Chapter 1 - Intro to Auto Insurance Flashcards
Define precedent.
- is a legally enforceable decision made by a judge that will guide judges in making subsequent decisions in similar cases.
What are the 2 distinct legal system used in Canada?
1) Civil code of Quebec
2) Common law (applies to rest of Canada)
How does the Civil code operate?
- general written law
- courts in civil law system first look to the code as a basis for a decision, and then refer to previous court decisions for consistency
- governs all auto insurance contracts (and all civil rights)
- law that contains all basic provisions that govern life in society, namely the relationships among citizens and relationships between people and property
How does the Common Law operate?
- aka judge made law
- originated in Great Britain
- found only in past decisions
- cannot be found in any code or legislation
- is flexible and adaptable to changing circumstances
- system based on precedent
What are the 3 levels of law in Canada?
- authority to MAKE laws is divided between
1) Federal - Gov of Canada
2) Provincial/Territorial gov
3) Municipal/Locacl gov - can make bylaws dealing with a variety of local matters
- all 3 levels of gov have laws pertaining to the operation of autos
What does the federal legislation deal with?
- matters that affect Canada
ex) criminal law, trade between provinces, telecommunications, immigration, and extradition & fisheries - has several sections on driving offences
ex) Section 220 - criminally negligent operation of a motor vehicle
ex) Section 253, 254, 255 - cover impaired driving, driving with more than 0.08 mg of alcohol in blood, and refusing to give a breath sample to a peace officer
ex) Other sections - provide penalties for motor vehicle related criminal offences such as vehicle theft, failure to stop at the scene of an accident, and dangerous driving - these offences are tried in courts and courts apply punishment
- if insured driver is CONVICTED of offense, auto policy has exclusions to deny coverage (based on CONVICTION)
What does the Provincial legislation deal with?
- provinces & territories make laws in such areas as education, property, and health services
- sets out the rules of the road which include speed limits, rules respecting traffic lights & stop signs, who has the right of way in various situations
- auto insurance falls under provincial jurisdiction
- insurance policy does not allow insurer to deny coverage unless there is an exclusion in policy
What does Municipal Bylaws deal with?
- can make bylaws dealing with local matters such as zoning, smoking, animal control, and issuance of construction permits
- also enact crosswalk & parking bylaws, and set speed limits within their borders
- generally not denied coverage under auto policy unless exclusion in policy
- parking tickets don’t affect premium
What occurred in 1770?
- French inventor, Nicolas-Joseph Cugnot, developed a vehicle that was propelled by steam produced in a large boiler that was suspended from the front of the vehicle
- steam was the first means of locomotion
What occurred in 1831?
- in the British house of commons, a special committee reported that it considered the auto movement to be fully established
- noted that prohibitive & excessive tolls were being charged on highways because of popular prejudice against strange new invention
- law required that a man carried a red flag during the day, and red lantern at night must walk 100 yards in front of every auto
When did provinces enact mandatory conditions for auto policies?
- early 1920’s
- statutory conditions were the only thing that was the same in the polices
- included specific obligations of both insured and insurer in event of an accident
- in early 1930’s standard policy wordings were introduced
- became mandatory canada wide
- no fault AB (except for NWFD/Labrador)
How is auto insurance distributed in Canada?
1) Sold by private insurance companies which sell their products either:
i) directly to the public - direct writers (state farm/ belair)
ii) through brokers or agents selling on behalf of private companies - (RSA)
2) Sold by crown corporations set up by provincial gov (ICBC). These corps may sell their products:
i) through brokers/agents (who also sell for private companies)
ii) through own direct sales department
iii) through other gov agencies (motor license offices)
How do government operated auto insurance work?
- Saskatchewan, Manitoba, BC
- premium is paid annually when vehicle license plate is renewed
- some cases a fee is charged when driver’s license is renewed
- no policy is issued, but a motor vehicle certificate of registration is issued
How does auto insurance operate in Quebec? (dual system)
1) bodily injury claims are covered by a gov compensation plan
- funded by premiums collected when license plates/drivers licenses are renewed and gasoline sales tax
2) property damage claims are covered by standard auto policies issued by private insurance companies
- covered by premiums paid to private insurance companies
What does Section 227 of Ontario Insurance Act contain?
- insurer must use forms approved by superintendent:
1) application for insurance
2) policy, endorsement, renewal
3) claims form
4) continuation certificate
