A fire department operating in Port Hope, Ontario, is reasoning that it can charge homeowners it helps on grounds that their customers’ insurance policies can pay for firefighting services.
In June, Port Hope resident Sarah Orr found her property catching fire. The conflagration started in her driveway, which then spread to nearby bushes. The fire grew large enough to damage the siding on her home and her neighbors’. Two people were hospitalized as a result of the house fire, but the blaze was put out before firefighters arrived on the scene.
Not long after the fire, Orr received a call from Ted Woods of Fire Marque, a fire department company with a presence across Canada that currently has an agreement with the municipality of Port Hope. Orr was told by her insurance company that it was handling everything, so she thought nothing of the call.
On October 5, Orr received a letter from Fire Marque on behalf of the city looking to recover costs from the fire last June—it was a follow-up to the call she took much earlier. The company stated in its letter that “most property owners, when paying their premiums are unaware that coverage for the emergency services of their fire department exists in their policy wordings.”
“I couldn’t believe I was getting a bill for the fire department to come to my house,” Orr told
Northumberland Today.
The letter further explained that the fire department insurance coverage is an “extended coverage and subject to various limitation in your policy, for example some policies have a $500 limit while other policies have more.”
Fire Marque sought to explain in its letter how it could be charging for firefighting services when property taxes are supposed to cover such expenses.
“You are not being charged again,” the letter explained. “Your property taxes pay for the fixed costs of your fire department like the fire hall and its equipment. The additional costs the fire department incurs attending your property are eligible to be recovered through your property policy.”
Fire Marque’s letter also noted that a homeowner’s insurance will not increase as a result of the program.
“Fire Marque Inc. has an agreement with your municipality. This gives Fire Marque Inc. the legal right to collect funds through Indemnification Technology,” the letter detailed.
Northumberland Today reported that Fire Marque claims between $500 and $2,000 from insurers, depending on the homeowner’s policy. The company keeps 30% of the costs paid out, while giving 70% back to the municipality.
“If a claim has not been submitted to your insurance company for damages, a claim for the costs of the fire department’s emergency services will not be submitted,” the company said. “Your municipality wants to make sure that your insurance company honours the coverage that you’ve already paid the premiums on.”
Orr was sent another letter on October 24, detailing that she had to pay a subtotal of $3,631.52 for the fire trucks and firefighters. Actual repair costs to Orr’s home total at $2,341.67.
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