Saint John will become the latest municipality to start recovering some firefighting costs from insurance companies.
Council approved the bylaw last week, despite a letter from the Insurance Bureau of Canada raising concerns about the practice.
Fire chief Kevin Clifford says most people already pay for “insured perils” coverage, which includes fire department expenses that typically range from $1,000 to $5,000.
Clifford says the IBC questioned if it’s fair to treat people who have “insured perils” coverage differently from those who don’t.
“If the people have paid for the coverage then that funding pool is there. If we don’t charge for it, then people are paying for coverage that’ll never be used,” says Clifford. “The inequity is the fact that it will never be used and the insurance companies are collecting it.”
Recovering costs common in other municipalities
Councillor John MacKenzie believes insurance companies are simply afraid of losing sales as some people may choose not to get insured perils coverage.
Clifford reiterated that the city will only make claims against policies that include insured perils coverage, adding they can bill for items ranging from overtime to equipment and even the cost of water.
Mayor Don Darling says recovering some of these costs will help the city deal with some of its financial challenges.
“I did have someone who does insurance adjustment all over the country actually share with me that, in fact, [recovering costs] was very common.”
Clifford says many other municipalities have already adopted this practice and, to his knowledge, it hasn’t created any issues.
