In Ruddell v. Gore Mutual Insurance Company,1 an insurer argued that its insured’s failure to keep them updated on her current address was a substantial breach of the duty to cooperate. On a summary judgment motion, a judge of the Ontario Superior Court disagreed and ruled that – in these circumstances – the insured’s conduct was not a “substantial” failure to cooperate. This was upheld on appeal.

A recent decision of the Alberta Court of Queen’s Bench demonstrates that policy holders must carefully consider the interplay between an insurance policy and its endorsements. In Wage v Canadian Direct Insurance Incorporated, 2019 ABQB 303, the court interpreted a standard form family protection endorsement to an automobile insurance policy to provide coverage for an accident in the Philippines, even though the territorial limit of the underlying policy was Canada and the United States.

An Ontario court recently found that the injuries sustained by a pedestrian when eggs were thrown at her from a vehicle arose “directly or indirectly from the use or operation of an automobile”. The court determined that the act of egg throwing in this case was not a distinct and intervening act from the use or operation of the vehicle, as the speeding vehicle created speed and kinetic energy for the egg(s) which were crucial in causing the extensive damage it did.

An Ontario court recently found that a personal injury claim, by a daughter against her mother, was covered by homeowner’s insurance. The two lived together and the policy contained an exclusion for claims arising from injury to “any person residing in [the] household”. However, the court concluded that the daughter was a “tenant” under the policy and therefore the exclusion did not apply. In the absence of explicit terms, the court concluded that the insured had a reasonable expectation of coverage for claims made by tenants, even if that tenant was a family member.

In Pembridge Insurance Company of Canada v Chu, a judge of Ontario’s Superior Court of Justice recently concluded that insurance policies ought to be interpreted differently when multiple insurers are involved. In this problematic decision, the court deviated from the long-standing rule that exclusion clauses should be interpreted “narrowly”. Remarkably, the court began with the assumption that one of the insurance policies must respond to the loss. Based on this assumption, the court decided that different rules of contractual interpretation would apply.

This case is problematic because (i) it conflicts with the well-established rules for policy interpretation; (ii) it suggests that a policy can be interpreted by looking outside the contract to its effect on a non-party; and (iii) the assumption that one policy must indemnify the insured was both irrelevant and an improper consideration on a duty to defend application. Absent appellate guidance, this decision may create confusion and unintended consequences on coverage applications involving multiple insurers.

An Ontario court recently refused an insurer’s attempt to rely on evidence about its insured’s prior conduct. The insurer tried to suggest that a prior loss and misrepresentations on a mortgage application suggested a propensity towards arson or fraud. The judge’s decision demonstrates the heavy burden on an insurer seeking to rely on an arson defence to a fire loss claim.

The case in Azami v. TD Home and Auto Insurance arose out of a fire in September 2012 that destroyed the plaintiff’s home. Following the fire, the plaintiff made a claim with the defendant insurer under his homeowner’s insurance policy for the loss of his home, its contents and living expenses. During a pre-trial motion, the plaintiff moved to exclude certain evidence relating to two matters of pre-loss conduct.