Staff Report #1
June 29, 2026
To All Commissioners
Re: 2026 – 2027 General Insurance Program Renewal
Recommendation
That the Commission:
i. APPROVE the general insurance program for the period of June 30, 2026 through to June 30, 2027 at a total annual cost of $3,137,676 exclusive of applicable sales tax and deductible costs, the particulars of which are as follows:
| Coverage | Premium | Insurer |
| Automobile | $ 2,339,380 | Zurich |
| Property | 324,949 | Zurich |
| Liability (General, Abuse) | 91,127 | Zurich |
| Liability (Umbrella) | 280,938 | Marsh Bowring |
| Travel Accident | 1,200 | Industrial Alliance |
| Boiler & Machinery | 7,443 | RSA / XL Catlin |
| Crime | 8,556 | Liberty |
| Directors & Officers | 25,595 | AIG |
| Environmental | 39,913 | Chubb |
| Cyber | 18,575 | CFC |
ii. APPROVE the broker services for the period of June 30, 2026 through to June 30, 2027 with Marsh Canada at a cost of $108,000.
Background
In March of 2026, Administration began the process with Marsh Canada Limited (the Commission’s broker) for the renewal of the general insurance program for the period of June 30, 2026 to June 30, 2027. The most challenging part of London Transit’s insurance program remains the fleet policy. Due to the size and nature of the fleet, there is traditionally a limited number of insurers willing to insure this class of business. As soliciting proposals from alternative carriers is a significant administrative undertaking for both the carrier and insured, marketing of London Transit’s portfolio is not recommended by Marsh every year. Similar to last year, the 2026-2027 renewal plan was to begin early and seek renewal terms from the current carriers, noting if indications were concerning, then further reviews or “marketing” could take place. After these initial discussions, Marsh felt the renewal terms would be quite fair and recommended that focus be directed solely on negotiating with the current providers.
As anticipated by Marsh, overall rates came in very positively, with a slight decline (0.6%) over prior year. Categories seeing reductions included property (2.1%), crime (7.5%), general liability (2.9%), umbrella / excess (4.0%), and cyber (4.0%). The renewal rate for fleet insurance, the largest category accounting for nearly 75% of all premiums, was flat (or no change in rate). The environmental coverage was the lone category with an increase (3.3%), due to the carriers updated assessment of open claim reserves.
This general reduction in rates witnessed over the last two renewals is an indication of a continued softening of the market, and a welcome reprieve from significant rate increases witnessed in the previous six years. Prior to the 2025-2026 renewal period, average annual increases had exceeded 16%.
Although line rates have declined, total premiums for 2026-2027 have resulted in a 4.4% increase. This net increase is due to the expansion of the bus fleet over the prior year, resulting in more buses to insure from both a liability and property value perspective. A slight increase in brokerage fees for Marsh has also been applied (2.8%) in 2026-2027.
The recommended renewal results in an annual premium increase of $137,917 over last year, the details of which are set out in the following table.
| Coverage | 2025-2026 | Premium Increase (Decrease) | Explanation for Increase/Decrease |
| Automobile | $ 2,203,407 | $ 135,973 | 6.2% increase in fleet size, 0% rate impact |
| Property | 311,309 | 13,640 | 6.5% increase in insured values (fleet, buildings & equipment), 2.1% rate reduction |
| Liability (General, Abuse) | 93,885 | (2,758) | 2.9% rate reduction (general liability) |
| Liability (Umbrella) | 292,721 | (11,783) | 4.0% rate reduction |
| Travel Accident | 1,200 | – | |
| Boiler & Machinery | 7,393 | 50 | Increased property limits (valuation) |
| Crime | 9,250 | (694) | 1st of three-year policy, 7.5% rate reduction |
| Directors & Officers | 25,595 | – | Flat |
| Environmental | 38,646 | 1,267 | 3.3% increase in rate for claim reserves |
| Cyber | 19,353 | (778) | 4.0% rate reduction |
| Broker Fees | 105,000 | 3,000 | 2.8% increase in fee |
| Total | $ 3,107,759 | $ 137,917 | 4.4% overall increase |
The expenditure for the insurance program included in the 2026 operating budget anticipated this overall premium increase given the known increase in fleet size, thus no material impacts or variances are expected at year end. These updated rates will be incorporated into the 2027 operating budget set to be tabled in August.
In addition to the premium costs, London Transit historically pays on average between $600,000 and $700,000 annually in deductible costs relating to accident benefits (as required under no-fault insurance) and public liability claims cost. For 2025, deductible costs totaled $639,520, a level consistent with 2024 and the median of the last ten years’ claims.
Annual Deductible Cost History
| Year | Liability | Accident Benefit | Total |
| 2016 | $ 444,083 | $ 282,828 | $ 726,911 |
| 2017 | 510,351 | 134,166 | 644,517 |
| 2018 | 708,368 | 146,115 | 854,483 |
| 2019 | 603,588 | 79,783 | 683,371 |
| 2020 | 456,340 | 116,142 | 572,482 |
| 2021 | 361,566 | 156,466 | 518,032 |
| 2022 | 350,400 | 155,401 | 505,801 |
| 2023 | 705,454 | 55,854 | 761,308 |
| 2024 | 600,391 | 42,983 | 643,374 |
| 2025 | 520,795 | 118,724 | 639,520 |
The roles of adjuster and legal representation have significant influence on the level and extent of deductible payments made, and as such, an understanding of the nature of claims experienced by a transit provider is imperative in order to mitigate payouts to the greatest extent possible. The Commission has a long-standing relationship with ClaimsPro with respect to insurance adjusting services and Shillington McCall LLP for legal representation relating to claims. There are no recommended changes to either the adjuster or legal representation associated with this renewal.
Recommended by:
E.P. (Ted) Graham, Manager of Accounting
Mike Gregor, Director of Finance
Concurred in by:
Kelly S. Paleczny, General Manager