Municipal insurance costs for next year increased in Tay Township by 1.5 per cent according to a recent report, but came in ‘significantly lower’ than what was anticipated.
The staff report for the 2024-2025 municipal insurance renewal was addressed at a recent council meeting which Mayor Ted Walker introduced by saying: “This could be an interesting conversation.”
Rising municipal insurance for many municipalities had been a concern as the market for insurance companies reduced in number over the years, seeing municipalities as a risk due to natural disasters, climate change, and change of liquidity.
As the township’s insurance expires annually on December 31, council voted in favour of signing onto a municipal insurance renewal proposal provided by BFL Canada Risk and Insurance Services Inc. for 2025, costing just under $605,000 excluding PST.
The 1.5 per cent increase was in comparison to roughly $596,999 last year at an $8,900 difference. During last year’s budget, staff had anticipated there to be an 8 per cent increase 2025 for nearly $51,000 instead; in 2023 that insurance increased by nearly 11 per cent ($53,400).
CAO Andrea Fay, providing an overview of the report, called it “great news”.
Walker further noted a Simcoe County council decision in late November to pass a municipal insurance pool startup for the county’s 16 municipalities as well as the city of Orillia.
“There was a lot of excitement about it,” said Walker, “followed by an hour and a half of discussion.”
“The cost savings for the township are considerable as the years go by, especially in year five. Related to that, most of the municipalities are finding that their insurance rates are down considerably this year, and I think that might be because the word is out that we’re looking.”
As per the county report, Tay Township could potentially see a savings of just over $1 million after five years in the municipal insurance pool, with the county possibly saving nearly $37.7 million in that time.
As noted by Fay and Walker, the catch was that Tay would need to pass the council resolution to join the municipal insurance pool before December 31, as would other municipalities joining in, with a transition of June 1, 2025.
Fay stated that township staff had contacted BFL to look into transition information, and would provide a follow-up report back to council in January.
Coun. Gerard LaChapelle pointed out the structure of the insurance pool within the county report, which he said was interesting.
“If you're ever interested in seeing how the insurance breaks down, I was amazed at how the percentage that goes into pockets and shareholders – and actually what’s part of that money that we invest – actually goes to insurance claims.
“(For competitors), they’re lessening their pocket but they’re still making good money off of it,” LaChapelle added. “I was impressed by that one stat (of the insurance pool) of how when we pay, it’s broken down; there’s only one-third that really goes to insurance claims.”
Walker replied: “Insurance is a very complicated matter, and I (put in) a lot of time spent checking this out, so I think it’s going to be good in the end.”
The 2024-2025 municipal insurance renewal report can be found in the agenda page on the Tay Township website.
Tay council meets for committee of the whole meetings every second Wednesday of the month, and regular council meetings every fourth Wednesday of the month. Archives and livestreams of council meetings are available through the Tay Township YouTube channel.
