Know These Important Insurance Tips When Filing a Claim

In this week’s blog post, one of our litigators at Hutchison Oss-Cech Marlatt, Dana G. Quantz, wants to share some useful information if you are in a situation where you are making an insurance claim based upon a policy of insurance. Insurance is available for all sorts of things to help avoid the cost of misfortunes that can happen in the future. We can insure ourselves against sickness (e.g., health insurance or disability insurance), our properties against damage (e.g., fire loss of a home), or even our lives. There are some common features to all insurance that you need to know and which our lawyers will ask for to help you assess the viability of your insurance claim.

The Law

In British Columbia, all insurance policies, except for car insurance, are governed by the Insurance Act, RSBC 2012, c. 1. This legislation sets out the minimum requirements for a contract of insurance to be valid, the method of making a claim, and importantly the methods by which insurers can legally deny a claim.

The Policy Wording

The first request a lawyer will make on an insurance claim consultation is for a copy of the full policy wording, namely the large document that describes what is covered and what is excluded. Section 11 of the Insurance Act, RSBC 2012, c. 1, says that a policy must contain all the following to be valid:

1. The name of the insurer.
2. The name of the insured.
3. The name of the person to whom the insurance money is payable.
4. The amount, or the method of determining the amount, of the premium for the insurance.
5. The subject matter of the insurance.
6. The indemnity for which the insurer may become liable.
7. The event on the happening of which the liability is to accrue.
8. The date the insurance takes effect.
9. The date the insurance terminations or the method by which that date is established.
10. The statement that: “Every action or proceeding against an insurer for the recovery of insurance money payable under the contract is absolutely barred unless commenced within the time set out in the Insurance Act.”

We will address the dates for filing and making claims below, but it is initially important to know the above 10 items. Each of these items is included in the copy of the full policy wording.

Often insurance companies will provide copies of declarations showing the amount of coverage but will fail to provide the actual policy wording. As insurance copies are subject to freedom of information requirements and as s. 26 of the Insurance Act, RSBC 2012, c. 1 requires insurers to provide the contents of the policy, it is easy to simply request copies of the full policy wording for your particular policy. Simply demand a copy from your insurance company and the adjuster assigned to your case.

Burden of Proof

It is a fundamental principle of law that the burden of proof falls upon the party that is putting it forward. This means that the person making a claim has the burden of establishing the facts necessary to prove that claim. If you have suffered property damage, then the burden of proving the property damage rests with you. If you had some property stolen, then you need to prove ownership of the items stolen, the theft occurred and the value of the items.

The BC Court of Appeal described the burden of proof as follows in Bevacqua v ICBC, 1999 BCCA 553:

[24] The general rule is that the party who makes a positive assertion bears the burden of proving it to the appropriate standard. In insurance claims the insured has the onus of showing that the loss alleged falls within the perils insured against under the terms of the policy coverage. Once that burden has been met, the onus is on the insurer to prove any affirmative defences, including fraud: see Roland Roy Fourrures Limited v. Maryland Casualty Company, 1973 CanLII 141 (SCC), [1974] S.C.R. 52; and Continental Insurance Co. v. Dalton Cartage Co., 1982 CanLII 13 (SCC), [1982] 1 S.C.R. 164.

[25] In cases where the peril insured against does not require any human intervention, there is usually no difficulty in applying those general rules. However, some losses cannot occur without human action. Theft, by definition, requires the taking of property by a person, and vandalism, by definition, requires the intentional infliction of damage to property.

Later the Court reasoned that:

[44] It must be remembered that allegations of fraud against an insured are quasi-criminal in nature, and if proven could affect the insured’s life well beyond the outcome of his insurance claim. Such serious allegations call for heightened scrutiny of the evidence by a trial judge, before being satisfied that an allegation of fraud has been proven on a balance of probabilities: see Continental Insurance Co. v. Dalton Cartage Co.supra and Hanes v. Wawanesa Mutual Insurance Company, 1963 CanLII 1 (SCC), [1963] S.C.R. 154.

[45] To return to the five principles of Mr. Justice Bailhache in Munro Brice, perhaps the most important is the fourth one, namely that the characterization of qualification on coverage as either general or specific depends upon the construction of the “policy” as a whole. Here, the “insuring agreement” is contained in the insured’s Owner’s Certificate, the Regulations passed under the Insurance (Motor Vehicle) Act and the Act itself. There is nothing in any of them to suggest that where a loss by vandalism is alleged the insured will bear the onus of proving that he was not the perpetrator, or did not procure a loss. An insured looking at the terms of his comprehensive coverage would reasonably expect that a claim under this head, as for one under his fire, collision or other specified peril, would be subject to the same fundamental rules, namely that he had the burden of proving a loss falling within the coverage alleged, and that the insurer would bear the burden of proving intentional conduct on his part amounting to fraud.

[46] Here the learned trial judge effectively reversed the onus of proof by requiring the insured to prove that he had not caused nor procured the loss. In doing so, in my respectful view, he erred.

While the insured has the burden of proving their claim, the insurance company has the burden of establishing any defences, such as fraud, misrepresentation, or the application of an exclusion clause.

Knowing what your burden of proof is matters because often people will rely upon their insurance company to gather evidence at the start of the claim. Instead, the obligation is upon you to ensure that the evidence is gathered and secured for when you are making a claim under your insurance policy.

Time Frames for Claims

There are three time deadlines to be aware of in making a claim under an insurance policy under the Insurance Act, RSBC 2012, c. 1. The first two are set out in s. 29 of the Insurance Act, RSBC 2012, c. 1 under the Statutory Conditions applicable to all insurance policies in British Columbia.

Statutory condition number six says that after a loss occurs that triggers coverage under an insurance policy, an insured must immediately notify the insurer in writing.

Insurance claims are often made on the phone today. You are asked to phone your insurer or the insurance broker to advise them of the claim being made. They will often require you to fill out forms and paperwork advising the insurer of the details of the claim. That form constitutes your notice in writing.

A failure to give immediate notification of the claim can result in the insurance policy becoming void.

The second date is the provision of the “proof of loss”. A proof of loss form varies depending on the loss claimed and the item insured. The proof of loss document must be verified by a statutory declaration (which is a notarized form) and must set out the amounts claimed and include the evidence you have to support the claim.

Filing a fully executed proof of loss with the insurance company triggers the time frame for the insurer to make a decision about the validity of the claim. The insurer has 60 days after receiving a proof of loss to pay out the money claimed in the document.

The last time frame to be aware of is the date you need to file a claim within the courts. This date depends upon the type of claim being made.

A claim about damage or theft of property must be filed before the two-year anniversary of discovering the claim. So, if a person suffers fire damage to their home on October 1, 2022, then they must file their claim by September 30, 2024.

A claim about accident or sickness insurance is different. In those claims, the time frame starts when the insurance company issues their denial of the claim.

The manner in which a claim is protected is by filing a notice of civil claim with the Supreme Court of British Columbia.

As these dates can be confusing and the court forms are difficult to fill out, it is recommended that you seek legal help if you are contemplating suing your insurance company.

Seek Legal Advice

If you are dealing with an insurance claim and a difficult insurance company, then we encourage you to speak to one of our lawyers regarding this claim. Contact us and we can help you evaluate whether you have a viable claim.

We know insurance law!