Rural residents face spike in fire insurance rates

Rural residents face spike in fire insurance rates

Rural residents face spike in fire insurance rates Residents of North Fork, part of Grand Forks in British Columbia, will see their fire insurance premiums skyrocket due to a shortfall in volunteer fire fighters.
 
The Grand Forks Fire/Rescue Fire Chief, Dale Heriot, spoke to about 50 North Fork residents at the George Evans Fire Hall recently to appeal for new volunteers.
 
According to the Grand Forks Gazette, which covered the event, Canadian fire halls are required to have 15 volunteers, unless they are considered a satellite, which the George Evans Fire Hall is, in which case it can operate with 10 volunteers and maintain its Level 4 rating (“semi-protected”).
 
With less than ten volunteers the Fire Underwriters Survey (FUS) changes the rating to Level 5, creating an “unprotected” status. Brokers are advised to inform clients that this will drive their insurance rates up significantly. The FUS provides data to about 85% of the private sector property and casualty insurers in Canada.
 
As it stands, the North Fork hall only has three volunteer firefighters, leaving a significant shortfall and an intervention by the FUS increasingly likely.
 
Residents living about 8km north of North Fork are expected to be impacted, while residents living closer to town are deemed to be protected by the downtown fire hall.
 
The Gazette reports that average insurance rates for a $300,000 North Fork home are $1,310 at the current semi-protected rating but will rise to $3,290 if the rating drops to unprotected.
 
The town’s problems represent the kind of underwriting challenges commercial brokers increasingly face as they look to protect clients. Brokers in other markets are already studying similar cases to see what if any workaround is possible