Tag Archives: insurance law

By Raman Johal

Pursuant to our Insurable Interest bulletin of May 2, 2013 advising that the discount rate was being reviewed, the Chief Justice has lowered the discount rate to 2% for cost of future care (from 3.5%) and 1.5% for future income loss (from 2.5%). The new discount rate takes effect immediately.

By Jordan Watson

The Supreme Court of Canada released reasons for judgment in three cases on October 31, 2013: Pro-Sys Consultants Ltd. v. Microsoft Corporation, 2013 SCC 57 (“Pro-Sys“) and Sun-Rype Products Ltd. v. Archer Daniels Midland, 2013 SCC 58 (“Sun-Rype“), both cases on appeal from the British Columbia Court of Appeal, and Infineon Technologies AG v. Option consommateurs, 2013 SCC 59 (“Infineon“), on appeal from the Quebec Court of Appeal.

By Cassandra Drake

The Supreme Court of Canada recently refused leave to appeal the decision in Onex Corporation et al. v. American Home Assurance Company et al, 2013 ONCA 117, a case where the Ontario Court of Appeal had provided guidance on a number of important issues in the context of director and officer insurance policies. In particular, the court addressed the adequacy of notice of claims under a prior notice provision, the proper interpretation of an “insured vs. insured” exclusion clause and “reasonable expectations” in the context of a unique fact pattern.

In a world of increasing business risks, insureds often purchase one or more layers of excess coverage to secure additional protection from the unknown. Such layering of coverage, however, can trigger disputes between primary insurers and excess insurers.

In the recent decision of ACE INA Insurance v. Associated Electric & Gas Insurance Services Ltd., 2012 ONSC 6248, the Ontario Superior Court of Justice considered the issue of when an excess liability insurer would have an obligation to contribute to defence costs which are often borne by the insurer at the primary layer.

By Nigel Kent

In Dominion of Canada General Insurance v. Hannam, 2013, NLCA 37, the Newfoundland Court of Appeal has issued another reminder to the insurance industry that the “plain English” use of words like “you” and “your” can lead to ambiguity and a duty to defend where none might have been expected.

Discount rates are used to calculate the present day value of a loss of future income or cost of future care that is awarded as a lump sum in personal injury cases. The discount rate assumes that the lump sum will be invested and will earn enough income to create a sufficient stream of compensation for the injured party over the appropriate time frame, with the fund being fully exhausted at the end. This is one methodology of calculating and compensating future financial loss endorsed by the so-called 1978 “Trilogy” of catastrophic injury cases decided by the Supreme Court of Canada.