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Snow plow insurance discussion

Discussion in 'Starting a Lawn Care Business' started by JarrodsDad, Jan 19, 2004.

  1. JarrodsDad

    JarrodsDad LawnSite Member
    Messages: 55

    Slip-and-fall lawsuits on the rise; snowplow operators pay more for insurance

    January 18, 2004, EST.

    TORONTO (CP) - A fierce winter, coupled with towering snowdrifts and icy sidewalks, can be a financial windfall for anyone with a pickup truck and a plow on the front.

    But a proliferation of "slip-and-fall" lawsuits in Canada is melting away their profits as snow removal contractors struggle to deal with sky-high liability insurance premiums. "Rates for snowplowers have gone up about 500 per cent over the past two years," said Rocco Scarano, a broker with Dynes Insurance Brokers in Richmond Hill.

    "I've had small operators this winter who couldn't afford the insurance and simply quit clearing snow."

    Bob Clark, manager at Amalgamated Landscaping in Toronto, said his company has had few slip-and-fall cases, but even so, its insurance rates have risen about 30 per cent this year to about $8,000.

    "We just got served last week," he said.

    Catherine Swift, president of the Canadian Federation of Independent Business, said liability insurance rates for small businesses across Canada have been climbing steadily for about two years.

    "We're talking about an annual average increase in costs of around 30 per cent. That's a pretty big hit. There are definitely some that are (closing down) and there are also some operating without insurance," said Swift.

    "But there are a lot more small companies that aren't using the insurance they have because they're afraid to make a claim ... the only reason some carry insurance is for cataclysmic events that could cost millions of dollars. If it's only $50,000, they'll just eat it."

    When it comes to snowplow operators, Swift said slip-and-fall cases are rising and "being driven by litigiousness."

    "Slip and falls are anathema to the snowplowing industry because everybody thinks they should get 30 grand for a slip and fall. These settlements individually aren't huge, but cumulatively, they're hugely costly."

    Mark Yakabuski, Ontario vice-president for the Insurance Bureau of Canada, agrees that the number of slip-and-fall claims are on the rise.

    "I don't doubt some of them are legitimate, but I can only say there's been a proliferation of slip-and-fall incidents," he said.

    "You just have to go to any court today and look at the number of slip-and-fall incidents ... and there's a definite multiplication in the number."

    As a result, snowplowing operations are forced to pay higher premiums for liability insurance, with some reportedly facing increases of up to 40 per cent.

    "The premiums ultimately have to reflect the cost of claims associated with these policies," Yakabuski said.

    That's a painful situation for businesses: in a survey of more than 2,000 small businesses conducted by the CFIB last June, a third responded their profitability has been "significantly harmed" by higher insurance costs.

    Fraudulent personal injury claims are common in the insurance industry, Yakabuski said, but that's only one part of the story.

    "It's not really a case of whether some are fraudulent and not fraudulent; it's probably more a reflection of changing society values," said Yakabuski.

    "There was a time 15 years ago when most of the cases would have been thrown out of court. Today, we seem to be more tolerant of people making these sorts of claims without perhaps understanding that the buck has to stop somewhere and has to be paid, ultimately by everyone who's carrying insurance, especially those in the area of snow removal."

    Ultimately, Yakabuski said, those costs are being borne by insurance companies.

    "Not just the cost of the award ... but there are major legal costs in defending these claims, which are being picked up by somebody's liability policy," he said.

    "Unless governments instruct the courts to limit the kind of lawsuits that can be brought to bear, you're going to see a continued escalation of these claims."

    Swift and the CFIB suggests provinces tighten up legislation and cap personal injury awards.

    "It would be nice if we could see a letup in the litigious approach to seemingly everything under the sun."
  2. tawilson1152

    tawilson1152 LawnSite Member
    Messages: 55

    "Unless governments instruct the courts to limit the kind of lawsuits that can be brought to bear, you're going to see a continued escalation of these claims."
    The governments mainly consist of lawyers so it ain't gonna get any better. Insurance companies love it. Justifies their existence and they just pass the cost along anyways.

    JKOOPERS LawnSite Bronze Member
    Messages: 1,259

    I have experienced the lawsuits and your best thing to do is to write your times when u were there and if you can have someone sign-off on a carbon copy stating that the lot was clear when u left .
  4. 1acreplus

    1acreplus LawnSite Member
    Messages: 32

    Don't know about you guys, but all of my snowcare contracts have an "indemnify and hold harmless" clause that covers slip-and-fall. My company is only liable for direct consequences of action, but not consequences of inaction or indirect consequences, even if informed of those consequences.

    If they don't agree to indemnify you, walk away! There are other, more responsible customers out there.

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