Many condominium corporations, apartment landlords and homeowners will have to scramble to find someone to clear their snow this winter as skyrocketing insurance costs force some small operators to lay down their plows in protest.
Those who are staying in the business say clients could pay up to double last year's prices to have their snow cleared, with large parking lots getting hit the hardest. One Toronto-area mall is reportedly paying $400,000, up from $140,000 last year.
But it's not just an issue in Toronto. In Alberta, insurance rates are also driving some people out of the business.
"Some of my subcontractors can't afford the insurance to keep plowing," Scott Forrest of Calgary Landscape Maintenance Ltd. said. He said his insurance costs have doubled in the past three years, and he blamed most of the increase on his snow-removal operation.
"Once you put a plow on your truck, your insurance rates just go way up," Mr. Forrest said.
Even with the first flurries dusting the Toronto area in recent days, Jonathan Sutherland says he is getting out of the snowplow business because his insurance bills have shot up 30 to 40 per cent.
Mr. Sutherland, who owns Erinway Greenscaping, a landscaping business in Oakville, said insurers also add a snow-clearing surcharge of about $1,500 to the basic price of about $10,000 for a small business of his size.
"The snow [insurance]is ridiculous," Mr. Sutherland said. "And it's absolutely got to the point this year where I've stopped doing snow removal. And I know a lot of companies are doing the same thing."
Mr. Sutherland, who adds that his auto insurance alone has jumped 20 per cent, said he would normally keep two of his five trucks out in the winter for snow removal. Like many snow removers, he runs a landscaping business in the summer, when he has about 10 employees. For now, he says, he is going to stick to the warmer side of the business and leave snow removal to someone else.
"You just can't make any money at it," he said.
Some lone operators -- a driver with a truck and a plow -- may try to work this winter without insurance, Mr. Sutherland said.
Industry observers blame the situation on the pinch that the entire insurance industry is feeling. Also, accident claims against snow removers have increased. People file suit after they slip and fall on a site the remover is contracted to clear.
"What happens generally is high-risk activities are finding it difficult to get insurance in the regular market," said Mark Yakabuski, Ontario vice-president of the Insurance Bureau of Canada.
Until the government moves to control the rising health-care costs and increasing number of lawsuits that plague the auto-insurance business, the problem will only get worse, he said.
The snow-removal business is also cursed with a history of one-sided contracts that have the snow-removal company facing all of the liability for accidents that take place on the site to be cleared, said Robert Kennaley, a lawyer hired by an industry group to draw up a new standard contract that distributes the risk more evenly.
While some small operators may be giving up, the insurance rates are hitting bigger businesses, too. Bob Wilton, president of Clintar Groundskeeping Services, one of Ontario's largest private snow-removal firms, says his insurance costs have gone up 200 per cent.
"We've had to substantially jack up our prices, and it's all to do with the slip-and-fall liabilities," he said, adding that rates are going up by 25 per cent to 100 per cent industry-wide.
Mr. Wilton said the average contract for a house driveway runs from $300 to $800 for the year, whether it snows or not. Apartment buildingsnow cost around $6,000 to $7,000.