Insurance Coverage Denied??
Alberta Courts recently denied the insurance coverage of a catastrophically injured individual.
This case was dismissed during a summary judgment application initially. This case dealt with a 16 year old Plaintiff who was a passenger involved in a single vehicle accident. It turned out the driver of the vehicle did not have consent to drive the vehicle and then caused the accident. Given that consent over the use of the vehicle was an issue, insurance coverage on the vehicle would be unlikely to follow. As such, the injured Plaintiff sued her parent’s automobile policy.
Each automobile policy that one holds in Alberta contains an SEF 44 – Family Protection Endorsement. This allows an injured individual to in effect pursue a claim against their or their families own insurance policy in situations where the party at fault is either under insured or has no insurance.
In this case the SEF 44 insurer argued and the court in the first instance agreed that the Plaintiff was an occupant in a stolen vehicle and insurance coverage does not follow in that circumstance. The court relied on the following clause in the insurance policy in dismissing the claim.
CONSENT OF OWNER
No person shall be entitled to indemnity or payment under this Policy who is an occupant of any automobile which is being used without the consent of the owner thereof.This decision was appealed by the Plaintiff. During the Appeal, the Insurance Policy was scrutinized. The court reviewed another clause in the SEF 44 policy which stated:
“This endorsement is attached to and forms part of the policy and shall be effective from the local time and effective date of the policy or renewal… Except as otherwise provided in this endorsement, all limits, terms, conditions, provisions, definitions and exclusions of the policy shall have full force and effect.”
The appeal Judge ultimately found that these two provisions of the insurance policy did not quite line up with one another. The key piece of evidence that was missing whether or not the Plaintiff had knowledge that the driver had taken the vehicle without consent. Accordingly, it was found that it would not be fair to throw out the case because of an ambiguity in the policy. The case was restored and is allowed to proceed on to trial.
However, this does not mean that the case will be successful at trial. There is clearly risk that this may be dismissed if there was knowledge that the Plaintiff knowingly stepped into a stolen vehicle. As such, one must be extremely careful when stepping into a vehicle as it is clear that in the event of an incident, insurance coverage does not always follow.
For full details about the case, please visit the following link: https://www.canlii.org/en/ab/abqb/doc/2017/2017abqb487/2017abqb487.html?autocompleteStr=cardinal%20v.%20alberta%20motor&autocompletePos=1