Practices

On August 9, 2022 HSC hosted an exclusive webinar for our insurance clients on the upcoming renewal and best practices for managing claims. The claims portion of the webinar was delivered in partnership with DKI Canada, one of HSC’s partners for emergency restorations relating to water, fire, and wind damage.

The webinar covered a variety of topics, including:

HSC’s new risk rating matrix
Your upcoming insurance renewal
Common insurance challenges with multi-unit residential dwellings
Best practices to help claims move smoothly
Proactive steps to avoid common pitfalls

Watch the webinar and download the presentation slides

Safe Summer Fun

School’s out and summer is well underway! What better way to enjoy both, and to create a sense of community than by having community barbeques, fun fairs or movie nights? However, these types of events can be risky. If anything goes wrong, your organization can be liable – whether you are the host or not.

Here are some tips and coverages to help you protect residents and ensure everyone has a good time.

Hosts should have Common Room Insurance: Your first step for having events on your property is to require event hosts to get common room insurance in advance. This type of insurance protects resident or third-party hosts (and providers) from liability during one-off special events. HSC’s Common Room Insurance covers events on your property that are both indoors and out, such as:

Common room events serving alcohol or not
Bingo, bridge or movie nights
Family celebrations or receptions
Community dinners, craft shows or bazaars
Meetings, workshops or classes (no alcohol served)
Outdoor barbeques and picnics (no alcohol served)
Religious services and ceremonies

Rates start at just $32/event.

Find out more about Common Room Insurance

Ensure play areas are safe: If your event includes amusements for kids, you’ll want to ensure that there’s uninterrupted adult supervision and any play structures or areas are safe.

Marsh Canada has a tip sheet on inflatable play structures (bouncy castles). It outlines key considerations on insurance and legal requirements; rental company selection; site selection and set-up. The sheet also includes advice on how to properly supervise these structures.

Read the Tip Sheet

The Canadian Playground Safety Institute (CPSI) offers an extensive range of resources, including inspection checklists, information on safety standards, a directory for certified inspectors and links to helpful articles.

Visit the CPSI Website

Practice barbeque (BBQ) safety: The BBQ should be properly placed so that it is at a distance from the main premises or any other obstructions – to avoid the accidental spread of fire – and firmly secured to the ground so it cannot move during cooking. As is the case with stovetop cooking, BBQs should never be left unattended and should be turned off when cooking is complete. To prevent flare ups and fires, tenants should avoid grilling too much food at once and not start a gas BBQ with the lid closed.

Finally BBQs, particularly those that are maintained by the housing provider, should be regularly inspected; gas lines should be checked for leaks and grill and grease trays should be kept clean. To support BBQ safety, providers may consider posting signage or including items in their tenant newsletters relating to proper use of BBQs.

Online Location for HSC Tenant Insurance Info Has Changed

To make things simpler, HSC now has all of its insurance content under one roof. We have retired our standalone tenant insurance website and have updated and migrated the program information material to the HSC main website.

The old web link still works but redirects visitors to the new location of the material. Providers interested in ordering print brochures/posters or having PDF versions, can visit this page: https://hscorp.ca/services/insurance/tenant-insurance/provider-resources/

Should you be asking tenants to get insurance, we strongly encourage you to have them apply online. Applying online is faster and enables tenants to get their certificate more quickly, which is helpful if they are under a tight timeline to show your staff their proof of insurance.

Learn more about Tenant Insurance

Order Program Brochures