The Facility Association Commercial Underwriting Working Group started meeting in June and will continue working throughout 2019 to review specific technical issues relating to Underwriting Rules and Procedures.
“The goal of the working group’s efforts is to ensure that carriers applying for residual market insurance are treated the same as carriers applying for coverage in the regular market and there is a level playing field with respect to information provided to insurers and the checks and balances that are required in the residual market,” said Geoff Wood, OTA’s Senior VP Policy.
This group was formed based on recommendations stemming from meetings in May between OTA, insurance industry representatives and the Facility Association (FA) executive team which highlighted concerns about a small percentage of carriers and brokers who are misrepresenting themselves when applying for residual market insurance to receive favourable insurance premiums.
When applied for and issued properly, insurance with the FA has a legitimate and important role in supporting the trucking industry. The intent of this review is not to eliminate these legitimate uses, but rather to assess the Residual Market insurance policy framework and ensure proper rating of carriers reflects road safety and fleet responsibility in this market.
The working group’s objectives is to review and provide recommendations in the following areas:
- Facility Association Commercial Underwriting Rules;
- Documentation Requirements;
- Fraud Mitigation Strategy;
- Audit Strategy;
- Enterprise Risk Management – Key Risk Indicators;
- Communications Strategy
Recommendations from the working group will be forwarded to the Facility Association Board of Directors for review and further action. OTA will continue to update the membership on this issue.