Community associations want 'unfair' insurance problem fixed quickly

Some Ottawa community associations say soaring insurance costs eat into their limited funds for running neighbourhood events, and they want the City of Ottawa to pay for their premiums the way it does for most of their counterparts.

Community associations need insurance for everything they do, such as running outdoor rinks, gardens, and barbecues. Under an arrangement from 2001, the City of Ottawa agreed to keep covering commercial and general liability for 180 organizations that existed before amalgamation.

Any group that came along after that, however, has taken part in a group rate insurance program and is paying their own premiums.

Nobody is going to fundraise for insurance.- Anne Robinson, Manotick Culture, Parks and Recreation Association

Only recently, when rates spiked in insurance invoices, did those 27 organizations realized they operated in a two-tier system. Now they want the city to fix the disparity, and quickly.

"It was a huge shock to the group," said Anne Robinson, president of the Manotick Culture, Parks and Recreation Association.

Her group received an insurance bill for about $2,300, about six times more than what it had paid until a few years ago.

The association isn't getting any extra coverage and has never filed a claim, yet it's paying more with a larger deductible, Robinson said.

City to fix the 2-tier system

The Greater Avalon Community Association in Orléans has existed for 15 years, and it has also seen its general liability insurance jump to $1,663 for the current year, almost five times what it paid in 2019-2020.

Community associations also carry insurance to protect their directors and board members should someone ever be sued. Those costs are also rising, but no community association receives that coverage from the City of Ottawa.

President Rachelle Lecours says the rate hike comes at a time when Greater Avalon has been unable to raise money or hold events during the pandemic. It paid its expensive insurance this year to cover only some summer yoga sessions, she said.

Now, it faces a Family Day event in February with a low amount in its bank account, and might cut the event altogether. It could look for its own insurance provider, but that could be even higher than the group rate.

"It's not fair," said Lecours, of the two different insurance programs for community associations. "We all do our best to provide services for the city. Everybody should be treated the same way."

Coun. Matthew Luloff agrees, and says the city wants to bring all associations under one policy.

"It's important that we're not having two tiers of volunteers," said Luloff, who chairs the committee responsible for recreation, and has groups affected in his Orléans ward.

"It's a big problem and it's one we're committed to solving."

This year, the City of Ottawa will cover premiums for 137 community associations and community gardens for a total of $235,154. Coverage for outdoor rinks falls under a different policy. The city's overall insurance costs have also risen dramatically in recent years, and total $11.9 million for 2021-2022.

City solicitor David White said he intends to recommend a solution to the two-tier problem to city council next spring. 

"Staff have undertaken to review the existing program with a view to maintaining equitable treatment for those groups providing and supporting community services in partnership with the city, while also ensuring appropriate risk management practices are in place to protect the city and taxpayers," White wrote in an email.

Fundraising for insurance

Lecours doesn't want to wait months, or until the 2023 city budget.

She thinks the city should find a way during the current budget process to level the playing field for the post-amalgamation associations. The finance and economic development committee meets on Dec. 7, before the budget rises to full council the following day.

Waiting will put groups like hers under strain, she says. It's a difficult pitch to raise money from sponsors in order to cover insurance costs, she said,.

"Nobody's going to fundraise for insurance," said Robinson, who says donors want to see their money being put into the skateboard ramps in Manotick's Centennial Park, or interpretive panels on pathways.

She worries the spike in insurance costs is demoralizing for people simply trying to improve their neighbourhoods.

"This is just such a block to that kind of volunteering. ... You kind of throw up your hands and go, 'Why try to do this in the community if we're having this kind of challenge?'"