Very quickly, Mr. Chair, from what we understand in consultation, insurance companies set premium costs based upon the risk profile of each individual railway. What we understand is that railways would typically pay between $650,000 and $850,000 per year for $250 million in third party liability insurance. For $100 million in insurance, it's approximately $200,000 per year.
We've heard from the short lines as well that they have concerns about their increase in operating costs because of the increases in their insurance premiums, and $200,000 to $650,000 is a significant amount. Some financially vulnerable short lines will have more limited capacity to absorb these additional short costs. To allow them to ramp up to that, we're going to adjust the new requirements so that those requirements would be phased in, as you pointed out, and we'll also get to see how the insurance market adjusts to these increases in demand.
But, Mr. Chair, if I may, this is very important. This is one of the big lessons that we learned out of Lac-Mégantic: that carrying $25 million when you're carrying crude oil is not enough insurance. We took a stand in the Speech from the Throne and we're following through on it.