The Ontario Trucking Association (OTA) is calling on the provincial government to tighten oversight of the Facility Association, warning the insurer-of-last-resort system is being misused by high-risk carriers and putting pressure on the broader insurance market.
In a letter to Finance Minister Peter Bethlenfalvy, the OTA said systemic loopholes are allowing unsafe fleets to rely on Facility coverage longer than intended, undermining accountability while shifting costs onto compliant operators.
“Facility insurance was never designed to be a long-term solution for carriers that fail to meet basic safety standards,” said Geoff Wood, OTA senior vice president of policy. “Today, the system is being exploited, and ultimately rewards unsafe operators while responsible fleets are forced to shoulder the cost.”
The association said the current framework allows carriers with poor safety records to remain on the road for undefined periods, while safer fleets subsidize the higher risks through pooled insurance costs. It also warned that some of those operators are running beyond Ontario into other provinces and the United States.
Recent rate increases approved by the Financial Services Regulatory Authority of Ontario, effective in June, are intended to curb migration into Facility. But the OTA argues pricing changes alone won’t fix deeper structural issues.
Among the reforms proposed are higher bodily injury premiums to better reflect risk, eliminating the ability for fleets to opt out of direct compensation property damage coverage, and requiring stronger safety and risk management commitments from carriers seeking access to Facility.
The OTA is also calling for tighter controls around driver hiring and mentorship, along with improved data sharing between provincial Facility offices to track the movement of high-risk operators across jurisdictions.
The association said it has worked with stakeholders to address Facility-related concerns since 2019, but new issues continue to emerge.
“To restore integrity to the system, the cost of risk must be accurately reflected,” Wood said. “Without meaningful financial consequences, there is little incentive for unsafe operators to improve their practices.”
The OTA said closer coordination between government, regulators, insurers and industry stakeholders will be needed to ensure Facility returns to its intended role as a safety net rather than a long-term option for high-risk carriers.
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