Canada Insurance Law Review

In a priority dispute, an out-of-province insurer was required to respond pursuant to legislative priority scheme

Posted on January 14, 2020 By Meghan Bell
Categories: Coverage

Coseco v Liberty, [2019] ONSC 4918 involved an appeal arising from an arbitrator’s decision concerning the priority provisions found in s. 268 of the Ontario Insurance Act, R.S.O. 1990, c. I-8 (Insurance Act), and whether it applied to an out-of-province insurer for an accident that took place in Ontario.

Justice Nakatsuru upheld the arbitrator’s decision and dismissed the Appeal, finding that the out-of-province insurer whose policy covered the claimant, and who was a signatory to the Power of Attorney and Undertaking (PAU), was bound by section 268 of the Insurance Act in its entirety.

Background

The claimant was a resident of the State of New York; insured under New York motor vehicle insurance policy, GMAC Insurance Company (GMAC).

ABQB: Limitation periods may not always begin when insurers say so

Posted on January 7, 2020 By Amjad Khadhair
Categories: Coverage

Since July 2012, insurers in Alberta have been subject to a statutory requirement to give written notification to insureds/claimants of the “applicable limitation period” when one of four instances arises. The failure to do so may entitle an insured/claimant to an extension of that limitation period on application to the court.

Until recently, the Court of Queen’s Bench of Alberta had not considered the scope of that standard. Was it simply enough to reference a limitation period, with a Proof of Loss form, in response to an insured’s Notice of Claim? Master Farrington in Statt v SGI Canada Insurance Services Ltd, 2019 ABQB 828, recently answered that in the negative.

Insurance brokers, agents and the expansive duty of care

Posted on December 31, 2019 By Omolara Oladipo
Categories: Coverage

Insurance agents and brokers may want to revisit/confirm their practice, especially with policy renewals.

Douglas R. Mah, J. in Duraguard Fence Ltd v Badry, 2019 ABQB 783, found that a failure by an insurance broker to provide adequate coverage was a breach of a duty of care, but NOT a breach of fiduciary duty. The court relied on Fine’s Flowers Ltd v General Accident Assurance Co of Canada Ltd, 17 OR (2d) 529, 1977 CanLII 1182 (ONCA), and G.K.N. Keller Canada Ltd. v Hartford Fire Insurance Co. (1983), 1 C.C.L.I. 34 (Ont. H.C.) for the definition of the duty of care applicable to insurance brokers.

Accident benefit disputes are subject to the discoverability principle: Tomec v Economical Mutual Insurance Company, 2019 ONCA 882

Posted on December 17, 2019 By Susan Fridlyand
Categories: Coverage, D&O and E&O Insurance

The Ontario Court of Appeal in Tomec v Economical Mutual Insurance Company, 2019 ONCA 882, applied the reasoning of the Supreme Court of Canada (SCC) in Pioneer Corp v Godfrey, 2019 SCC 42, to conclude that the discoverability principle applies to statutory accident benefits. What this means for insurers is that they may be required to pay accident benefits past the limitation period articulated in the statute.

Relevant facts

On September 12, 2008, the appellant, a pedestrian, was struck by a motor vehicle. After the accident, the appellant applied to her insurer for attendant care benefits and housekeeping benefits pursuant to s.

Bad faith does not trump jurisdiction in SABs disputes

Posted on December 10, 2019 By Douglas B. B. Stewart
Categories: Coverage, D&O and E&O Insurance

The Court of Appeal for Ontario recently rendered a unanimous decision upholding the broad jurisdiction of the Licence Appeal Tribunal (LAT) to resolve disputes “in respect of an insured person’s entitlement to statutory accident benefits (SABs) or in respect of the amount of SABs to which an insured person is entitled” under Section 280 of the Insurance Act.

In Stegenga v Economical Mutual Insurance Company 2019 ONCA 615, the Court heard the Plaintiff’s appeal of a motion in which her Statement of Claim was struck, as the LAT had exclusive jurisdiction to decide the claim at first instance. The Plaintiff claimed punitive and exemplary damages allegedly as a result of the insurance company’s breach of good faith in failing to inform the Plaintiff that her injuries could be qualified as catastrophic impairment.

Court permits Insured to Appoint Counsel at Insurer’s Expense: Temple Insurance Company v Sazwan, 2018 ABQB 156

Posted on December 5, 2019 By Lovin Narula
Categories: Misc.

In 2018, the Alberta Court of Queen’s Bench (Court) handed down a decision that provided a precedent for an insured to choose its preferred counsel that the insurers will have the onus of financing. This is permitted in certain circumstances only, and requires a reasonable apprehension of conflict of interest.

Background

The Court reached its 2018 decision by way of an Amended Originating Application. In this case, the Applicants were Temple Insurance Company, Aviva Insurance Company of Canada, XL Reinsurance America Inc, Arch Insurance Canada Ltd, Everest Insurance Company of Canada and Lloyd’s Underwriters (Insurers). The Respondents in this action were Clark Sazwan and Denise Sazwan (Sazwans).

Come hell or “high-water”: What damage is covered by the Builder’s Risk policy?

Posted on December 3, 2019 By Dragana Bukejlovic
Categories: Construction and Design

On March 6, 2019, the Court of Appeal of Newfoundland and Labrador clarified the question of whether damage to property during a construction project is covered by the Builder’s Risk policy or the General Liability policy held by a contractor. The answer is; it depends. In Dominion of Canada General Insurance Company v Viking Fire Protection Inc.[1] the three-panel decision written by O’Brien J.A. poignantly begins with:

[w]hen water inadvertently escapes from a sprinkler system during construction, the law of gravity will determine its flow. The law of contract will determine whether the property which is damaged as a result of the flowing water is insured under a policy of insurance.