Canadian Underwriter

Where to find new capacity for snowmobiles and other vehicles

February 3, 2022   by Alyssa DiSabatino

Person driving a snowmobile across snow covered ground. There are hills in the background and snowmobile tracks in the foreground.

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Heartland Farm Mutual Inc. is entering the Nova Scotia marketplace for miscellaneous vehicles (i.e., all-terrain vehicles, motorhomes, snow vehicles and trailers) and will adopt the rates and risk-classification system used by IAO.

Nova Scotia Utility and Review Board (NSUARB) approved the insurer’s rate application on Feb. 2.  

Heartland lacks its own data in this new marketplace. Rather than analyzing industry data, Heartland applied to the province’s regulator on Jan. 6 to adopt IAO Actuarial Consulting Services Inc.’s rates and risk-classification system for these vehicles, with some modifications.  

Heartland’s deviations from IAO’s rates and risk-classification system includes a $2,500 deductible for ATVs and snow vehicles, which IAO does not offer. However, IAO has a $2,500 deductible for motorhomes and trailers, which Heartland will adopt.  

Heartland also proposes to introduce a driving record rating variable only for ATVs and snowmobiles, which NSUARB approved. 

IAO provides unique base rates for medium and heavy-sized engines. Heartland, on the other hand, will use a single base rate with a differential for engine sizes. This deviation replicates IAO’s separate base rates.  

And while IAO does not rate ATVs, snow vehicles or motorhomes by territory, Heartland has proposed  and was approved  to include territory as a rate variable for these vehicles. 

Heartland will also introduce several proposed discounts, including a 15% discount to motorhomes and trailers if an insured has both an automobile policy and either a farm policy or a home, tenant or condominium policy.  

The insurer will also provide a discount based on how long the insured has held their policy, starting at three consecutive years or more for a 5% discount, and seven years or more for a 7% discount. They will also provide a 15% discount on snow vehicle premiums when the insured is a member of the Snowmobiler’s Association of Nova Scotia (SANS).  

Heartland will also apply a series of surcharges. They include:

  • a “standalone” surcharge when an ATV or snow vehicle is written without an accompanying vehicle
  • an accident surcharge if the client has two or more at-fault accidents in the previous three years, and
  • a convictions surcharge depending on the number of serious convictions the client has had in the past three years. 

Heartland also proposes to use the “List Price New” of a trailer to assign rate groups for physical damage coverages, as they currently do in Ontario. NSUARB has approved Heartland’s proposal, however, this deviates from IAO, which uses the rate group of the towing vehicle when rating trailers for physical damage coverage.  

Heartland’s automobile insurance will be marketed as The Kings Mutual, following Kings’ merger with Heartland in summer 2021.   


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