Local residents are being gouged by an agency hired by the Town of Bradford West Gwillimbury to collect funds after devastating fires, said Coun. Mark Contois.
But other councillors argued at a meeting Tuesday evening there is misinformation about the agency’s process and called for a program to educate residents on how it works.
“Some of the residents are quite offended … they’re getting bills in the mail for something they’re already paying for (fire services),” Contois said. “(Fire Marque says), ‘We’re going to put it on their tax bill if the insurance company refuses to pay.’ Why are we gouging our residents? Let’s get their hands out of their pockets.”
From 2015 to 2018, Fire Marque submitted 52 claims, 38 of which have been paid, and the town has received $66,000, according to a staff report.
The town only pays the company its 30 per cent fee once the money has been collected, the report read.
BWG councillors sparred during a Committee of the Whole meeting Tuesday evening about whether to renew a contract with Fire Marque Inc.
The company is essentially a collection agency that files claims with insurance companies on behalf of the municipality to recover money payable for fire department charges under insurance policies and are not payable by property owners.
But if insurance companies refuse to pay, that bill gets put on the resident’s tax bill, which would then force the insurance company to pay. It is a process, however, that can take time and leave residents facing a bill in the short term.
“They’re stuck holding that bill. We don’t waive it,” Coun. Raj Sandhu said.
“(Insurance companies) may still drag their feet. It will put a headache on homeowners in Bradford,” said Rebecca Murphy, the town’s clerk.
She said companies are getting smarter in their policies, some even writing in fire coverage only for areas outside of where the insured property is located, meaning the local municipality would not be eligible to make a claim.
Coun. Gary Lamb said there is an “unbelievable” amount of misinformation about what Fire Marque does.
“If you have an accident, the tow truck driver’s got to get paid. Everybody’s got to get paid,” he said. “They’re a collection agency for us. It’s not all on the taxpayers’ back.”
Across Canada, 104 municipalities use Fire Marque’s services, according to a staff report.
Most commercial and home insurance policies have coverage for fire department charges that range between $500 and $25,000, depending on policy and insurance provider, and is not taken from any proceeds owners would get under their fire insurance policies, read the report.
“This type of coverage for Fire Department Charges has been included in fire insurance policies that are paid for by property owners for years. But in many cases it is never claimed by the property owner and never paid to municipal Fire Departments. It has been somewhat of a windfall for insurers,” read the report.
“Fire departments have typically not had the expertise or resources to initiate such claims.”
Some BWG council members suggested working into the Fire Marque agreement that residents do not have to cover the bill if insurance companies refuse to pay, but Coun. Peter Ferragine pointed out it would not take long for insurance companies to realize they do not have to pay anything if they just wait out the process.
Committee accepted the report, meaning the town will renew its Fire Marque contract, and Town of BWG staff will report back with an update on how the agreement can be amended to educate and assist residents.
Contois was the only committee member to vote against a contract renewal.