City ends agreement with controversial service line warranty program
Some residents infuriated by city-branded mail-outs from private company
The City of Ottawa is ending its agreement with a company offering insurance-like plans for damaged service lines, after councillors received repeated complaints from residents about the company and its city-branded mail-outs.
In a Monday afternoon news release, the city cited significant growth in warranty services and insurance coverage as reasons for terminating its agreement with Service Line Warranties of Canada (SLWC), a subsidiary of the U.K. multinational corporation HomeServe that provides plans to cover repairs of water and sewer lines that connect homes to city pipes.
In October 2023, council asked city staff to renegotiate the city's agreement with SLWC to prohibit direct mail to residents or, failing that, end its agreement with the company altogether.
At the time, councillors described receiving dozens of complaints about use of the City of Ottawa logo on SLWC mail-outs, alleging it gave the impression it's a city program — and perhaps an obligatory one — even though it's optional.
Despite the complaints from councillors and residents about the phony appearance of the letters, the program isn't a scam.
SLWC had permission to use city logo
City staff previously said SLWC had covered 449 repairs since 2020, saving residents upwards of $580,000. More than 5,100 people signed up, according to the city's water utility and customer services manager Brian Simpson.
The city green-lit the agreement with SLWC in 2016, though some councillors later told CBC they were unaware what they had voted for.
Nonetheless, the city eventually entered the agreement in 2020, giving SLWC permission to use the city's logo, while the city received five per cent of all revenues from SLWC sales in Ottawa. The city extended the agreement in 2022.
In a memo to council, the city's general manager of infrastructure and water services Tammy Rose said "significant growth" in the industry allowed the city to terminate its contract with SLWC.
"Ending this agreement is not a reflection of the services offered by SLWC and will not impact existing policies," the memo reads.
"It is important to note that the use of the City logo or corporate endorsement by SLWC will no longer be authorized."
The city provided its 30-day termination notice Monday.