Although a Nova Scotia business owner is calling upon the government to step into the middle of his industry’s battle with insurers, brokers argue his plight is nothing but a reality in today’s market.
Michael Kenny, president and owner of PML Transport Limited, feels that auto insurance premiums are not only inhibiting his ability to contract new drivers, but they’re also exacerbating a longstanding shortage in the field, according to CTV News.
Kenny has had to collaborate with local schools in order to find talent, and was able to hire three high-performing drivers in the past six months as a result of these efforts. From an insurance standpoint, they were ideal drivers.
“I've had no incidents on a go-forward basis,” Kenny told CTV News.
Despite this success, Kenny had to halt the hiring process of adding a fourth driver because doing so would have resulted in excessively high insurance premiums.
“Our insurance (company) has informed us that unless we're prepared to take a special policy, pay upwards of a thousand more for this policy, he's to cease driving immediately,” Kenny said. The driver is equally dismayed at this outcome, since he spent $10,000 to obtain a Class 1 driver’s license for the position.
The insurer told Kenny that the cost-prohibitive coverage was due to all the inexperienced drivers on his roster.
“They want two years’ experience, but how do they get it if nobody's going to hire them?” he said. “I've taken the chance, I've worked with the schools and then turn around and it's going to cost, cost, cost me more.”
Although brokers are sympathetic to Kenny’s situation, some tell IBC that the nature of Kenny’s business necessitates the premiums.
“Insurance companies base their price on the acceptability of risk, and the odds of somebody getting in an accident are greater when the driver has less experience,” said Steve Earle, owner of WCL Bauld Insurance in Bedford, Nova Scotia.
Although Kenny hopes to appeal to the government about “being handcuffed” by these policies, Nova Scotia Labour Minister Kelly Regan has stated that she has yet to hear about this as an industry-wide concern.
