Laurentian Bank looks to leave mortgage loan review woes behind

MONTREAL _ Laurentian Bank Financial Group expects to put troubles related to a mortgage loan review behind it this year, chief executive Francois Desjardins said Friday as the bank raised its dividend and reported a better-than-expect profit in its second quarter.

“I am pleased with the progress we have made, and although not yet complete, management is confident that we have a clear path to resolution,” Desjardins said on a conference call with financial analysts.

“Managing this file has been a learning experience that will help us better manage our business, implementing enhanced quality control and origination processes throughout the group, strengthening our compliance and risk management practices.”

The bank said earlier this week that it has successfully resolved issues related to mortgage loans sold to an unnamed lender that was first disclosed last year.

However, Laurentian also said Tuesday a CMHC audit during the bank’s most recent quarter found mortgages that were inadvertently portfolio insured while they did not meet CMHC portfolioinsurance eligibility criteria.

As a result, the bank said it will repurchase those other mortgage loans that were inadvertently portfolio insured and sold to the CMHC securitization program. Based on the results of CMHC’s audit, the bank estimates the total amount to be repurchased at between $125 and $150 million.

Laurentian shares closed up $1.29 or 2.85 per cent at $46.49 on the Toronto Stock Exchange Friday after the bank announced it will now pay a quarterly dividend of 64 cents per share, up a penny from its previous rate. It also reported it earned $55.9 million attributable to common shareholders or $1.34 per share in its second quarter ended April 30.

That compared with a profit of $40.3 million attributable to common shareholders or $1.19 per share a year earlier when the bank had fewer shares outstanding.

On an adjusted basis, Laurentian said it earned $1.47 per share for the quarter, up from an adjusted profit of $1.39 per share a year ago.

The adjusted result topped the $1.38 per share that analysts on average had expected for the quarter, according to Thomson Reuters Eikon.

$85,000 Non-Pecuniary Assessment for Chronic Pain With Guarded Prognosis

Today’s guest post comes from B.C. injury claims lawyer Erik Magraken

Reasons for judgement were published today by the BC Supreme Court, Vancouver Registry, assessing damages for chronic injuries sustained from two vehicle collisions.

In today’s case (Harry v. Powar) the Plaintiff was a pedestrian struck by a vehicle in a crosswalk in 2012.  She was involved in a rear end collision the following year.  The collisions resulted in ” headaches, chronic myofascial pain syndrome, cervical facet joint syndrome and lumbar facet joint syndrome” with a guarded prognosis for full recovery.  In assessing non-pecuniary damages at $85,000 Madam Justice Winteringham provided the following reasons:

[79]         I have found that Ms. Harry’s most significant injuries are the headaches, chronic myofascial pain syndrome, cervical facet joint syndrome and lumbar facet joint syndrome. ..

[84]         Ms. Harry was in her early thirties at the time of the Accidents. Sadly, the symptoms connected to her injuries are ongoing and I accept that her prognosis for a full recovery is guarded although she may experience some improvement with further treatments.

[85]         The evidence demonstrates that Ms. Harry has tried to manage her pain in a way that enables her to carry on with her life.  That is not to say her pain is insignificant.  Rather, I have found that Ms. Harry has done almost all that she can to pursue her career despite the defendants’ negligence.  It is also clear from the evidence that the energy exerted on pursuing her professional endeavours has taken a toll on the other aspects of her life.  She does not have the energy or the physical well being to regularly conduct day-to-day household tasks, engage in social events or participate in physical activity – all of which formed an integral part of her life before the accidents. ..

[90]         In all of the circumstances and taking into account the authorities I have been referred to, I am satisfied that an award of $85,000 will appropriately compensate Ms. Harry for her pain and suffering and loss of past and future enjoyment of life for which the defendants are responsible.    

‘It was quite shocking when I read the notation that the insurers were being compelled to comply’

Read more

About 10,000 homes were in N.B. flood areas, but damage still unclear:minister

FREDERICTON _ New Brunswick’s environment minister has given a new sense of scale to the province’s record-setting floods, saying as many as 10,000 homes and businesses were within flood zones.

Andrew Harvey said Thursday that precise figures have yet to come in on the extent of the damage those structures suffered, as citizens are still filing their claims for disaster relief.

“There have been close to 10,000 for residential or commercial properties that could be affected,” he said during a news conference.

“Some of these numbers are moving as we get new information as to how many actual applications we have for disaster financial assistance.”

The minister said the figure was based on Service New Brunswick’s property identification numbers located within the flooded areas.

Provincial officials also said that as of Thursday morning, there were 2,200 people who had registered for the disaster relief program, which covers some of the uninsurable damages in an effort to get homeowners back on their feet.

Meanwhile, the province has estimated there are also about 2,000 recreational properties that have suffered damage.

The rivers swollen by heavy rains and snow melt  swamped homes throughout the region and caused some cottages to collapse, with some even floating off their foundations.

Harvey also told reporters the province will have to consider changing the rules governing what can be built in the flood plains of the Saint John River and other waterways.

The province had announced that it will require property owners to start considering flood mitigation measures before they’re given a permit to rebuild or renovate in areas within 30 metres of the water.

However, Harvey conceded that this is merely a starting point, as wider changes to municipal bylaws and zoning rules have to be considered in the wake of the second major flood in a decade in his province.

“As time goes on those are decisions that are going to have to be made about zoning and about where people are building,” he said.

“These are some tough decisions that will have to be made … and we as a government at some point in the future will have to look at the issue about zoning.”

Craig Stewart, vice president of federal affairs for Insurance Bureau of Canada, said in an interview that there is no time to lose in getting fresh rules in place  and suggests modeling them on zoning created in High River, Alta., which suffered devastating river flooding in 2013.

“This should have been done yesterday,” he said.

“Given lessons learned from flood events over the past few years, absolute priority should be given to changing zoning laws so that we stop putting people in harm’s way.”

After the 2013 floods, High River brought in bylaws that turned the highest risk areas into parkland and prohibited rebuilding in those areas.

Harvey said he’s hoping the most recent events are heightening awareness that flooding isn’t going to be a once-in-a-lifetime event.

“I mean hopefully the message to the people of New Brunswick today is, these are not one in every 100 years. These are 2008 and in 2018, who knows when the next flood could be? Nobody knows,” he said.

Harvey said one bright spot was the announcement on Thursday that the government of Nova Scotia would be making a $100,000 donation to the Canadian Red Cross to help residents.

Nova Scotia Premier Stephen McNeil announced the funding, saying the province wants to “support our neighbours in their time of need.”

McNeil said about six provincial staff have also been sent to assist in the flood’s aftermath, to help process claims and inspect highway infrastructure.

McNeil said the help isn’t unusual.

Insurance report shows Alberta has highest increase in claims linked to distracted driving

 Colleen SchmidtSupervisor | CTV News Calgary

A report from a Canadian Insurance company says crashes tied to inattentiveness behind the wheel are increasing and Alberta has the highest number of distracted driving related accident claims in the country.

Aviva Canada collected data from its clients’ crashes between 2016 and 2018 and says Alberta showed a 58 percent increase in claims related to distracted driving, which is more than double the Canadian average of 23 percent.

“So we’ve seen a shocking statistic in Alberta,” said Phil Gibson, Chief Underwriting Officer, Aviva Insurance. “We took all the claims that are frequently associated with distracted driving, so rear end without skid marks that hit a stationary object, drifting across lanes and hitting something, failure to obey a stop sign, those types of things, and we’ve extrapolated that there is distracted driving going on within there.”

Gibson says 95 percent of Canadians say texting and driving by others makes them feel unsafe on the roads.

“That’s another terrible statistic. We should feel safe and certain and know that when we’re going down the road that other Canadians are looking out for each other,” he said.

Police say it takes more than enforcement to get the message across.

“People need to come to the realization that distracted driving causes all the damage, all the lives lost and all the hurt in society that impaired driving causes. The two equate to each other just like that and even though distracted driving is newer ,if you will ,than impaired driving it causes all the catastrophe that impaired driving does,”  said CPS Sgt. Dale Seddon.

Dean Lorenson started taking a bigger interest in distracted driving after he was involved in a crash.

“I think it was a Ford F-150, was just kind of rolling through and knocked me over,” he said.

Lorenson counts the number of distracted driving related tickets that are written by Calgary police and even involved his son’s Grade 3 class to help keep track.

The students counted 430 instances of distracted driving in a single month and Lorenson says people are making things worse by trying to hide the fact that they are looking at their phones while they drive.

“Actually that makes it worse because you’re really not paying attention. If your phone is up here, while you’re driving, you might be able to see but if you’re trying to hide it and looking down here, that just makes the problem worse,” he said.

Checking phones while driving or even when stopped at a traffic light is illegal and despite awareness campaigns, fines and do-not-disturb technology, it’s a behaviour that has proven challenging to change.

“I don’t think it’s going to take more laws or even technology. I think we can start influencing each other when we think about what an awesome responsibility it is driving a car and keeping each other safe to just stop allowing yourself to be distracted,” said Gibson.

The insurance company suggests planning ahead, prepping podcasts and playlists or locking away your phone.

Proposed Privacy Breach Class Action Against The Personal Insurance Company

A proposed privacy breach class action lawsuit has been launched by the law firm Waddell Phillips Professional Corporation against The Personal Insurance Company and its parent, Desjardins General Insurance Group Inc.

The plaintiff, Kalevi Haikola, commenced this claim against his motor vehicle insurer after it accessed his credit score when it was adjusting a simple accident benefits claim.  The lawsuit alleges that credit score information is wholly irrelevant when an insurer is resolving accident benefit claims, and therefore the defendants could only be using this information for improper purposes, and against the interests of their customers.

In fact, Mr. Haikola complained to the Office of the Privacy Commissioner of Canada, alleging that the demand for credit score information was improper.  The Privacy Commissioner agreed, holding that The Personal collected and used credit information from Mr. Haikola without obtaining meaningful consent, and in a manner that a reasonable person would consider inappropriate. The Office of the Privacy Commissioner of Canada concluded that The Personal violated the Personal Information Protection and Electronic Documents Act (“PIPEDA“).

In February 2018, The Personal told the Privacy Commissioner that it had stopped the practice of collecting and using credit score information during its claims assessment process. Despite this representation to the Privacy Commissioner, after Mr. Haikola was involved in a rear-end collision in March 2018, The Personal asked Mr. Haikola, not only for his consent to access his credit score (the very thing that it had said it was no longer doing, and which was found to be a PIPEDA breach), but it also asked for much more intrusive financial disclosure.

The claim asserts that the foremost obligation of an insurer is to act with utmost good faith toward its insureds. This obligation includes the duty to respect the privacy interests of insureds. Intrusive prodding into personal financial affairs, including credit scores, of insureds is inappropriate and unlawful under Canadian privacy legislation. The claim alleges that persons involved in motor vehicle accidents are particularly vulnerable in the hands of their insurance companies, and can reasonably expect their insurers to treat them fairly. This includes a reasonable expectation that they will not be given differential treatment based upon their personal financial circumstances.

In this action, Mr. Haikola seeks damages for defendants’ breach of the privacy rights of Canadians embodied in PIPEDA, and for the defendants’ alleged bad faith based upon continuing the practice of collecting personal financial information after they told the Privacy Commissioner that they had stopped the practice.  Mr. Haikola seeks damages on behalf of all class members for the alleged unreasonable breach of their privacy and the insurer’s alleged breach of the duty of utmost good faith.

Additional information about this case, and a private portal for class members to communicate with class counsel is available at: www.personalprivacyclassaction.com.

SOURCE Waddell Phillips Professional Corporation

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