In this video, Sovereign Insurance’s expert provides top risk management tips to guide your next client conversation on equipment breakdown.
Transcript:
Hi, I’m Allen Babista, and I specialize in helping Canadian businesses stay resilient by protecting their critical systems from equipment breakdown.
Today, I’m sharing a few tips that can help you guide your clients in managing their risk and protecting what powers their operations.
Tip 1: Conduct a risk assessment and go deeper than usual. It’s important to evaluate all critical systems, HVAC, electrical, automation, and any digitally controlled equipment. Don’t stop there. Look at how environmental exposures might create new vulnerabilities.
Extreme heat, cold, or humidity can all impact equipment performance.
Tip 2. Maintenance is your first line of defense. Encourage clients to stay on top of inspections and servicing. In fact, increasing the frequency of maintenance could be one of the smartest investments they make because preventing a breakdown costs far less than repairing one.
Tip 3. Keep coverage aligned with growth. As businesses expand or add new systems, it’s essential to review and update their coverage. Policy that worked five years ago may not offer enough protection today.
Tip 4. Make sure there’s a solid business continuity plan. When breakdowns happen, and they will, a continuity plan ensures the business can keep moving. It’s not just about equipment. It’s about minimizing downtime and financial impact.
And finally, tip 5. Don’t ignore climate and environmental risks. We’re seeing risks today that weren’t even on the radar a few years ago. Ask your clients.
How would extreme weather impact our electrical systems, cooling equipment, or production lines? Planning for these what ifs is no longer optional. Talk to your Sovereign underwriter for more tools and tips. Thanks for watching.
And remember, the right advice can make all the difference when it comes to protecting your clients from unexpected breakdowns.
Chris Charlton, Assistant Vice-president of Commercial Solutions (Western Region), Sovereign Insurance
There’s a lot keeping business leaders up at night. Among the reasons are economic uncertainty, inflation, supply chain pressures, and rising operating costs, which are all pushing Canadian businesses to reassess their expenses. As clients look for savings, some are turning to their insurance policies — and that, says Chris Charlton, Assistant Vice-president of Commercial Solutions (Western Region), with Sovereign Insurance, is where things can start to unravel.
“In this environment, we’re seeing more businesses trying to manage their absolute cost spend, not just their rates and exposures,” he says. “Insurance gets lumped in with utilities or supplier costs, but that’s a mistake. Insurance is not a commodified item. It behaves very differently — especially when you need it.”
The shift has been real — and it’s especially concerning when insurance is treated like a simple line item on a budget sheet, Charlton adds.
The most common cutbacks
The temptation to cut coverage can show up in subtle ways, says Charlton. “We’re seeing changes around building valuations, stock and work-in-progress, and indemnity periods for business interruption,” he explains. “Some clients are reducing limits or skipping contingent business interruption entirely.”
There’s also a growing trend of questioning the value of specialty coverages. “Is Cyber really essential? Do I need Directors and Officers or Employment Practices Liability? That’s the conversation we’re seeing more of — a shift in mindset around what’s considered ‘core’ and what’s considered optional.”
The challenge, he says, is that these levers — reducing limits, scaling back coverage, or relying on outdated valuations — are easy to pull, but the long-term consequences can be significant.
The real cost of cutting corners
“When a business needs to recover from a loss, the decision to underinsure can create a massive resource drain,” Charlton says. “That includes deductible gaps, waiting periods, and shortfalls from undervalued assets or inadequate indemnity periods.”
The ripple effects go even deeper. “In a tight labour market, your employees are your most valuable asset. If your recovery plan is delayed or underfunded, it puts strain on your team — and that can be devastating to morale, operations, and retention,” he adds.
There’s also reputational fallout. “Underinsurance creates friction in claims. It damages trust. When expectations aren’t met — even if those expectations were never clearly discussed — it reflects poorly on everyone involved.”
From price to value: reframing the conversation
Charlton believes the conversation should be shifted away from cost and back toward value.
“The best tool brokers have is their time,” he says. “If your client interaction is limited to an email at renewal, you’ve missed the chance to add value. But if you take the time to understand [your client’s] evolving risks, you can guide a more nuanced discussion, one that focuses on what’s actually being protected and why.”
He encourages brokers to look for red flags, like static valuations, outdated indemnity periods, and business interruption limits that haven’t changed despite fluctuations in revenue. “Ask yourself, ‘Is this business accurately insured?’ Not under or over — but accurately.”
Supporting smarter risk decisions
As a niche commercial insurer laser-focused on midsize to large industries — including manufacturing, construction and contracting, wholesale, warehousing and transportation, and energy and resources — Sovereign recognizes there isn’t a one-size-fits-all solution.
“We continue to invest in our industry-specific expertise, risk engineering, and localized underwriting — not just to quote policies, but to help brokers and clients protect what matters most,” Charlton says. “Having underwriters who live and work in the same regions as our clients enables us to understand those market nuances — and they’re empowered to make decisions that reflect it.”
Sovereign’s team takes time to explain policy design and coverage trade-offs, he adds. “We’re not here to commodify. We’re here to enable smart underwriting decisions, supported by technology, not dictated by it.”
In today’s climate of complexity and uncertainty, underinsurance isn’t just risky — it’s avoidable, he adds.
“This process doesn’t lend itself to shortcuts,” Charlton says. “It demands attention, time, and nuance. By collaborating with our broker partners, we can turn risk conversations into real-world resilience, and make it easier for Canadian businesses to navigate complexity and avoid costly missteps.”
From rising construction and replacement costs to increased climate-related exposures, there are a range of dynamic factors influencing commercial property premiums across Canada. For brokers, understanding these drivers is key to helping commercial customers manage risk and ensure their coverage continues to meet their business’ evolving needs.
Unsure of which factors can contribute to the cost of insurance for Canadian businesses? The following is an overview of the key operational and market level factors influencing premiums, as well as tactics business owners should consider to improve their risk management strategies.
Operational Factors Affecting Premiums
Business class plays a central role in determining premiums, as some industries face higher risks and may require specialized coverage. For example, restaurants are particularly prone to kitchen fires, often sparked by cooking operations and intensified by grease buildup in poorly cleaned exhaust and ventilation systems. In contrast, condo or strata buildings frequently face water damage claims due to plumbing overflows and maintenance issues—risks that tend to increase with the size and complexity of the building, such as the number of units or storeys.
Claims history also impacts premiums. Insurers generally assess claims over the past five years, but significant older events, such as major fire or flood losses, should also be disclosed. This history informs underwriters of a business’ exposure and overall risk management.
Experience in an industry is correlated by an insurer with the perceived risk and reliability of a business. Established businesses with strong safety protocols and fewer past claims are generally rated as lower risk. In contrast, newer businesses or those with limited experience in an industry may face higher premiums and deductibles due to the perceived higher risks of operations efforts, safety breaches, or not-yet-established risk management programs.
Market-Level Factors Impacting Premiums
Inflation and supply chain issues have driven up repair and reconstruction costs, indirectly impacting commercial property premiums. Brokers should encourage their customers to review their policy limits annually to ensure they are insuring to value, as being under-insured can result in partial claim payments or major shortfalls during a total loss. Business owners should also work with their broker to understand the importance of selecting the right business interruption indemnity period, as often 12–24 months is recommended depending on the size and complexity of operations.
Climate risks and natural disasters are also shifting insurer capacity. While wildfire exposure hasn’t significantly changed rates in Western Canada, it has led some insurers to limit their capacity in those regions. Similarly, areas prone to earthquakes and floods have seen reduced capacity even though pricing has remained relatively stable. Brokers should work closely with their customers to provide accurate and transparent risk disclosures to their insurer to ensure they have appropriate coverage.
Risk Management Strategies
Brokers play a key role in not only ensuring their customer’s coverage aligns with their evolving needs, but also in supporting their customers’ risk management strategies to proactively mitigate loss. One of the most valuable resources available to brokers and business owners is the expertise provided by insurers. Many insurers offer loss prevention services, including on-site inspections before binding coverage, ongoing consultation, and educational resources. Practical tools such as the RiskIntelTM Snow and Ice Removal Logs, Roof Inspection Checklist, and Slip, Trip, and Fall Checklist can also be incorporated into business owners’ daily operations to reduce exposure.
Maintaining detailed maintenance records is another key element of a strong risk management strategy. Business owners should retain maintenance logs for at least two years and store them in a secure, backed-up digital format. These logs serve as important documentation in the event of a claim and reflect a proactive approach to property upkeep, which can influence an insurer’s risk assessment.
Finally, regular policy reviews are critical to ensuring that insurance coverage reflects the current needs and risks of a business. Brokers should meet with their customers at least once a year, or more frequently as needed, to review and adjust coverage limits where required. As factors like the cost of reconstruction, changes in revenue, or updates to business operations shift over time, these reviews help ensure customers remain adequately covered in the event of a claim.
Michel Brosseau, Manager, Loss Prevention, Echelon Insurance
Cargo theft is an ongoing challenge facing Canada’s long-haul trucking industry, resulting in financial losses and disrupting supply chains. In fact, the rate of cargo theft in Canada and the U.S. increased by 27% from 2023 to 2024. As theft becomes increasingly sophisticated, it’s important for fleet operators to recognize potential exposures and to take proactive steps to mitigate risks while understanding how to respond effectively if theft occurs.
Best practices for securing cargo
From full truckloads stolen during transportation to partial shipments taken from storage facilities, cargo theft can occur during any phase of the delivery process. To effectively manage potential exposures, operators should consider taking a multilayered, proactive approach that includes security devices as well as comprehensive driver policies and procedures.
Security devices include, but are not limited to:
Premise security: Secure gates and high-quality fencing are important barriers designed to withstand unauthorized access and should be accompanied by access control systems such as biometric scanners like fingerprint or facial recognition, and RFID-enabled entry points. In addition, operators should consider strategic lighting in key areas such as loading zones and parking lots as well as surveillance cameras to help deter theft.
Enhanced locking systems: The use of heavy-duty pin locks on trailer doors is a simple yet effective measure to secure cargo. These specialized locks are difficult to bypass, offering an additional layer of protection against unauthorized access. To further deter theft, loaded trailers should be parked against buildings or other trailers to prevent access to rear doors, when possible.
Real-time GPS tracking: GPS-monitoring systems enable fleet operators to detect if a truck or its load deviates from the planned route. GPS tracking improves an operator’s ability to respond to a theft event efficiently and enables dispatch to provide detailed information to police.
Dash cameras: Utilizing dash cameras with night vision capabilities can play an invaluable role in identifying theft and providing evidence for police investigations. In addition, if cameras are visible from outside the truck, thieves may be deterred from targeting a vehicle to avoid being recorded.
Policies and procedures to deter cargo theft include, but are not limited to:
Information sharing: Though drivers may not suspect that their conversations at truck stops, over the phone, or online pose a substantial risk, thieves can overhear or see these exchanges and gather a wealth of information about cargo, destinations, and delivery windows. Drivers need to be aware of their surroundings and avoid sharing information about their routes and their cargo.
Background checks: For industries like trucking, background checks are essential when hiring employees who will have access to valuable cargo and sensitive information. Background checks help identify potential risks, such as criminal history or unsafe driving records, and ensure that only qualified, responsible individuals are hired.
Unattended trailers and cargo: Trailers should be continuously monitored or stored in secure, gated facilities when not in transit. When stopping for rest breaks or overnight stays, drivers should park in well-lit, high-traffic areas or truck stops.
Route planning: Predetermined routes should be followed to ensure efficiency and prevent drivers from stopping in unsafe locations. In addition, drivers should work with dispatch to vary their route when delivering cargo to the same destination frequently, as routine travel patterns may make drivers an easier, more predictable target for theft.
Driver training: As theft tactics evolve, trucking operators need to provide ongoing training to ensure drivers are aware of the latest theft mitigation strategies. Loss prevention is a shared partnership between customers, brokers, and insurers. Trucking operators can work with their broker and insurer to access educational tools to support cargo theft prevention and other loss prevention strategies across their operations.
Responding to cargo theft
Equipping drivers with an organized response plan will help ensure that an incident is addressed quickly, minimizing potential losses and increasing the chances of recovering the stolen goods or equipment. If a theft occurs, drivers should immediately contact the police followed by their dispatch team, who will then notify their broker and/or insurer and provide the authorities with key information such as dashcam footage or GPS tracking details.
Mitigating and responding to cargo theft requires a multilayered approach that includes premise security systems and technologies as well as driver screening and ongoing training. While these strategies require an investment of time and resources, these tools can lead to long-term savings from the potential cost of stolen cargo and interruption to business operations. Over time, taking a proactive approach will contribute to building resilience against cargo theft throughout Canada’s long-haul trucking industry.
Colette Taylor, EVP & Chief Operating Officer, Sovereign
In today’s competitive commercial insurance landscape, success isn’t only measured by how long a company’s been around — it’s measured in how it thinks, adapts, and innovates.
After more than 70 years in the industry — and a few reinventions along the way — Sovereign Insurance’s journey has proven one thing: staying relevant requires a challenger mindset.
Rather than playing it safe, the insurer embraced bold thinking – modernizing its products, redefining how it collaborates with partners, and building a culture that values purpose and innovation.
Focus fuels advantage
It’s a mindset that’s equipped Sovereign to think big-picture – and recognize that standing out meant honing in, says Colette Taylor, Sovereign’s COO.
“Rather than trying to be everything to everyone, we chose to be a top niche carrier,” she says.
The company made a deliberate shift to sharpen its focus on midsize to large commercial industries including manufacturing, construction and contracting, wholesale, warehousing and transportation, and energy and resources.
Sharper focus enabled Sovereign to deepen its underwriting expertise and deliver greater value where it matters to their partners and clients the most. This gave the company the foundation it needed to innovate upon.
Innovation reflects adaptability
Because when you think like a challenger, innovation becomes habit — and complacency doesn’t stand a chance.
That’s core to how Sovereign approached modernizing its products in 2023 and 2024, when it launched a new suite of base wording — comprehensive, bilingual, digitally accessible, and customizable. “The goal wasn’t just modernization; it was creating meaningful solutions that reflect the realities Canadian businesses face today,” Taylor says.
These product updates weren’t a one-time effort either — they were part of a larger shift in how Sovereign views its role in a constantly evolving market: proactive, adaptive, and responsive to real-world needs.
Collaboration drives growth
Sovereign’s challenger mindset also reshaped how it collaborates externally.
It redefined relationships with broker partners – moving beyond traditional models to focus on deeper listening, faster responsiveness, and co-creating solutions that anticipate client needs.
“Our claims model, risk engineering services, and program development were directly shaped by what we heard from our partners,” says Taylor.
Programs like Sovereign’s concierge claims and risk engineering for top partners aren’t just service upgrades — they’re evidence of a mindset that prioritizes agility, mutual trust, and meaningful partnership over rigid processes.
Culture builds resilience
Internally, Sovereign’s Employee Value Proposition is another example of challenger thinking at work.
Facing a highly competitive talent landscape and retiring Canadian workforce, Sovereign invested in creating a strong culture where innovation, collaboration, and purpose-driven work could thrive.
“Because market challengers recognize true resilience begins with its people,” Taylor says. “Our partners and clients benefit directly from our talented team. When you like what you do, who you work with, and feel part of building something special, it makes a big difference and it shows up in everything we do.”
Mindset matters most
Reflecting on the company’s rich Canadian history and evolution over the past seven decades, Taylor says the journey hasn’t always been smooth.
“Competing against larger players for talent and market share hasn’t been without its challenges,” she says. “Like the rest of the industry, we’ve faced numerous challenges – from regulatory changes and economic fluctuations to the evolving expectations of clients and partners.”
But challengers know resilience isn’t just about weathering change – it’s about embracing it, she adds.
“Throughout it all, the one constant that has set us apart is our ability to question the status quo and seek out innovative ways to add value. Being future-ready means it’s the intangibles — mindset, culture, relationships — that matter most.”
Looking ahead, Sovereign is poised for growth: focused on leveraging innovation and technology, creating new opportunities for partners and flexible solutions that meet evolving client needs — all grounded in the challenger mindset that brought it here.
“We’re ambitious about doing things better — not just bigger,” Taylor says. “Mindset isn’t something we talk about once a year. It’s how we navigate change every day, and how we’ll keep moving forward.”
According to the Institute for Catastrophic Loss Reduction (ICLR), flooding is the most common weather hazard individuals and businesses will face. Looking ahead, the annual cost of flood damage to homes and buildings in Canada is projected to increase substantially. According to the Canadian Institute for Climate Choices, by mid-century, these costs could amount to over $5.5 billion annually, driven by factors such as extreme rainfall and coastal flooding.
Impact of flooding on businesses
For business owners, floods pose risks to assets such as goods and storefronts and can adversely affect business continuity as well as staff and customer safety. It is imperative for business owners to work in collaboration with their broker and insurer to implement strategies to mitigate potential flood damage.
Unsure of which strategies to implement before, during, and after a flood takes place? Below is a summary of key tactics that should be included as part of an effective flood preparedness and response plan.
Flood preparation
To ease the stress associated with last-minute preparations, measures that can be taken well in advance of a potential flood include, but are not limited to:
Establish a team responsible for developing and implementing a business continuity plan. To get a head start on continuity planning, download the RiskIntelTM Business Continuity Toolkit.
Offer annual training on flood event procedures for all staff involved in building operations and routinely assess policies to ensure they remain relevant based on current business needs.
Apply physical barriers to commercial premises, including sealants around basement windows and ground-level door assemblies. Install window wells and covers to windows that are near or below ground level. Consider installing a sump pump and backflow preventer in basement areas.
Business owners should work with their broker to review their insurance annually, or more frequently as needed, to ensure their coverage meets their overall needs but specifically in the event of flooding. Though most commercial property policies include some level of water damage coverage, flood and sewer backup coverages may contain sub-limits, high deductibles, or be excluded outright for those in high-risk areas and who may need it most. It’s important to review policy details with a broker to ensure the necessary water-related risks are covered adequately.
Impending flood preparation
When a flood is forecasted to occur, there are actions that should be taken to help reduce damage to commercial property including, but not limited to:
Activate and communicate the business continuity plan to staff and follow documented procedures to shut down equipment that may be affected by the flood.
Critical equipment such as fire alarms, fire pumps, and sump pumps should remain operational and connected to an emergency generator, if available.
Relocate any materials susceptible to flood damage, such as electronics or vital business records, to an upper floor.
If instructed by authorities to evacuate, do so as soon as possible. Ensure that all employees are informed about evacuation details.
Flood Recovery
Though returning to a business after a flood can be an overwhelming experience, steps to safely and effectively navigate the recovery process include, but are not limited to:
Avoid entering damaged buildings before their structural integrity is thoroughly evaluated.
Notify local utility companies if power lines are down or gas leaks are detected.
Document property damage and take photos and videos of damaged equipment and stock.
Business owners should notify their broker and/or insurance company of potential losses. To expedite the claims resolution process, requested claim forms should be completed as soon as possible. For guidance on what information to gather and how to report a claim, download the RiskIntel Claims Reporting Checklist.
If water has entered a building, remove it from the premises as soon as possible to reduce damage and contamination using dehumidifiers and submersible pumps.
Brokers and insurers play an important role in supporting customers by providing tailored advice and resources to mitigate damage caused by floods effectively, and by ensuring customers have access to the right support during unexpected incidents.
Navigating the evolving risks of commercial properties means brokers require a proactive approach to helping clients select the right building and adequately safeguard their investment. Jason Ostapeic, Unica Insurance’s Senior Risk Control Consultant, discusses hidden exposures and risk control strategies your clients need to mitigate risks they may not know they have.
As businesses grow and new opportunities arise, many are expanding their footprints.
Whether it’s securing additional warehouse space, upgrading office environments, or investing in a bigger retail plaza, selecting the right commercial property is a critical part of their growth strategy.
By guiding clients through complex real estate decisions and risk management strategies, brokers have an important role to play as trusted advisors.
Understanding Commercial Property Risks
“Businesses may miss crucial exposures when selecting a building,” says Jason Ostapeic, Senior Risk Control Consultant at Unica Insurance. “Not addressing these risks could pose significant challenges down the road.”
Risks often include inadequate sprinkler systems, aging infrastructure like asbestos insulation or outdated plumbing, and tenant-specific risks that leave your clients vulnerable to liability losses.
Aligning Tenant Needs with Property Protections
“Tenant selection is key,” explains Ostapeic. “Understanding what commodities a tenant stores and how their operations align with a building’s existing protections — like sprinkler systems — is vital. Without this alignment, you’re looking at increased risk and potential insurance challenges.”
Changes in building occupancy can also pose significant hazards. For example, a space previously used for metal manufacturing may now store rubber tires — a shift that could render its existing sprinkler system inadequate. Tires are combustible, do not absorb water, and their hollow centers enable fire to spread quickly and produce toxic smoke. These characteristics make firefighting especially difficult. These specific tire-related fire risks require special considerations when managing occupancy changes in any commercial property.
“We often see tenants move in without realizing the building’s infrastructure doesn’t meet their needs,” says Ostapeic.
Aging buildings add further complexity. Corroding galvanized plumbing can lead to costly water damage and mould, while frayed electrical wiring increases the risk of fires. “Clients may not realize that the true cost of a property isn’t just its purchase price but also the investment required to bring it up to safe standards,” notes Ostapeic.
The Importance of COPE in Risk Control
To help brokers and their clients navigate these challenges, Unica reminds brokers to utilize COPE (Construction, Occupancy, Protection, and Exposure) as a best practice to assess and mitigate risks in commercial properties.
“Using COPE as a mental checklist ensures buildings are evaluated for risks before tenants move in,” Ostapeic explains. “For example, we assess construction materials to identify combustible elements, evaluate occupancies for specific hazards, and ensure sprinkler systems are adequate for the intended use.”
Unica provides hands-on risk control expertise, offering guidance to clients on finding buildings that meet their operational needs while conforming to National Fire Protection Association safety codes and standards that addresses considerations such as sprinklers, flammable and combustible liquid storage and life safety codes. This includes helping clients identify risks like aging infrastructure, inadequate fire safety measures, and hazards posed by tenant operations.
“When you consider retail plazas with tenants that cater to seniors — like those with medical offices, pharmacies, or home-comfort retailers — it’s essential to evaluate accessibility and safety features, such as elevated curbs and walkways,” Ostapeic says.
Value of Risk Control Programs
“Many business owners view risk control programs as an added expense or a precursor to higher premiums, but brokers can explain that the true value of these programs lies in identifying exposures that might otherwise go unnoticed,” Ostapeic says.
He adds, “It’s about having a fresh set of eyes to uncover potential hazards your client might not be aware of. These programs help prevent losses that could be devastating, not only financially but also to a business’s reputation.”
Unica’s risk control service is designed to proactively safeguard clients by addressing risks before they turn into costly claims.
Comprehensive Protection for Their Investment
With Unica, your clients can operate in their new buildings confidently, knowing their investments are well protected by a comprehensive insurance offering.
Unica’s Commercial Building Owners Connection™ provides robust protection tailored for owners of office buildings and commercial, retail, and industrial plazas. Key benefits include coverage for rental income, debris removal, mortgage rate guarantee, equipment, and employees.
This protection is backed by Unica’s best-in-class claims experience, ensuring your clients can recover quickly after a loss. Prioritizing response times and communication means over 97 percent of new claims receive contact within the first two hours. “With a dedicated team of technically trained adjusters, Unica is committed to helping brokers protect their clients’ investments and providing peace of mind when it’s needed most,” Ostapeic adds.
What to Tell Your Clients
Helping clients find and protect the right commercial property demands a collaborative approach to risk management. Unica recommends these tips brokers can share with their clients:
Know your tenants: Understanding the operations and needs of your tenants is critical to assessing potential risks. Evaluate how their business activities, storage practices, and occupancy type may impact fire protection, safety, and overall liability.
Develop a Preventative Maintenance Plan: Proactively maintain your property’s critical systems — like plumbing, electrical, and HVAC — to prevent costly failures. Incorporate time/usage-based maintenance schedules and advanced technologies such as sensors to identify risks before they escalate.
Inventory your assets: Keep a detailed list of all equipment and infrastructure in your building, including make, model, serial numbers, and locations. This can help streamline maintenance, repairs, and replacements while ensuring no asset is overlooked.
Prioritize critical equipment and infrastructure: Focus resources on maintaining and upgrading essential systems, like sprinkler systems and safety alarms, to minimize potential disruptions. Pay special attention to aging plumbing and electrical infrastructure, which are leading causes of water damage and fires.
Reduce liability and improve accessibility: Minimize slip, trip, and fall risks by maintaining safe, accessible building environments year-round. This is especially important in winter months when snow and ice add hazards, and even more so where senior citizens will have access. Ensure features in commercial buildings, such as walkways, curbs, and lighting, are suitable for all visitors — especially buildings with medical or retail tenants that attract an aging population. Secure agreements with contractors and tenants that include proof of insurance and being named as an additional insured.
Discover how Unica Insurance can help you protect your clients with tailored commercial coverage backed by claims and risk expertise.
Fleet operations in the construction industry face mounting challenges — from driver shortages and seasonal employment, to the increasing complexity of fleet safety. These dynamics pose significant exposures if they’re not proactively managed, says Jason Ostapeic, Unica Insurance’s Senior Commercial Risk Control Consultant.
“Many smaller construction businesses don’t have dedicated fleet managers or the resources to formally oversee fleet safety,” he says. “If your client has even one regulated vehicle on the road, they should have a fleet safety program in place. It’s not just best practice — it’s essential.”
Why Fleet Safety Matters
Poorly maintained vehicles and underutilized technologies like telematics often lead to inefficiencies. High-risk work environments, evolving sustainability and regulatory expectations, and rising operational costs add further complexity. These factors are often compounded by a lack of driver training, insufficient monitoring, and a lack of comprehensive fleet data, making it difficult for operators to optimize performance and mitigate risks.
By understanding these challenges, brokers can leverage expert guidance to help their construction clients implement fleet risk analysis, develop a robust safety program, and adopt proactive risk management strategies to mitigate risks and improve efficiency in their fleet operations — big or small.
“A well-structured fleet safety program can help reduce accidents, lower repair costs, and help clients save on insurance premiums,” says Ostapeic. “It also protects their reputation and ensures safer roads for employees and the public. Fleet safety isn’t just about compliance; it’s about building a culture of accountability and proactive risk management.”
Ostapeic recalls one organization that did have a cell phone policy, but it was informal and narrowly focused on personal phone use. “One of the company’s drivers was involved in an accident that led to multiple third-party injuries. While the driver was found liable for distracted driving, the company was also held accountable for a settlement because they had no formal, documented driver safety policy in place.”
Building a Strong Fleet Safety Program
The foundation of any fleet safety program is leadership buy-in and clear documentation. Ostapeic emphasizes that these programs must be living documents, continuously updated to reflect new risks and advancements in technology.
“Technology like telematics has become a game changer,” he says. “It allows businesses to track driving behaviours — such as speeding, hard braking, and distracted driving — and provides the insights needed to offer targeted coaching sessions, reduce risky driving behaviours, and ultimately lower repair and insurance costs. But this information is only valuable if it’s reviewed regularly and tied back to a broader safety strategy.”
Key components of a successful fleet safety program include driver selection and monitoring, ongoing driver training, accident reporting and analysis, preventative vehicle maintenance, and incentives for drivers who maintain clean records and demonstrate responsible behaviour.
“Understanding the intricacies of fleet safety and risk management is about more than ticking boxes,” says Ostapeic. “It’s about providing value by protecting your clients’ operations, their employees, and the communities they serve. That’s where Unica can help.”
Leveraging Expert Risk Control and Tailored Solutions
By partnering with Unica Insurance, brokers gain access to expert risk control services and tailored coverage backed by best-in-class claims service — all designed to keep their construction clients moving forward safely.
For construction clients, Unica’s Contractors Connection® offers comprehensive protection tailored for various contractor markets, with coverage for employees, building materials, and equipment.
“At Unica, we go beyond underwriting,” says Ostapeic. “We work directly with brokers to provide hands-on fleet risk assessments and actionable strategies. For smaller clients juggling multiple responsibilities, this support can make all the difference.”
Unica’s dedication to claims excellence is why 98 percent of its insureds are satisfied with their claims experience — yet another reason to trust your best construction clients to Unica. “When claims happen, we prioritize fast response times and transparent communication, ensuring minimal disruption for businesses,” says Ostapeic. He adds that over 97 percent of new claims receive contact within the first two hours.
What to Tell Your Clients
To help brokers guide their construction clients, Unica recommends these actionable steps to mitigate fleet risk:
Hire qualified drivers: Establish a robust driver selection process that includes verifying valid licences, reviewing driver abstracts, and conducting written and road tests.
Provide comprehensive training: Develop onboarding and ongoing training programs focused on defensive driving and high-risk behaviour identification. Include training on safe equipment handling and policies addressing distracted driving and drug and alcohol use.
Implement driver monitoring and feedback: Leverage technology to monitor driving behaviours, optimize route planning, and minimize distracted driving with apps that restrict cell phone use while vehicles are in operation. Telematics and driver abstract reviews can help identify high-risk behaviours like speeding or harsh braking. Regular feedback and coaching sessions based on these insights are key. Following any incidents, conduct post-incident reviews with the driver, HR, and fleet managers to prevent future occurrences.
Establish clear accident reporting procedures: Create a step-by-step process for reporting accidents, ensuring vehicles are equipped with the necessary forms and instructions. This should include contacting a manager, coordinating with towing services if necessary, and notifying the broker to expedite the claims process.
Develop maintenance plans and supportive policies: Establish written policies covering pre-trip inspections, load security, and safe parking practices. Implement preventative maintenance programs to ensure vehicles are road-ready and minimize downtime. Additionally, ensure policies are updated regularly to reflect emerging trends and new technologies, continuously enhancing fleet safety.
Foster a culture of accountability: Encourage drivers to take fleet safety seriously through clear policies and incentives.
By sharing these actionable steps, brokers can position themselves as invaluable partners in their client’s risk management strategies—enhancing operational efficiencies, reducing losses, and fostering a stronger culture of safety in commercial industries and on our roads.
Discover how Unica Insurance can help you protect your best clients with tailored commercial coverage backed by claims and risk expertise.
As Canada adopts sustainable energy solutions, emerging exposures from lithium-ion batteries pose new challenges for your commercial property clients. For brokers, understanding these risks is crucial to safeguarding clients from an evolving threat that many building owners are still unaware of. Jason Ostapeic, Unica Insurance’s Senior Risk Control Consultant, explores this emerging issue and shares risk mitigation insights to help advise your clients.
In an increasingly battery-powered world, lithium-ion batteries are becoming indispensable as Canada embraces greener energy solutions. From powering electric bicycles (e-bikes) and electric scooters (e-scooters) to vacuums and power tools, these batteries are rechargeable and efficient — and becoming more popular in commercial properties, including office buildings, retail spaces, condos, and apartments.
However, their increasing presence comes with new risks that brokers and their property owner clients can’t afford to overlook, says Jason Ostapeic, Senior Commercial Risk Control Consultant at Unica Insurance.
“We’re seeing a spike in fire losses involving lithium-ion batteries, which can cause significant property damage and business interruption. And, unfortunately, they’re putting people’s lives at risk, leaving your building owner clients exposed,” explains Ostapeic.
There have been several incidents involving lithium-ion batteries recently, including an e-bike fire in a Toronto parking garage in October that ignited over 20 other e-bikes and left a woman seriously injured.
According to the Canadian Association of Fire Chiefs, fires caused by lithium-ion batteries are on the rise across Canada. Toronto alone saw a 90 percent increase in 2023, with a total of 55 fires, up from 29 the prior year.
Understanding Lithium-ion Battery Risk
Losses are often linked to either electrical, thermal, or mechanical failures in lithium-ion batteries, Ostapeic says.
“One of the primary concerns with these batteries is thermal runaway. This is when a battery rapidly self-heats, causing a release of stored energy. Factors like the battery’s state of charge, cell capacity, and chemistry all play a role,” he explains.
Not all lithium-ion batteries use the same materials, and their ignitable electrolytes add another layer of risk. “Unlike nickel or lead-acid batteries, the electrolytes in lithium-ion batteries are flammable, making them more prone to fires.”
These risks are particularly pronounced during charging or immediately after a battery is fully charged, often due to internal defects, improper charging, inadequate ventilation, or physical impact.
“Even in storage, external heat or mechanical impacts — like being dropped or hit —can lead to failures and trigger thermal runaway,” he adds.
Improper storage and charging are common risk factors. “We’ve seen incidents where batteries are stored near combustible materials or charged in areas without adequate ventilation. In warehouses and retail plazas, for example, a lack of separate fire-resistant storage can significantly increase risk,” Ostapeic says.
Another growing concern is the use of aftermarket replacement batteries, he adds; for example, replacing a cordless vacuum battery with a cheaper, third-party alternative.
“These batteries often don’t meet the same safety standards as the original equipment manufacturer [OEM], which significantly increases the risk of something going wrong. Such batteries have caused fires in homes and apartments, and these same batteries are being stored or charged in commercial properties,” Ostapeic explains.
When it comes to fire risk, brokers know that commercial buildings with inadequate fire safety measures, such as insufficient sprinkler systems, are highly exposed. But a common oversight in risk mitigation is understanding tenant operations.
“The broker’s client might be the building owner, but it’s the tenant who is storing or using the batteries,” Ostapeic says. “If the building owner isn’t aware of what their tenants are doing, the risk increases exponentially.”
Small oversights can lead to significant losses, Ostapeic says. A single battery failure could result in smoke or fire damage to the entire building.
Comprehensive Coverage, Expert Risk Control
Unica offers a comprehensive solution, including tailored coverage and proactive risk control expertise backed by best-in-class claims service.
“Whether it’s a contractor managing multiple sites, a retail building owner overseeing tenants, or an apartment owner with e-bikes on the premises, we’re committed to helping brokers protect their clients’ unique needs,” Ostapeic says.
Through Unica’s Commercial Building Owners Connection™, clients who own office buildings and commercial, retail, and industrial plazas receive comprehensive protection for their physical assets, business income, liability, and employees.
Unica’s Contractors Connection® provides comprehensive coverage for your clients, their employees, tools, equipment, installation materials, and design or workmanship errors — protecting contractors against losses, damage, and project-related liabilities across Canada.
These features collectively provide commercial property and contractor clients with robust protection against a multitude of risks they face today — including the specific risks posed by lithium-ion batteries — helping to ensure business continuity and financial security.
Peace of Mind When They Need It Most
Beyond protection, brokers trust Unica’s Claims Team to help give their clients peace of mind when the unforeseen happens.
“Transparency, consistency, and empathy are the cornerstones of our claims process,” Ostapeic explains. Unica’s dedicated adjusters handle 97 percent of claims, providing clients with a trusted point of contact to reduce confusion and stress. “Our adjusters are technically trained and certified as IICRC Master Restorers, giving them the expertise to address complex claims while maintaining empathy throughout the process.”
What to Tell Your Clients
Unica recommends the following ways brokers can help their clients mitigate lithium-ion battery risks:
Encourage the use of OEM equipment: Use only manufacturer-approved and CSA-certified batteries and chargers.
Implement proper storage: There should be a 10-foot (3 m) space between stored batteries and combustible materials. Nothing should be stored above these batteries, especially in-rack storage without in-rack sprinkler protection. “For warehouse clients handling defective or returned batteries, ask if they’re storing the batteries in a separate fire-resistant room. Similarly, when talking to apartment or condo owners, ask whether there’s a designated safe storage area for e-bikes and e-scooters.”
Check for adequate ventilation: Charging areas must be well ventilated to prevent batteries from overheating.
Ensure proper charging: Avoid storing batteries above 60 percent charge to minimize thermal risks. Charge batteries at room temperature and away from direct sunlight.
Educate owners and tenants: As part of broker questioning to clients, help building owners understand tenant operations and identify hazards associated with these batteries, and ensure they have risk mitigation in place for tenants. “Awareness is the first step in prevention,” Ostapeic says.
Claims management is a core pillar of the insurance industry. It represents the moment when insurers deliver on their promise to be there for their customers.
But today, insurers face a multitude of challenges that are placing extraordinary pressure on their claims handling processes, including an unprecedented surge in claim volumes, rising fraud, strained resources, and growing consumer demands for seamless digital experiences.
When it comes to verifying customer identities in claims, the need for insurers to modernize, streamline, and secure their digital verification operations to address these challenges has never been more vital, explains JP Mercieca, Commercial Business Development Leader at Interac Corp (Interac).
This past summer saw Canada’s insurers dealing with a record-breaking 228,000 insurance claims, largely due to natural catastrophes like flooding in Ontario and Québec, and the wildfire and hailstorm events in Alberta. That’s a staggering 406% increase over the 20-year average, the Insurance Bureau of Canada reported.
“In addition to handling overwhelming claims levels, many insurers are still grappling with using outdated, manual data collection and verification processes, like mailing cheques or requiring customers to send in void cheques. This not only slows down the claims submission process, but leaves insurers increasingly susceptible to fraud and cyber breaches,” Mercieca says.
The issue is also frustrating many customers and affecting the overall claims experience — potentially impacting customer retention. In fact, claims and settlement issues are the top public complaints in the regulated P&C and auto insurance sectors in Ontario, according to the Financial Services Regulatory Authority of Ontario’s 2021-22 Complaints Report.
It’s not just about pleasing customers and delivering on their promise. Excellent claims service will be a key differentiator for insurers competing in today’s marketplace that’s teeming with insurtechs, Mercieca adds.
Improving the claims experience
Interac VerifiedTM offers a solution to many of the challenges insurers face in validating customer identities and confirming banking details during the claims submission process. By enabling secure digital verification, Interac Verified helps automate key steps, saving time and resources while helping to combat fraud and improve customer satisfaction — ultimately with the goal of retention.
By utilizing reliable digital data sources, such as bank-authenticated systems or secure biometric checks, Interac Verified empowers insurers to quickly and securely verify customer identities.
“Customers can conveniently and quickly confirm their identity through their participating banking app on their mobile device or desktop, helping insurers validate the claimant securely and efficiently,” says Mercieca.
With digital verification, bank account details can be securely accessed in a manner that is user consent driven and can be done in just a few clicks. There’s no need for customers to manually submit void cheques nor for insurers to mail out cheques – processes which can be time-consuming, resource-intensive and vulnerable to errors.
The Interac Verified solution helps significantly mitigate the risk of fraudulent claims by ensuring the right person is receiving the claim payout. “There’s a high level of assurance that the customer is who they say they are, which helps insurers avoid fraudulent claims and deliver faster claim payouts,” adds Mercieca.
Streamlining the critical validation steps in claims processing also enables insurers to focus on delivering a seamless, trustworthy customer experience — which can help them gain a competitive edge in a crowded market.
Helping to deliver a promise
At its core, the claims experience defines the insurance industry. In today’s digital-first world, it must be fast, secure, and convenient.
With Interac Verified, insurers can transform digital verification operations, ensuring they’re well positioned to combat fraud and meet the evolving demands of their customers.
Most of all, it helps insurers build trust and better deliver on their promise to be there for customers when it matters most.
Take a deeper look at how insurance leaders can create digital transformation strategies that meet today’s challenges in Interac’s new report, and see what Interac Verified can do for your business.
®, TM are owned by Interac Corp. Used under licence.
