Regulation - LGIC

Insurance Contracts - Recovery by Innocent Persons

Regulation Number(s):
Instrument Type:
Regulation - LGIC
Bill or Act:
Insurance Act
Summary of Decision:
The regulation prescribes the following:

o For the purpose of section 129.1 of the Insurance Act, all classes of persons other than natural persons;
o An innocent co-insured is required to cooperate with the insurer and submit to an examination under oath, if the insurer requests; and
o An innocent co-insured is required to produce for examination all documents related to the loss or damage
Analysis of Regulatory Impact:
The regulation creates minimal financial impact to insurers and no administrative or operational costs associated with the processing of innocent co-insured claims.
Further Information:
Proposal Number:
Posting Date:
January 16, 2018
Summary of Proposal:
On December 14, 2017, the Stronger, Fairer Ontario Act (Budget Measures), 2017 received Royal Assent. The legislation included amendments to the Insurance Act to provide increased protection for innocent co-insured policyholders by prohibiting insurance companies from denying their claims for recovery.

These amendments, once proclaimed in force, will add a new section 129.1 to the Insurance Act, which, along with the proposed regulation, would create an exception to exclusionary clauses in insurance policies that exclude recovery of loss resulting from a criminal or intentional act or omission by a policyholder. The exception permits recovery by an innocent co-insured policyholder who was not involved in the criminal or intentional act or omission.

Further, section 129.1 provides that an innocent co-insured person who makes a claim for recovery would be required to comply with requirements prescribed in regulation. For this purpose, the regulation prescribes that an innocent co-insured is required to cooperate with the insurer and to produce all relevant documents for examination by the insurer.
Contact Address:
Insurance Policy Unit
Financial Institutions Policy Branch
Ministry of Finance
95 Grosvenor Street
Frost Building North, 4th Floor
Toronto, ON
M7A 1Z1
Effective Date:
April 20, 2018