Walkerton disaster prompted change
Darrell Greer
Northern News Services
Rankin Inlet (Mar 14/01) - Insurance premiums for municipalities are set to take a big jump, and hamlets in the Kivalliq are already looking for help from the territorial government.
A letter from the Nunavut Association of Municipalities (NAM) to the hamlets said that out of 20 insurance companies asked to provide quotes, only one responded.
The letter went on to say municipal legislation does not provide adequate protection from litigation and the Walkerton, Ont., catastrophe sent shock waves throughout the insurance industry.
NAM also attributed blame for the rate hikes to the increase in subrogation from property insurers and tighter market conditions resulting in escalated rates.
New insurance policies will go into effect on April 1.
Arviat senior administrative officer Darren Flynn says his community is looking at a jump to $82,000 from the $57,000 it paid in 2000.
"These are estimates right now, but unless some alternative is uncovered, we're looking at our first excess umbrella liability premiums going from $396 to $2,352," says Flynn.
"We're looking at a 594 per cent increase on one premium alone."
Flynn says the wake of the Walkerton water disaster has left insurance companies extremely nervous about the liability hamlets are potentially at risk for.
"We're looking at raises of five per cent in accident benefits and 10 per cent for aviation, but comprehensive and excess liability coverage are the bulk of the increases.
"Our comprehensive general liability alone is going from $9,199 to $24,745."
Rankin Inlet SAO Ron Roach says his hamlet is looking at a hike of $30,000.
He says Rankin's premiums will increase to $93,000 from the $62,000 the hamlet paid in 2000.
Roach says Rankin is in a different situation than the other Kivalliq hamlets and new premiums should reflect that.
"The bulk of our increase is through the liability premiums and we're being told the biggest reason behind that is the water disaster at Walkerton," says Roach.
"The Department of Public Works is responsible for maintaining the water system in Rankin, not the hamlet.
"We're going to argue the point that because we don't maintain our water system, we shouldn't be penalized for what happened in Walkerton. NAM is working with the GN to lessen the impact, but you can bet this will be a hot topic of discussion during the NAM meetings here April 23-27."
