Concerned over safety risks and market imbalance, the Ontario Trucking Association (OTA) is urging the Government of Ontario to take immediate action to strengthen oversight and regulation of the Facility Association (FA) insurance system.
Although FA is intended to serve as an insurer of last resort, systemic loopholes are allowing some high-risk trucking fleets to misuse the program, which is undermining the standard insurance marketplace and enabling carriers with poor safety records to continue operating with limited accountability, OTA stated in a letter to Finance Minister Peter Bethlenfalvy, who has ultimate oversight of the file and whom the association has asked to correct the situation.
“Facility insurance was never designed to be a long-term solution for carriers that fail to meet basic safety standards,” said Geoff Wood, OTA Sr VP, Policy. “Today, the system is being exploited, and ultimately, rewards unsafe operators while responsible fleets are forced to shoulder the cost. That is neither fair nor sustainable and puts road users at risk.”
OTA warns the current system allows unsafe operators to remain on Ontario roads for undefined periods and forces compliant carriers to subsidize higher-risk operators, many of whom operate beyond Ontario into other provinces and the United States.
Although the OTA has worked collaboratively to identify and successfully resolve issues with the FA at multiple points dating back to 2019, additional issues continue to arise which require constant attention and oversight. The Financial Services Regulatory Authority of Ontario (FSRA) recently approved a rate increases effective June 2026 in an attempt to curb the migration to facility, however further, more aggressive actions are needed to act as a meaningful deterrent for high-risk carriers relying on FA as a low-cost alternative.
“To restore integrity to the system, the cost of risk must be accurately reflected,” said Wood. “Without meaningful financial consequences, there is little incentive for unsafe operators to improve their practices.”
In addition to rate adjustments, OTA is recommending to the minister and his team several key reforms in Facility to enhance safety and accountability:
- Further increase bodily injury premiums so that the premium is punitive;
- No longer permit trucking companies to opt out of DCPD coverage;
- Require operators to exhibit a commitment to safety and risk management;
- Implementing driver hiring and mentorship controls in the review process to participate in Facility;
- Data sharing amongst all provincial FA offices be instituted and that insurance regulatory bodies in each jurisdiction be given the authority to take the data trends into consideration so the migration of risk when it occurs between jurisdictions can be accurately tracked and allow for accurate rate increases.
OTA recognizes this is a complex and multifaceted issue which requires close collaboration among all stakeholders; and strengthening alignment between the OTA, the Ministry of Finance, FSRA, Facility Association, insurance brokers, and insurers is essential.
The association looks forward to working with all stakeholders to ensure integrity is restored and FA returns to its intended role.
“It’s critical that safety remains the top priority for Ontario’s trucking industry,” said Wood.