An insurer's application for summary judgment was dismissed as the court could not determine the limitation period for a claim alleging bad faith.

Redden v. Manufacturers Life Insurance Co., [2013] N.B.J. No. 309, October 4, 2013, New Brunswick Court of Queen's Bench, P.C. Garnett J.

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In reasons focusing on the need for deterrence, punitive damages awards of $1,500,000 and $3,000,000 were made against two insurers respectively. The court also awarded aggravated damages of $150,000 and $300,000 against each insurer respectively for breaching the peace of mind contracts.

Branco v. American Home Assurance Co., [2013] S.J. No. 151, March 21, 2013, Saskatchewan Court of Queen's Bench, M.D. Acton J.

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An insurer was found to have breached the duty of good faith when it decided to terminate benefits without any factual or legal grounds despite no damages actually occuring because benefits were reinstated before they were actually terminated.

Saskatchewan Government Insurance v. Wilson, [2012] S.J. No. 832, November 13, 2012, Saskatchewan Court of Appeal, W.J. Vancise, R.K. Ottenbriet and N.W. Caldwell JJ.A.

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An action for bad faith may be severed from the underlying action disputing entitlement to insurance benefits.

Insurer's application for bifurcation of bad faith claim granted.

Cort v. Insurance Corp. of British Columbia, [2011] B.C.J. No. 853, May 5, 2011, British Columbia Supreme Court, Master P. Keighley

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$50,000 awarded in punitive damages for refusing to pay a fire loss because of suspected arson.

An action by insureds to recover the proceeds from a fire insurance policy from their insurer after a fire, as well as aggravated and punitive damages for the insurer's refusal to pay. The action was allowed.

Sidhu v. Wawanesa Mutual Insurance Co. [2011] B.C.J. No. 1573, August 17, 2011, British Columbia Supreme Court, T.C. Armstrong J.

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Bad faith claims may be severed from the underlying entitlement action.

Defendant’s application to sever a bad faith claim from a claim for breach of contract.  Application granted.

Nayyar v. Manufacturers Life Insurance Co., [2010] B.C.J. No. 2200, October 7, 2010, British Columbia Supreme Court, P.W. Walker J. (in Chambers)

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An insurance company must follow up on evidence after the initial decision to deny a claim is made. If they do not punitive damages may be assessed against them.

Appeal by the insurer from a jury’s award of punitive damages dismissed. By not following up on all the evidence relevant to the claim, withholding critical information from the adjuster engaged to investigate the claim and allowing the adjuster to present the results of the investigation in a partisan, biased and un-objective manner, the insurer’s actions were exceptional. A reasonable jury could have concluded that an award of punitive damages was rationally required to punish the insurer’s conduct.

Kings Mutual Insurance Co. v. Ackermann, [2010] N.S.J. No. 255, May 4, 2010, Nova Scotia Court of Appeal, J.W.S. Saunders, M.J. Hamilton and J.E. Fichaurd JJ.A.

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An insurer may be orderd to pay aggravated damages if recommended benefits are refused without sufficient evidence supporting the denial.

The defendant insurer, was obliged to pay housekeeping and transportation benefits that it had unreasonably withheld from the plaintiff insured. The insurer’s refusal to pay benefits had caused intangible injuries and mental distress that were reasonably foreseeable and the insured was accordingly awarded $25,000 for mental distress.

McQueen v. Echelon General Insurance Co., [2009] O.J. No. 3965, September 28, 2009, Ontario Superior Court of Justice, C.R. Harris J.

 

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A sewage backup caused by a flood may be covered by an all risk homeowner's policy.

The insureds' application for coverage under their policy for damage to their home during a flood was allowed. The insurer did not meet its onus of establishing that the claim fell within the exclusionary language of damage that occurred “before, during or after flood damage to the premises.” The insureds' claims for bad faith and mental distress were dismissed.

Langton v. Personal Insurance Co., [2009] A.J. No. 837, July 29, 2009, Alberta Court of Queen’s Bench, B.E.C. Romaine J.

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Once a person enters into a settlement agreement it will be difficult, absent bad faith on behalf of the insurer, to rescind the agreement.

The Plaintiff sued her insurer for accident benefits and sought to rescind a settlement agreement that she had entered into with it. Her insurer applied for summary judgment. The Court granted the application and held that the insurer had not acted in bad faith.

Perri v. Kingsway General Insurance Co., [2009] O.J. No. 2451, June 11, 2009, Ontario Superior Court of Justice, J.A. Ramsay J.

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