continued on page 8 ONTARIO GRAIN FARMER COVER STORY 7 A RISK-ADVERSE INSURANCE INDUSTRY As a former board member of one of Ontario’s largest farm mutual insurance companies, Quentin Martin, co-owner of Kitchenerarea Cribit Seeds, says the digital era and data analytics have spurred insurance companies to continually assess complex risk. Consequently, they have become “very good at avoiding risk.” “The irony is that, as businesses, we try to use insurance companies to manage our risk—as was [an insurance company’s] original purpose. This includes our farm and agriculture business insurance [for] property, casualty, liability, as well as truck fleets,” says Quentin. “Most Ontario based mutual insurance companies don’t have the capacity, under their reinsurance structure, to write policies on large farms or ag business operations because the total insured value is too high.” Quentin highlights human resources issues as another factor within the insurance industry, in that insurers often struggle to find qualified underwriters who understand large agricultural businesses. “Automating the underwriting process for this sector to be more cost effective is difficult because of the complexity and uniqueness of operations." “Large insurance companies don’t want to mess around in the space because it's too niche. So, yes, agriculture-related insurance is a big issue,” Quentin says, referring to both large crop and livestock businesses. “We spend a lot of money on insurance and spent a lot of time last year changing insurance providers. We have grown and our previous providers have changed their ‘risk appetite’—and we were no longer an appropriate customer.” NO INSURANCE FOR YOUNGER DRIVERS For Craig and Jason Martin—co-owners of Cribit Seeds, Seeds, and CEO and equipment and equipment shop manager, respectively— the difficulty of finding grain truck drivers is compounded by the risk-aversion of insurance companies, particularly regarding younger operators. “Years ago, we could start an individual on a D-class truck, then have them work their way into the A-class vehicles, as ready, without the expense of a third-party training organization,” says Craig. “The new training rules may prevent individuals from pursuing their A-licence in situations where they would be an occasional driver. In our case, if I found the right individual, we would consider putting them through the required training.” Now, says Craig, insurance restrictions rule out most younger drivers for the A-class trucks. In the past, Cribit Seeds dealt with carriers unwilling to insure their summer students on pickup trucks. “One will pay a significant premium to carry a new driver in their early twenties until they have a few years experience,” says Craig, adding his “casual observations” suggest more semi-trailers are “being pulled by farm tractors, where there is very little oversight on this activity.” Cribit Seeds has been able to successfully navigate some of these roadblocks, however. The grain business currently has two dedicated full-time drivers, as well as part time seasonal drivers. Cribit Seeds’ owners also have their licences, meaning the company has a wide enough pool of people to draw from if regular drivers are not available or require flexibility. Without that pool, Craig says transport logistics would be much more complicated. ONEROUS SAFETY REQUIREMENTS Should trucks running short distances and largely seasonally be held to the same standards as daily long-distance highway haulers? According to provincial safety requirements, that is currently the case. According to Jason Martin, one of the concerns from such requirements is the cost to perform these inspections with Ontario’s Ministry of Transportation. “Should trucks running short distances and largely seasonally be held to the same standards as daily long-distance highway haulers? According to provincial safety requirements, that is currently the case.
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