Company president says it’s important to come up with permanent solution
On June 18, 2019, the Nova Scotia Court of Appeal released its decision in the case involving Trisura Guarantee Insurance Company of Canada (Trisura) and Duncan et al. This decision is noteworthy, as it may lessen an insured’s obligation to notify and disclose potential claims, and increase the burden of diligence on the insurer.
Trisura provided professional liability coverage to Keybase National Financial Services Inc. (Keybase) from July 2008 to July 2012. Gregory Duncan and James White (Duncan and White) were Keybase advisors during this time.
Duncan and White assumed responsibility for John Allen’s (Allen) clients. Allen was also a Keybase advisor. He was dismissed by Keybase in September 2007. Allen was sued by his former clients in 2009. Allen was convicted for criminal offences, and his former clients were successful in their action against him (2014 NSSC 31 (CanLII)).
However, following the 2014 decision against Allen, the clients (Allen Clients) turned around and commenced a claim against Duncan and White as well, complaining of improper advice concerning mitigation of losses caused by Allen (2015 Action).
Duncan and White applied for, and were granted, an order compelling Trisura to defend the 2015 Action (2018 NSSC 92). Trisura appealed this decision. It asserted that the Court erred: (1) in its interpretation of notice obligations under the policy; (2) in finding that Duncan and White complied with those obligations; and (3) in finding that relief from forfeiture was available in the circumstances. The decision was upheld.
The Appellate Court’s decision
Trisura stated that: (1) it was not notified of any claims or potential claims during the policy periods; and (2) Keybase knew or should have foreseen that Duncan and White had exposure when Keybase first applied for insurance in 2008.
With respect to Trisura’s first argument on notification, the Court disagreed. Although the 2015 Action arose after the Trisura policy expired, the policy afforded coverage if Trisura was notified during the policy period. In 2010, Keybase’s third party insurance consultant (the “Consultant”) had reported potential claims from the Allen Clients. Trisura argued that these reports were related to Keybase and Allen’s negligence. They argued that “notice” was not collective. Further, notice respecting one Duncan and White client could not be notice for all clients. The circumstances needed to be differentiated.
The Court stated that Trisura’s knowledge of what transpired between Keybase, Allen and the Allen Clients underpinned its understanding of how Duncan and White, as subsequent advisors, were exposed to claims of liability. Trisura, as a sophisticated player in the insurance industry, with the benefit of prior knowledge and context, should have known the potential for further claims. Without prior knowledge, it was safe to assume that Trisura would have sought more explanation in the reports.
Trisura’s argument that notification with respect to potential liability regarding one client cannot be notification with respect to the others failed, because there was no material difference between the former Allen Clients’ claims against Duncan and White, and the losses sought.
In June 2010, the Consultant indicated there were seven client complaints against Allen and “two current agents”. Furthermore, on July 2, 2010, Trisura received an adjuster’s report stating:
“There could be exposure for the alleged failure by the subsequent Keybase advisors (Jim White and Greg Duncan) to rectify the situation or to have caused an aggravation of the situation”.
Trisura argued that the report was misconstrued. The actual focus was whether potential claims against Duncan and White should have been disclosed prior to placement of coverage with Trisura.
Nevertheless, on December 29, 2010, the Consultant wrote to Trisura’s adjuster:
“We confirm that any subsequent claims will be treated by Trisura as having arisen in the period in which these circumstances were reported … July, 1, 2009 to July 1, 2010.”
Trisura did not respond.
Trisura also argued that claims against Duncan and White were not commenced during the policy period, because Duncan and White themselves did not think they had any exposure. However, the Court noted that it was unnecessary for the insured to provide notice personally. Additionally, the Consultant was reporting to Trisura on behalf of Duncan and White, and Keybase. The purpose of notice was satisfied in light of the adjuster’s assessment of the potential exposure.
Considered alone, this is not a novel decision. However, it may form part of a broader legal framework, which will make it difficult for insurers to challenge the adequacy of notification and disclosure moving forward.
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Chicago, July 3, 2019 — Hub International Limited (Hub), a leading global insurance brokerage, announced today that it has acquired Berk Bilgen Insurance Ltd. (BBI). Terms of the transaction were not disclosed.
BBI is an independent insurance brokerage based in Edmonton, Alberta, Canada, offering personal and commercial insurance solutions, including home, auto, life and travel. In ten short years, BBI has grown considerably under the leadership of Berk and Heather Bilgen and has become a market leader in the Edmonton area. Mr. and Ms. Bilgen chose Hub for its extensive services to clients and employees and will be active in the transition of business to the Hub team.
About Hub’s M&A Activities
Hub International Limited is committed to growing organically and through acquisitions to expand its geographic footprint and strengthen industry and product expertise. For more information on the Hub M&A experience, visit WeAreHub.com.
About Hub International
Headquartered in Chicago, Illinois, Hub International Limited is a leading full-service global insurance broker providing property and casualty, life and health, employee benefits, investment and risk management products and services. With more than 11,000 employees in offices located throughout North America, Hub’s vast network of specialists provides peace of mind on what matters most by protecting clients through unrelenting advocacy and tailored insurance solutions. For more information, please visit www.hubinternational.com.
#HappyCanadaDay, We’ll be Back on Tuesday, July 2nd!
The ILScorp offices will be closed Monday, July 1st. As we take some time to enjoy Canada Day. We’ll be back Tuesday morning, ready to take your calls, answer your questions and register you for online insurance programs. You can reach us from 8 a.m. – 5 p.m. Pacific Time.
You can also register for our insurance training programs online, anytime, at ILScorp.com
ILSTVNews Canada’s Source For Insurance Professionals is taking this coming summer off to spend time with loved ones, family and friends. For subscribers to the ILSTV Insurance Industry Newsletter, your Daily dose of Canadian Insurance News returns to your inbox on Tuesday, Sept 10th.
But not to worry we have your insurance news covered. Our Weekly Canadian Insurance Newsletter will continue through the summer so I know if you haven’t already you’ll want to sign up for our weekly Canadian Insurance News to stay up-to-date while you enjoy your summer. :). Follow this link to sign up for our Weekly Insurance Newsletter – ilstv.com
Stay safe and have a fabulous summer everyone!
Cannabis-infused foods, beverages set to become legal as of December
Intent of the Fast Forward education program isn’t funding full-time students, province says
· CBC News
Many post-secondary students in Nova Scotia are scrambling to find enough money to go back to school in the fall after the federal government requested a change to a program that allows people to draw employment insurance benefits while studying.
Students in the province’s Fast Forward education program don’t have to look for work while on EI, and can instead enrol in approved programs to update their skills and training.
“I’m extremely devastated by the news, me and along with all the students I know, because a lot of us really depended on this money when we go back to school,” said Jacqueline McNeil, a science student at Université Sainte-Anne.
Employment and Social Development Canada is now requiring participants to have been in the workforce for at least 24 months, which excludes hundreds of students from accessing the program.
Under the new rule, the province anticipates 540 students will no longer be eligible — a 30 per cent reduction of the over 1,800 people who benefited from the program in Nova Scotia last school year.
Study part time or take a year off?
Without the additional funding, some students are considering reducing their course load to part time or taking a year off to save enough money to continue their programs.
In addition to her student loan, McNeil was able to draw the EI she accumulated from summer jobs to help cover her rent and expenses while she lives in Church Point, N.S., during the school year.
Now, she’s no longer eligible.
‘No other option’
She plans to try to save enough money this summer to remain a full-time student.
“If I end up running out of money and the student loan can’t cover [the balance], I’m going to have to switch from full-time schooling to part-time schooling because I’ll have no other option,” said McNeil from her Sydney home.
“It’s pretty awful honestly. I don’t think it’s right. I think if you can apply for EI and get unemployment, we should still have access to these benefits. It’s money that we earned.”
The province’s Department of Labour and Advanced Education said the federal government asked that the program’s intention be changed to ensure applicants are unemployed workers taking training during a period of unemployment.
“The program is not intended to fund full-time students,” said department spokesperson Shannon Kerr.
Before the change, Fast Forward criteria permitted people who have been out of high school for a minimum of 12 months to access the program as long as they qualified for EI, said Kerr.
The criteria for new applicants came into effect on June 7. Some current applicants will be able to continue in the program until the end of the year.
Summer or part-time employment for people enrolled in full-time school does not count toward the 24 required months.
Employment and Social Development Canada did not say how many programs across the country the change affects.
They also did not say the reason behind the change.
Nova Scotia’s program launched in 2015. Changes to EI eligibility the following year allowed students working in the summer months to access the program, said Kerr.
Dalhousie engineering student Allen Cox doesn’t know if he’ll again be eligible to use the program.
The sudden change has left him in the lurch as he considers whether he’ll need to take a year off school to earn money.
“A year’s not the end of the world, but it wasn’t my plan,” said Cox, who used the program for the spring term once he heard about it.
Participants were notified of the change by letter on June 10.
Cox said with school resuming in September, that “isn’t very much time to come up with money you thought you had available.”
Had the rules not changed, he estimated he would have been able to draw around $10,000 of EI in the upcoming year — a larger sum than most full-time students would earn because of his program’s four-month-long work terms.
Roughly half of his class of about 80 people are enrolled in the program, he said.
“There’s a lot of students in my degree worried about it,” said Cox.