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There is a quiet absurdity embedded deep within Canada’s commercial trucking system—one that almost no one outside the industry understands, and even fewer are willing to confront.
It’s called Facility Insurance. And for commercial carriers, it has become a shield for failure.
Let’s be clear about what Facility Insurance was designed to do. In the personal auto world, it serves a legitimate purpose. Society has decided that driving is not optional. If you need to get to work, take your kids to school, or access basic services, you need a vehicle—and by law, that vehicle must be insured. Facility Insurance ensures that even high-risk drivers can obtain coverage. It protects the public from uninsured motorists.
That logic is sound.
But then we applied the same logic to commercial trucking—and that’s where the system breaks.
No one is forced to operate a trucking company. Running a commercial carrier is not a right; it is a privilege. It is a business decision, governed by risk, responsibility, and competence. Insurance, in this context, is not a social safety net—it is a gatekeeper.
And yet, when a carrier fails to meet the underwriting standards of the voluntary insurance market—when insurers, whose entire business is measuring risk, say “no”—we override that decision. We place that carrier into Facility Insurance, effectively saying:
You can operate anyway. The rest of the industry will carry you.
Think about what that means.
A carrier with poor safety performance, weak compliance, or questionable operational practices is not removed from the system. Instead, its risk is redistributed—absorbed by the very carriers who have invested heavily in doing things right.
This is not regulation. It is distortion.
It is a system where:
First, safety erodes. When the market’s natural mechanism for removing high-risk operators is neutralized, those operators remain on the road.
Second, pricing becomes detached from reality. Carriers that should be priced out of existence continue to compete—often undercutting compliant operators who bear the true cost of risk.
Third, accountability disappears. If failure carries no consequence beyond being placed into a different insurance pool, then failure is no longer a deterrent.
This is the uncomfortable truth: Facility Insurance, as applied to commercial carriers, does not protect the public—it protects the least qualified participants in the system.
And it does so at the expense of everyone else.
When Failure Turns Catastrophic
Consider what happens when the system doesn’t just bend—but breaks.
A recent U.S. case, Melissa Dzion v. AJD Business Services & Kahkashan Carrier, resulted in a jury awarding $1 billion following a catastrophic trucking accident.
Strip away the headlines, and a harsher reality emerges.
If a carrier involved in a crash of that magnitude were operating under a facility-style insurance backstop, the outcome would follow a predictable pattern:
Insurers absorb the loss within the pool. Premiums adjust. The burden is redistributed across the system—ultimately landing on the desks of compliant operators who had nothing to do with the failure.
A billion-dollar judgement does not get paid. It gets diluted.
But the more important question is this:
Why was that carrier on the road in the first place?
If the voluntary insurance market had already determined that the risk was unacceptable, then overriding that signal is not an act of fairness—it is an act of negligence.
Facility Insurance doesn’t prevent catastrophe. It postpones accountability long enough for catastrophe to occur.
The Principle We Are Ignoring
There is a fundamental principle at stake here, one that policymakers seem reluctant to acknowledge:
Facility Insurance makes sense where insurance is mandatory for participation in society. It does not make sense where participation itself is optional.
If a trucking company cannot obtain insurance in the voluntary market that is not an injustice. It is a warning. It is the system functioning exactly as it should—identifying risk and signalling that the operator is not fit to be on the road.
Overriding that signal doesn’t solve a problem. It creates one.
A System That Chooses the Wrong Outcome
The question is not whether high-risk carriers deserve access to insurance. The question is why compliant carriers—and by extension, the broader public—should be forced to absorb that risk.
At some point, we need to decide what we value more: universal access to a voluntary business, or the integrity of a system built on safety, accountability, and fair competition.
Right now, we are choosing wrong.
It’s called Facility Insurance. And for commercial carriers, it has become a shield for failure.
Let’s be clear about what Facility Insurance was designed to do. In the personal auto world, it serves a legitimate purpose. Society has decided that driving is not optional. If you need to get to work, take your kids to school, or access basic services, you need a vehicle—and by law, that vehicle must be insured. Facility Insurance ensures that even high-risk drivers can obtain coverage. It protects the public from uninsured motorists.
That logic is sound.
But then we applied the same logic to commercial trucking—and that’s where the system breaks.
No one is forced to operate a trucking company. Running a commercial carrier is not a right; it is a privilege. It is a business decision, governed by risk, responsibility, and competence. Insurance, in this context, is not a social safety net—it is a gatekeeper.
And yet, when a carrier fails to meet the underwriting standards of the voluntary insurance market—when insurers, whose entire business is measuring risk, say “no”—we override that decision. We place that carrier into Facility Insurance, effectively saying:
You can operate anyway. The rest of the industry will carry you.
Think about what that means.
A carrier with poor safety performance, weak compliance, or questionable operational practices is not removed from the system. Instead, its risk is redistributed—absorbed by the very carriers who have invested heavily in doing things right.
This is not regulation. It is distortion.
It is a system where:
- Responsible operators subsidize irresponsible ones
- Safety signals from the insurance market are ignored
- Competitive balance is quietly undermined
First, safety erodes. When the market’s natural mechanism for removing high-risk operators is neutralized, those operators remain on the road.
Second, pricing becomes detached from reality. Carriers that should be priced out of existence continue to compete—often undercutting compliant operators who bear the true cost of risk.
Third, accountability disappears. If failure carries no consequence beyond being placed into a different insurance pool, then failure is no longer a deterrent.
This is the uncomfortable truth: Facility Insurance, as applied to commercial carriers, does not protect the public—it protects the least qualified participants in the system.
And it does so at the expense of everyone else.
Consider what happens when the system doesn’t just bend—but breaks.
A recent U.S. case, Melissa Dzion v. AJD Business Services & Kahkashan Carrier, resulted in a jury awarding $1 billion following a catastrophic trucking accident.
Strip away the headlines, and a harsher reality emerges.
If a carrier involved in a crash of that magnitude were operating under a facility-style insurance backstop, the outcome would follow a predictable pattern:
- The insurer pays only up to the policy limit—typically a few million dollars at most
- The remaining liability—hundreds of millions—falls to the carrier
- The carrier collapses under the weight of the judgement
- The victims recover only a fraction of what was awarded
Insurers absorb the loss within the pool. Premiums adjust. The burden is redistributed across the system—ultimately landing on the desks of compliant operators who had nothing to do with the failure.
A billion-dollar judgement does not get paid. It gets diluted.
But the more important question is this:
Why was that carrier on the road in the first place?
If the voluntary insurance market had already determined that the risk was unacceptable, then overriding that signal is not an act of fairness—it is an act of negligence.
Facility Insurance doesn’t prevent catastrophe. It postpones accountability long enough for catastrophe to occur.
There is a fundamental principle at stake here, one that policymakers seem reluctant to acknowledge:
Facility Insurance makes sense where insurance is mandatory for participation in society. It does not make sense where participation itself is optional.
If a trucking company cannot obtain insurance in the voluntary market that is not an injustice. It is a warning. It is the system functioning exactly as it should—identifying risk and signalling that the operator is not fit to be on the road.
Overriding that signal doesn’t solve a problem. It creates one.
The question is not whether high-risk carriers deserve access to insurance. The question is why compliant carriers—and by extension, the broader public—should be forced to absorb that risk.
At some point, we need to decide what we value more: universal access to a voluntary business, or the integrity of a system built on safety, accountability, and fair competition.
Right now, we are choosing wrong.
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