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The Guarantee, NAL Insurance combine forces for trucking industry solution in Ontario | Canadian Insurance
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The Guarantee, NAL Insurance combine forces for trucking industry solution in Ontario

NAL provides alternative coverage for drivers who opted out of province’s workplace insurance program

The Guarantee Company of North America is bringing alternative workplace safety coverage to its transportation customers in Ontario through a new partnership with NAL Insurance.

The program is designed for owner-operators who drive their own trucks and have withdrawn from Ontario’s Workplace Safety and Insurance Board (WSIB), which provides no-fault collective liability insurance for employers and loss of earnings benefits for workers.

If owner-operators aren’t covered by the WSIB, an injury connected to the use of the truck could have them going to their standard auto policy for compensation, according to Glenn Caldwell, vice president of sales at NAL Insurance, which insures more than 280 fleets and 8,000 owner-operators in Ontario.

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“The idea is that if an owner-operator opts out of the WSIB, it gives them the right to sue and also gives them a right to file a claim against the statutory accident benefits of the auto policy for motor vehicle injuries only,” says Caldwell in an interview with Canadian Insurance Top Broker.

Reducing these types of claims will help insurers maintain good rates, adds Caldwell.

This is one reason as to why The Guarantee is partnering with NAL Insurance. In going to meet potential transportation clients, the insurer wants to know how that trucking company is managing the risk that can come from owner-operators, according to John Farquhar, a transportation risk solutions specialist at The Guarantee.

“With owner-operators not having proper coverage, [that] is a huge risk to us so by partnering with NAL, we have been able to say that we have a provider here that has a product bar-none and it works very well,” says Farquhar to Canadian Insurance Top Broker.

Owner-operators of trucks are withdrawing from the WSIB because of the inherent cost, according to Caldwell.

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“An owner-operator pays their [WSIB] premium based on gross [income] but then they only get to collect based on net [income]. So even though an owner-operator may have a large gross, they’re only going to collect what they can collect off 85% of their taxable income,” explains Caldwell. “A lot of them have very good accountants and they write a lot of things off so if their net is fairly low, then their benefit payout is very low.”

And so NAL is an option for owner-operators who are contracted to a trucking company that is requiring either WSIB participation or alternative coverage, he says.

The alternative coverage provided by NAL must be administered by the insured trucking company. There are two payment options: owner-operators can pay into the program with NAL providing monitoring compliance and reporting back to the trucking company in question or the trucking company can pay the premiums on behalf of the owner-operator.

“These controls are put in place to minimize the risk associated with opting out of WSIB,” states The Guarantee’s press release.