Harassment risk

LIABILITY RISK How to handle harassment

What your corporate clients can do to reduce their liability risk in case of a toxic workplace…

Despite wishful thinking, bullying or a toxic work culture can happen anywhere, and workplace harassment creates liability risk.

To manage this risk, commercial clients need clear policies on harassment and violence in the workplace, as well as procedures to have complaints investigated, employment lawyers say.

The high-profile resignations earlier this winter of Governor General Julie Payette and her secretary exemplify how workplace harassment allegations can be a risk management issue. Their resignations came shortly after the federal government received a report about allegations of a toxic workplace within the governor general’s office. The report has not been made public; specific allegations made in the media have not been proven or reviewed in court.

What if similar complaints are raised against one of your commercial clients?

“There is all kinds of financial liability” if current or former employees allege they were bullied, harassed, or claim to be victims of violence in the workplace, says Alex Warshick, a Halifax-based lawyer with McInnes Cooper. He was commenting in general and not on the governor general’s office.

“You would like to think, ‘It can’t happen or wouldn’t happen at my organization,’ but that’s just not the case,” Warshick said. “It happens everywhere. Wherever people are required to work together, these types of frictions can occur.”

Financial liability may include damages awarded when employers are sued y by workers over employment practices, Warshick says. Liabilities can also include fines and penalties imposed by courts or human rights tribunals or by occupational health and safety tribunals.

If a person sues an employer alleging they were bullied or harassed by a manager, there could be allegations of vicarious liability on the part of the employer, according to Warshick.

“You want to have a digestible policy that’s clear to employees that, if they bring forward an issue or a complaint, their complaints are confidential and there will be no reprisal for bringing forward the complaint,” he says.

What's needed will depend in part on which jurisdiction regulates your client as an employer. For some, it may be mandatory to have a workplace harassment and violence policy. For provin-

COST OF COVID | FEB 18

Business interruption claims arising from the COVID-19 pandemic are expected to cost Fairfax Financial Holdings Ltd. nearly CAN$300 million, the insurer reported. Fairfax reported US$669 million in COVID-19 losses across all of its insurers in 2020.

BY GREG MECKBACH, Associate Editor

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PREDICTING PROPERTY

DAMAGE | FEB 17 When a record hail storm hit Calgary last June, many restoration contractors compiled claims estimates before the end of July. “There have been five price increases on a lot of those [estimates] since then,” an expert from Peak Services said.

INTELLIDRIVE

cially-regulated employers, regulations vary by province and territory.

New regulations for federally-regulated workplaces took effect Jan. 1. Among them, federally-regulated workplaces now require: 1) confidentiality of all parties involved, including witnesses, throughout the investigation; 2) protection for employees victimized by a third party (for example, an employee harassed by a client); and 3) a competent person to investigate and provide recommendations.

Most workplaces’ safety and employment practices are regulated by the provinces and territories. But some — such as airlines, railways, banks, telecommunications and federal crown corporations — are federally regulated when it comes to employment practices.

Most Canadian provinces have regulations mandating that employers have harassment and violence policies, said Warshick. This means your clients may need to put in place new policies, or amend existing policies, to comply with those regulations. Depending on the jurisdiction, those regulations usually include timelines for investigating and reporting complaints.

An organization should also have an ombudsperson to deal with harassment issues, according to Alexandra Monkhouse, Toronto-based partner with Monkhouse Law Employment Lawyers.

Having an ombudsperson available to discuss concerns with employees on a confidential basis is part of a proper process by which an employee can make a formal complaint about harassment or bullying in the workplace, Monkhouse says. An ombudsperson should not disclose the names of employees who approach him or her.

Large organizations often have an ombudsperson, Monkhouse reports. Smaller companies may opt to contract the role out to a third party service.

RISING DEDUCTIBLES | FEB 16

A large increase in deductibles on condo corporations’ insurance is having a knock-off effect of increasing individual condo owners’ premiums, LowestRates.ca reported. Personal condo and strata insurance rates rose 20% in B.C. and 18% in Alberta.

Vendor: Travelers Canada Target Audience: Auto insurance customers What it Does: Rewards drivers up to 30% off their auto insurance premiums for responsible driving through a usage-based auto insurance mobile app Travelers Canada has released its usage-based auto insurance mobile app, IntelliDrive. The app provides customers with a better understanding of their driving habits. It also rewards them for responsible driving by collecting and assessing data on behaviours such as hard braking, rapid acceleration, speed, distraction, and the time of day they’re driving. Responsible drivers can save up to 30% on their auto insurance premiums at renewal, and new customers can save up to 10% when they enroll. Risky driving habits may result in higher premiums. In addition to measuring driving performance, the app provides helpful resources including: Information about the number of consecutive drives taken without interacting with a smartphone; a dashboard allowing drivers to track their performance and compare it with other drivers in the household; and articles providing tips on safe driving.

BUILDFAX

Vendor: Verisk Target Audience: Canadian insurers What it Does: Provides insurers with more than 1-billion data points related to residential and commercial properties in Canada Verisk has expanded its BuildFax product into Canada. The product provides property condition and history information to insurers, drawing on previously untapped building permit data. Available information includes remodeling, renovation and maintenance activity; major storm updates; solar installations; pool construction; and other characteristics. The product encompasses more than 1-billion data points and is continually expanding. “Insurers are often unaware of changes in the properties they insure, making it difficult for them to make informed underwriting decisions and provide the coverage their customers need,” BuildFax managing director Jonathan Kanarek said when announcing the product. “With our expansion into Canada, we’re providing Canadian insurers with data about what actually occurs in properties over time. Leveraging more than 20 years of proprietary data, we can eliminate the guesswork and help underwriters gain new insights into risks, prioritize investments in inspections, and improve their customers’ experience.”

SPECIAL EVENT LIABILITY PRODUCT

Vendor: CHES Special Risk Inc. Target Audience: Brokers What it Does: Provides coverage for third-party bodily injury and property damage that may arise from an event Managing general agent CHES Special Risk now offers special event liability insurance. Demand for the product is expected to surge once lockdown restrictions ease and event organizers are back at work. Coverage includes third-party bodily injury and property damage that may arise from an event. This may include, but is not limited to, financial losses and bodily injury such as foodborne illness. While this type of insurance is optional, local authorities often require liability policies in excess of $1 million and organizers must comply to get permission to put on events. “A number of insurers have exited this market because of the lockdowns and are unlikely to come back in,” said Gary Hirst, president and CEO of CHES Special Risk. “People are expected to be shopping for this type of specialty coverage and only a few providers are left in the marketplace.”

MGA MERGERS | Feb 11

Exepct more mergers and acquisitions activity between managing general agencies (MGA) in the future, MGA executive Stephen Stewart predicted. Private equity investment is giving MGAs the fiscal tools to make acquisitions.

BIG MOVES SUMMARY

Brokerage hires former SCOR Canada CEO

MARKET INSIGHTS Looking ahead

Aon Q4 2020 Global Market Insights Report

Lussier Dale Parizeau has recruited Joseph El-Sayegh as a new regional vice president.

WHO: Joseph El-Sayegh CURRENT ROLE: Regional vice president, commercial services and practice leader in risk management, Lussier Dale Parizeau P&C EXPERIENCE: More than 30 years, including 20 at SCOR Canada. PROFILE: CEO of SCOR Canada from 2016-20. Electrical engineering degree. Former underwriter for FM Global. Served on the boards of ICLR and IBC.

Joseph El-Sayegh has joined Québec’s largest brokerage, Lussier Dale Parizeau, as regional vice president of commercial services and practice leader in risk management.

El-Sayegh “has a collaborative and open management philosophy combined with a strategic vision that will contribute to Lussier Dale Parizeau’s reputation as a leading provider of insurance and financial advisory services for businesses,” Michel Laurin, Lussier Dale Parizeau’s president and chief operating officer, said of the appointment.

Until February 2020, El-Sayegh was CEO of reinsurer SCOR Canada. He took over the role in 2016. El-Sayegh’s new role at Montreal-based Lussier Dale Parizeau took effect Jan. 11, 2021.

El-Sayegh has an electrical engineering degree from Ecole Polytechnique de Montréal. After graduating, he joined FM Global in Montreal in 1989 as an underwriter and loss prevention engineer.

During the 1990s, El-Sayegh worked in Beirut for Gen Re as Middle East and North Africa branch manager for property facultative. He joined SCOR Canada in 2000.

El-Sayegh holds the Canadian Risk Manager (CRM) and Chartered Insurance Professional (CIP) designations.

El-Sayegh has served on the boards of the Institute for Catastrophic Loss Reduction, the Insurance Bureau of Canada and the Reinsurance Council (Canada).

Mike Van Elsberg has joined On Side Restoration as senior vice president of national services. Van Elsberg was previously deputy senior vice president of western claims ms at Intact Financial Corp., which acquired red On Side in 2019.

PANDEMIC SALES

Alex Barker has joined AXA XL as head of specialty and aviation for Canada. Previously, Barker was senior vice president of the aviation business aviation business for Marsh & McLennan. He has for Marsh & McLennan. He has also worked at AXA XL as a senior also worked at AXA XL as a senior underwriter. underwriter.

RECORDS | FEB 11 Videoconferencing during the pandemic helped brokers ic helped brokers in top-tier brokerages across the country shatter sales ntry shatter sales records for individuals topping the $1-million mark 1-million mark in new revenue, senior brokerage executives reported cutives reported in a recent Canadian Underwriter webinar. binar. John Slattery is the new vice president of condominium and strata accounts for independent claims adjuster Sedgwick’s Canadian operations. Slattery has been with Sedgwick since 2016, most recently serving as executive general adjuster. Pricing is increasing, capacity is shrinking, and deductibles are on the rise in the Canadian property and casualty insurance industry. That’s all thanks to the sharp reduction in interest rates dragging down insurer profitability and investment income, says a recent report from Aon, which includes an assesment of the Canadian P&C marketplace.

“Coverage limitations are being mandated by some insurers, and subjectivities are being required where they have not been in the past,” Aon says in its Q4 2020 Global Market Insights Report. “The Canadian government continues to provide financial support to businesses and individuals impacted by COVID-19 which is, amongst other benefits, serving to mitigate risk and temper underwriting behaviours.”

The report notes the Canadian economy has contracted by 5.4%, citing the Organization for Economic Cooperation and Development. However, the economy is expected to rebound this year as vaccines for COVID-19 make their way through the population. “There is general optimism about the New Normal,” the report states.

When looking at rate increases, many lines have seen jumps of at least 11% and a few — construction, financial lines, and personal indemnity, for example — have crossed the 30% threshold. And it doesn’t matter if they’re small, mid-sized, large or complex placements, Aon reports.

When assessing certain lines, Aon notes that social inflation is affecting auto insurer performance. “Insurers are focused on risk quality. Organizations with unaddressed risk quality issues — or with U.S. trucking exposure — are finding very limited insurer appetite,” Aon says, later adding, “pricing is significantly escalated — even for well-performing risks.”

Social inflation is also impacting the casualty side of the business. Claims costs are increasing. But even where exposures have decreased, insurers are not looking to reduce premiums, since they are focusing on a return to profitability.

TOWING GUIDANCE | FEB 5

Insurance Bureau of Canada (IBC) applauded the Ontario Provincial Police (OPP) for its new towing services guidelines, which provide clear direction to tow truck operators about what kinds of towing are required, and how each of these circumstances should be handled.