Study 8 - Claims Settlement

Question 1

Define deponent

Answer 1

witness making sworn or affirmed testimony out of court as part of the discovery process

Question 2

How long does the insurer have to pay the claim once the proof of loss is submitted?

Answer 2

60 days

Question 3

How does ACV vs replacement cost differ in Quebec?

Answer 3

Civil coder 2490, 2491 & 2493

Insurer pays ACV unless specifically stated otherwise in the policy

Question 4

Define aggregate deductible

Answer 4

Deductible that applies to all claims for the year

Once is made, insured does not pay any further deductibles

Question 5

Define franchise deductible

Answer 5

Insured pays all claims up to the amount set in franchise

If any loss exceeds that amount, insurer pays full amount, including the franchise amount

Question 6

What happened in Lieber v. Canadian Group?

Answer 6

Insured admitted claim was inflated and the entire claim was denied

Question 7

What should an adjuster consider when a contractor lists additional costs?

Answer 7

• Did the contractor underprice the job at the estimate stage, perhaps in order to secure the job?
• Was there a change in the scope of damage? Was there hidden damage? Should hidden damages have been anticipated?
• Did some items not respond to repairs or cleaning, with the result that replacements were required?

Question 8

How does the limit of liability rule determine contribution?

Answer 8

Limits are determined as though no other insurance existed and applies what is the least of:

• amount of insurance
• amount of loss
• amount payable after applying any policy limitation

Question 9

In Ontario, how many days notice do municipalities receive for non-repair?

Answer 9

10

Question 10

Define release

Answer 10

oral or written discharge from obligation, duty or demand. to let go of, or give up a legal claim or right to one against whom it could be enforced.

Question 11

Define discoverability rule

Answer 11

rule in tort law stated in provincial legislation that specifies that a limitation period begins when material facts upon which an action is based had been discovered by the plaintiff through due diligence

Question 12

How long does an insured have to bring action against the insurer?

Answer 12

It indicates in the policy wordings

Generally one year, some jurisdictions are up to 3 from date of loss

Quebec is 3 and is from 60 days after proof of loss received

Question 13

Define pleadings

Answer 13

formal written allegations or denials by parties in a lawsuit to a tribunal and the remedies or dispositions they seek

Question 14

Define statement of claim

Answer 14

written statement by a plaintiff detailing facts that support the claim against the defendant and relief sought

Question 15

Define notice of action

Answer 15

a summons or notice to a party that informs them of involvement in lawsuit, filed at court and served to the party before formal statement of claim is issued

Question 16

Define statement of defence

Answer 16

in a high court action, please in reply to statement of claim. responds with admissions or denials to the allegations and sets out additional facts, even a counter claim

Question 17

Define cross claim

Answer 17

demand made against another party on same side of lawsuit, plaintiff vs plaintiff or defendant vs defendant

Question 18

Where may plaintiff file notice of action first if the limitation period is nearly over?

Answer 18

Ontario & New Brunswick

Question 19

What is a notice of intent to defend?

Answer 19

It grants an extension to deadline for filing a statement of defence.

Used in Ontario, New Brunswick & PEI.

Question 20

What is the typical litigation process?

Answer 20

Notice of Action or Write of Summons
|
Statement of Claim
| 
Affidavit of Service -> (1) OR (2)
|
(1) Notice of Default -> Default Judgment
|
(2) Notice of Intent to Defend
|
Statement of Defence
|
Appearance
|
Counter Claim OR Cross-Claim
|
Consent Judgment

Question 21

What is the right of disovery?

Answer 21

party to a civil court proceeding is enabled before the determination of any matter of consequence in those proceedings:

a) all his knowledge, remembrance, info and belief concerning the manner

AND

b) production of all documents in possession or power relating to such matter

Question 22

When may a party appeal a court decision?

Answer 22

Lawyer shows an error in law or an error in a combination of law and fact

Question 23

What are the two court systems?

Answer 23

Provincial & territorial court system

Federal court system

Question 24

What are the main court levels from lowest to highest in BC?

Answer 24

Provincial Court
Supreme Court
Court of Appeal

Question 25

What are the main court levels from lowest to highest in Alberta?

Answer 25

Provincial Court
Court of Queen’s Branch
Court of Appeal

Question 26

What are the main court levels from lowest to highest in Saskatchewan?

Answer 26

Provincial Court
Court of Queen’s Bench
Court of Appeal

Question 27

What are the main court levels from lowest to highest in Manitoba?

Answer 27

Provincial Court
Court of Queen’s Bench
Court of Appeal

Question 28

What are the main court levels from lowest to highest in Ontario?

Answer 28

Court of Justice
Superior Court of Justice
Court of Appeal

Question 29

What are the main court levels from lowest to highest in Quebec?

Answer 29

Court of Quebec
Superior Court of Quebec
Court of Appeal

Question 30

What are the main court levels from lowest to highest in New Brunswick?

Answer 30

Court of Queen’s Branch

Court of Appeal

Question 31

What are the main court levels from lowest to highest in Nova Scotia?

Answer 31

Small Claims Court
Provincial Court
Supreme Court
Court of Appeal

Question 32

What are the main court levels from lowest to highest in PEI?

Answer 32

Provincial Court
Supreme Court
Trial Division
Supreme Court, Appeal Division

Question 33

What are the main court levels from lowest to highest in Newfoundland?

Answer 33

Provincial Court
Supreme Court, Trial Division
Supreme Court, Court of Appeal

Question 34

What are the main court levels from lowest to highest in NWT?

Answer 34

Justice of the Peace Court
Youth Justice Court
Civil Claims Court
Wellness Court
Domestic Violence Treatment Options Court
Territorial Court of the NWT
Supreme Court of the NWT
Court of Appeal for the NWT

Question 35

What are the main court levels from lowest to highest in Nunavut?

Answer 35

Court Services Division of the Government of Nunavut
Justice of the Peace Court
Youth Justice Court
Court of Justice
Court of Appeal

Question 36

What are the main court levels from lowest to highest in Yukon?

Answer 36

Small Claims Court
Territorial Court
Supreme Court
Court of Appeal

Question 37

What is the statutory requirement when submitting a claim against the Crown?

Answer 37

In claims against the Crown, a municipality, or other public authority, statutes require that notice of the claim must be made to the right parties within a set number of days.

Question 38

What are some typical contents that do not qualify for replacement cost coverage?

Answer 38

• Antiques
• Fine arts
• Paintings
• Statuary
• Memorabilia
• Souvenirs
• Collectors’ items

Question 39

Explain aggregate deductibles and include any exceptions.

Answer 39

• Aggregate deductibles are common for larger commercial risks.
• An aggregate deductible is usually of a substantial amount.
• It is a deductible applied as a whole to all the claims that occur during the policy year.
• Once this aggregate deductible is met, the rest of the insured claims are paid without a deductible.
• There can be exceptions. In some cases, the balance of insured claims may be subject to the deductibles outlined in individual policies.

Question 40

Explain salvage

Answer 40

• Refers to the portion of goods or property that has been saved or remains after a loss.
• The remaining value of property after severe damage by fire or other peril; in this case, after water damage to the contents of the trailer.
• The damaged items that have been replaced for Ida may still have some usefulness and residual value.
• The overall loss is reduced by the salvage value.
• Undamaged property may be quite saleable, and some property may be only partially damaged, thus repairable and then saleable.

Question 41

What are the duties and responsibilities of salvageable items?

Answer 41

• Common law statutory conditions provide that the insurer contributes proportionately, according to the respective interests of the parties, toward any reasonable and proper expenses in connection with protecting and moving such property:
• The insurer should send a representative sample for cleaning to assess whether the items can be saved.
• Economical and appropriate storage facilities may be required.
• Costs to move such property to another location to prevent further damage are recoverable.
• The general conditions of a Quebec property policy provide that the insurer will pay for such expenses to protect property.

Question 42

What are the rights and responsibilities of an insured for salvage?

Answer 42

• The insurer has the right to view and appraise damages.
• The insurer does not have the right to control or possess the property.
• Ida cannot abandon any salvaged property to the insurer without the insurer’s consent.
• An expert should evaluate the potential recovery from an item.
• Ownership of the property must be established and control of property discussed with the insured and with loss payees.