Fort Frances is weighing whether or not to increase insurance deductibles, but at least one councillor believes a possible increase should be held off a little longer.
During Monday night’s meeting of Fort Frances Town Council, Councillor Wendy Brunetta said council should reconsider the idea of increasing insurance deductibles.
A report to council suggests the property deductible be increased from $15,000 to $25,000, the liability deductible increase from $10,000 to $15,000, and that a request for proposals (RFP) be issued.
“We’re increasing user fees by about two per cent,” Brunetta said.
“This is slightly more than that, so I’m just wondering if we could try to keep all our increases to within a lower percentage. Just so we can manage it when it comes to setting our tax rate during our budget deliberations.”
She said the town clerk recommended that deductibles not be increased.
The issue came to the fore at council’s Oct. 27 meeting when it was recommended by staff that council accept an insurance renewal offer from Intact Public Entities (IPE). The offer was for $478,215 for municipal coverage and $5,651 for airport premises insurance for 2025-26.
IPE’s guidelines suggest the town’s deductible should be $25,000 based on the municipality’s size.
“Thus far have been able to keep it lower at $15,000,” Deputy Treasurer Penny Hutton wrote in a report to council.
“We explored these two options last year and found that the premium savings was minimal and decided it was best to keep our deductibles low for as long as possible.”
Hutton didn’t have figures on this year’s possible savings, but she said the savings last year would have been about $10,000 to increase the deductibles.
“That was why we chose not to,” she said and added that she could get costing information for council.
“Coun. Brunetta, would you like us to get those costs?” Mayor Andrew Hallikas asked.
The town’s insurance is up for renewal in November.
“Given the short timeframe, I’m wondering if it’s even possible to do it if it renews Nov. 1,” Brunetta said.
She asked Hutton if the suggestion is to go ahead with the renewal and then possibly adjust the deductions afterwards.
“My understanding is that, yes, we could make that change, even mid-policy,” Hutton said.
“We could make other changes mid-term. We could add vehicles on, remove vehicles, that type of thing.”
“I would like to look at those numbers, if you could put it together,” Brunetta said.
Hutton said one or two claims to insurance would erase any savings that would be achieved through increased deductibles.
“So you really want to be cautious because we can’t control our claims,” she said.
Just four companies are capable of providing insurance on a municipal level, and hopping around from company to company is a detriment because longevity is a considering factor at renewal time, Hutton wrote in her report.
IPE is the largest insurer in the municipal space, holding 48 per cent of the Ontario market, and is renowned for its expertise in the areas of risk management.
Historically, the Town of Fort Frances has gone through the renewal process every four years, with the last being completed prior to the 2023-2024 renewal term.
Two of the four companies that provide Municipal Insurance in Ontario responded to the town’s RFP, both of which are represented by Westland Insurance.
Coun. Michael Behan asked Hutton what was meant when she wrote in her report that it’s best to keep the deductibles low for as long as possible.
“I’m just curious what the long as possible threshold is where we would consider increasing them down the road,” Behan said.
“Once we increase it, it would be difficult to decrease it afterwards through the insurance company,” Hutton said.
