Thunder Bay takes former insurer to claims court

City files lawsuit against its former insurer over flood claim reimbursement

Thunder Bay takes former insurer to claims court

Risk Management News

By Lyle Adriano

The City of Thunder Bay is taking former insurer Ontario Municipal Insurance Exchange (OMEX) to court over a flood claim payment dispute.

The municipality yesterday issued a statement of claim for $30 million with an additional $1 million in damages.

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OMEX was Thunder Bay’s insurer during the 2012 flood, which left hundreds of homes with flooded basements and overwhelmed the city’s sewage treatment plant. The plant’s tunnels and much of its machinery were damaged by water, prompting emergency repairs to get the facility back in operation.

"Extensive repair work had to be done," said city manager Norm Gale.

According to Gale, the total cost of those repairs was approximately $58 million. The figure includes plant-related repairs, emergency response to the facility, as well as operating and capital costs.

"OMEX's claims are that the costs are associated with upgrades that improve the condition of the plant. I would like to note that the insurer did say that the costs were insurable, and it was years after the work had been done that OMEX made that claim."

Gale has confirmed with CBC that the city has already recuperated some of the money from OMEX, but he did not disclose how much.

He also said the city was “disappointed” that it had to resort to a lawsuit to recoup the rest of the funds.

Gale said the work at the Atlantic Avenue Wastewater Treatment Plant had been paid for by the city through various funds.

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