1) Who are the parties to an insurance contract?
1st party – the insured – this is the party that is protected by the policy.
2nd party – the insurer – this is the company that provides the insurance.3rd party –
others – this refers to anyone else involved in a motor vehicle accident. There can be multiple 3rd parties involved in any claim.
2) Who 3rd parties?
3rd party – others – this refers to anyone else involved in a motor vehicle accident. There can be multiple 3rd parties involved in any claim.
3) Define the concept of negligence.
Negligence: is the omission to do something which a reasonable person, guided by those considerations which ordinarily regulate the conduct of human affairs, would do, or doing something which a prudent and reasonable person would not do.
4) What does it mean when we say that a person is liable?
Liable – means legally responsible.
5) Who is liable for the damages caused in an automobile accident?
Both the Driver and the Owner of the vehicle are liable for the damages
6) What is an important proviso in determining a vehicle owner’s liability for a driver’s negligence?
An important proviso in determining the owner’s liability for a driver’s negligence is that the driver must be operating the vehicle with the consent of the owner. The owner is not liable for damages or injuries to others when the vehicle is being operated without the owner’s consent.
Ex: when the vehicle is stolen.
7) What is onus of proof and how does it relate to automobile insurance?
Onus of Proof: means the burden or responsibility of proof, and is sometimes referred to by its latin term, onus probandi.
When 1 person sues another, the law puts the onus of proof upon the person suing – the plaintiff – to satisfy the court that there is enough evidence to uphold the allegation that negligence of the person being sued – the defendant – caused the damages. In response, the defendant has an opportunity to demonstrate there was no negligence or that negligence rests elsewhere.
In the realm of automobile insurance, when 2 motorists are involved in an accident, the 1 who alleges the other is negligent must prove the allegation of negligence.In some provinces, legislation makes one important exception to this.
In an accident involving a pedestrian, the motorist is presumed to be liable to the pedestrian, and it is up to the motorist to prove he or she was not negligent.
8) How does the concept of subrogation affect the settlement of automobile insurance claims?
Subrogation is another key legal concept when it comes to settling automobile insurance claims. An insurer that pays to repair an insured’s vehicle damaged by a 3rd party, has the right to pursue recovery from that at-fault 3rdparty.
Subrogation: is the transfer of legal rights (to an insurer) of someone whose debts or expenses have been paid to pursue recovery from an at-fault party.
9) Who benefits from the absolute liability provision automobile liability insurance?
Under the various absolute liability provisions applicable in each jurisdiction, the law extends some rights to a third party where there is automobile liability insurance. 3rdparties are given a direct right of action against the insurer to have the insurance money under the policy paid directly to them. This means claimants are ensured of being able to share in the money payable under a motor vehicle liability policy if the insured contravenes a policy condition. Some jurisdictions require a judgment to be obtained in favour of the 3rd party before money will be awarded under absolute liability. Others do not require it if liability is clear-cut.
10) What is covered by Third Party Liability coverage?
a) Automobile – since it arises from accidents involving motor vehicles
b) 3rd party – since the damage for which one is responsible is to an innocent 3rd party
c) Liability – since an individual is legally liable for the damages caused by the negligent operation of a vehicle
11) Who is compensated by Third Party Liability coverage?
12) Who provides Third Party Liability coverage in Manitoba?
Manitoba Public Insurance
13) Summarize who is insured under Autopac Third Party Liability coverage.
Vehicle owners in Manitoba are covered when driving their own vehicles or when someone else drives their vehicles with their permission. When driving other peoples’vehicles, they are covered as long as they are driving with the owners’permission. However, in all cases, the driver must have a valid driver’s license.
14) What is the purpose of a pink card?
Pink cards are designed to serve as evidence of automobile Third Party Liability insurance. They are proof of an in-force automobile insurance liability policy with at least the minimum limits as set by law in each jurisdiction.
15) What do financial responsibility laws require of owners and operators of automobiles?
Financial responsibility laws require owners and operators of automobiles to maintain enough money to compensate those they injure. Liability insurance is the most common way too satisfy these requirements.
16) Why might a person need to file proof of financial responsibility and how would this proof be filed?
A person might need to file proof because of a previous conviction under the Criminal Code or Motor Vehicle Act or because of being involved in an accident while uninsured. Proof of financial responsibility may also be required at the discretion of the Superintendent of Motor Vehicles in cases involving underage or elderly drivers.
Motor vehicle liability cards and written certificates from insurers authorized to carry on automobile insurance in the province (subject to certain conditions) are acceptable forms of proof. But proof can also be filed by having surety bonds filed by a licensed surety company or depositing cash, or satisfactory securities, equal to the minimum limits of insurance required in the province for each automobile owned. However, these latter methods of filing proof are rare, and are mostly used by corporations.
17) Can Autopac Third Party Liability coverage be transferred to a vehicle other than the one described on the owner’s certificate? If so, what conditions are there for coverage to be transferred?
Autopac Third Party Liability coverage can be transferred to a vehicle other than the one described on the owner’s certificate. However, the coverage is only transferable when such a vehicle is driven by an insured who believes, upon reasonable and probable grounds, that the vehicle is insured under an owner’s certificate, or is otherwise insured against the legal liability imposed by law for its ownership, use, or operation.
18) When are non-owned vehicles excluded from Third Party Liability coverage?
Autopac Third Party Liability coverage is not transferable in situations where:
a) The vehicle is owned by the driver; or
b) A condition under the vehicle’s own insurance policy has been breached
19) What are the duties of MPI for Third Party Liability claims?
a) Upon receipt of notice of the claim, assist the insured by investigating and negotiating a settlement, when MPI deems that it is expedient to do so;
b) Without cost to the insured, defend on the insured’s behalf, any civil action for damages brought against the insured in respect of injuries, death, or loss of, or damage to, the property of another;
c) Pay all costs taxed against the insured in any civil action defended by the Corporation, except the cost of an appeal taken by the insured without the consent of the Corporation, and any interest accruing after entry of judgment, upon the part of the judgment that is within the limits of the liability of the Corporation; and
d) Reimburse the insured for payment for immediate medical aid for a person injured in an accident for which coverage is provide under Autopac Third Party Liability
20) What driving limitations are outlined in the Conditions of Liability?
The insured shall not drive or operate any vehicle which is covered under Third Party Liability coverage
a) If he not qualified and authorized by law to drive or operate the vehicle or, if the law does not prescribe any qualification, while under the age of 16 years;
b) While his license to drive or operate that vehicle (or his right to obtain a license) is suspended or while he is prohibited, under order of any court, from driving or operating that vehicle;
c) For any illicit or prohibited trade or transportation;
d) In any race or speed test;
e) When the vehicle is attached to a trailer that is required to be registered under the Drivers and Vehicles Act, but is not;
f) To escape or avoid arrest or other similar police action or in contravention of a signal from a peace officer requiring him to bring the vehicle to a stop; or
g) With the intention of willfully or deliberately causing bodily injury, death, or damage to property.
21) What is the insured required to do when coverage under Third Party Liability may be asserted?
Where Third Party Liability coverage is or might be asserted, the insured shall
a) Promptly provide the corporation with written notice containing all available particulars of any accident involving loss or damage to the persons or property of others, and of any claim made in respect of any such accident;
b) Provide such affidavit or statutory declaration as MPI may require to verify that accident leading to the claim for Third Party Liability coverage, arose of the insured’s operation of an insured vehicle;
c) Forward to the corporation every statement of claim, writ, letter, document, or advice relating to a claim against an insured for which coverage may be provided under Third Party Liability coverage immediately upon receiving them;
d) Not voluntarily assume any liability or settle any claim except at his own cost;
e) Not interfere with the corporation in any negotiations for settlement or in any legal proceedings;
f) Whenever requested by the corporation, aid in securing information and evidence, as well as the attendance of any witness; and
g) Co-operate with the corporation, except in a pecuniary way, in the defense of any action or proceeding, or in the prosecution of any appeal, taken by the corporation on behalf of the insured.
22) How does Autopac Third Party Liability coverage attached to the vehicle involved in the accident interact with other coverage that maybe available, such as through extension insurance?
Autopac’s basic Third Party Liability coverage is considered to be primary coverage in Manitoba. This means it would respond first to a Third Party Liability claim made against the insured. Any additional insurance purchased to increase Third Party Liability limits would be considered excess coverage and only be used if the basic limit of $200,000 is reached, or if there is a breach under basic Autopac, but coverage is still valid under the excess policy. In that case, the excess policy would drop down and become primary.
23) What coverage is available for a newly acquired substitute automobile?
In Manitoba, Insureds can transfer the license plates from their currently registered vehicle to their newly acquired vehicle when:
- Both vehicles are in the same registration class, and
- They both have disposed of the registered vehicle.
They then have 7 days after the day they disposed of their old vehicle to register their replacement vehicle.
24) State the exclusions to coverage under Autopac Third Party Liability coverage.
a) Damage to property the insured owns or rents or has in his care or control caused by the insured’s vehicle
Ex: The insured’s automobile damages his boat, which is parked in his driveway for the winter – his homeowner’s insurance policy may cover the damages.
b) Loss or damage to other people’s property in or on the insured vehicle
Ex: a borrowed canoe attached to the roof of the insured’s vehicle is not covered.
c) Loss or damage occurring through the use of machinery or equipment mounted on or attached to the vehicle while the vehicle is parked at a work site
Ex: a truck that is damaged while parked and spraying insecticide to control mosquitoes is not covered.
d) Damage caused while the vehicle was being driven by someone in the business of repairing, servicing, storing, or parking vehicles or someone who is an automobile dealer and is not the insured’s employee or partner
Ex: damage caused while the repair shop employee was test-driving the insured’s vehicle before or after servicing it is not covered.
e) Loss or damage suffered by an employee of the insured who was injured while operating or repairing the insured’s vehicle
f) Loss or damage from criminal activity
g) Liability imposed by any workers’ compensation law
h) Liability for damages from injury, death, or damage to property due to a nuclear energy hazard
i) Operating a Government of Canada vehicle
j) The insured’s own injuries or death – Third Party Liability coverage is for claims others may make against the insured
k) Operating a commercial truck, with a gross vehicle weight of (GVW) over 5,499 kg, or a public service vehicle such as a truck or buss more than 161 km outside of Manitoba
l) Operating a municipal or other government-owned fire department vehiclem) Vehicles covered under Single Trip Registration Permits
n) Operator a tractor
o) Loss or damage caused by a semi-trailer
25) How might an insured cause a claim under Third Party Liability coverage to be forfeited?
MPI can refuse coverage to an insured if
a) Someone was driving who was not qualified and allowed by all law to drive(an unlicensed driver);
b) Someone was driving with a suspended driver’s license or who is prohibited from driving because of a court order;
c) Someone under 16 was driving, who did not have a learner’s permit or was not following its terms;
d) The vehicle was being used to carry on an illegal trade or to transport items in violation of the law;
e) The vehicle was being used in a speed test or motor race;
f) An unregistered trailer was attached to the vehicle when the law requires the trailer to be registered;
g) The vehicle was being used to flee from the police; or
h) The vehicle was used to deliberately cause injury, death, or property damage.
26) When do subrogation rights apply with respect to Third Party Liability coverage?
When it pays a claim under 3rdparty liability coverage, MPI would assume subrogation rights. However they apply only where the loss, damage, injury, or death for which the Corporation has paid or has assumed liability to pay benefits or insurance moneys is caused or contributed to by the fault of:
a) A person who, at the material time, was driving a motor vehicle
1). While not qualified to drive a motor vehicle; or
2). While not authorized by law to drive a motor vehicle; or
3). That was not designated in an unexpired owner’s certificate; or
4). That was towing an unregistered trailer that was required to be registered under The Drivers and Vehicles Act; or
5). While under the influence of intoxicating liquor or drugs to such an extent as to be for the time being incapable of the proper control of the motor vehicle; or
b) A person who, at the material time, was driving or operating a motor vehicle or trailer without the consent, express or implied, of the owner;
c) A person whose fault did not consist of acts or ommissions in the ownership, use, or operation of a motor vehicle or trailer; or
d) A person who is not the owner of a vehicle causing the loss, damage, injury, or death or sustaining the loss or damage who is engaged in the business of selling, repairing, servicing, storing, or parking automobiles or the servant or agent of any such person.
27) What is the minimum limit for Third Party Liability coverage in Manitoba?
28) Where can an insured purchase additional Third Party Liability coverage above the minimum limit?
Extension insurance offered by MPI or Private Insurers.
29) Does purchasing higher limits of liability provide extra provisions of coverage?
In most jurisdictions, purchasing higher limits of liability coverage does not provide extra provisions; it only provides higher limits for payment to a third parties, in event of a claim. The higher limits are subject to the same terms and conditions outlined previously, regardless of whether they are provided by a government insurer or a private insurer. The private insurer’s policy is treated as excess coverage to the government insurer’s basic compulsory Third Party Liability coverage in the event of a claim.
Ex: although she has the basic 200,000 limit of Third Party Liability coverage provided by compulsory insurance through the government insurer, Mary wants to protect herself against Third Party Liability claims up to $1,000,000. She can purchase higher limits of Third Party Liability coverage from the government insurer or from a private insurer.
In Manitoba, there is 1 extra provision from purchasing extension Third Party Liability coverage through MPI. The wording is changed under the condition of being “authorized and qualified to drive” to state that an insured must be “authorized OR qualified to drive”.
Ex: Mary has purchased her extension Third Party Liability coverage from Autopac. If she forgets to renew her driver’s license, and is involved in accident while driving with an expired license, she would still have coverage under the extension policy. This is because at the time of the loss, she was not authorized to drive (did not have a valid license), but she was qualified to drive( she does not need to undergo testing to obtain her license, just pay an amount).
30) When are priorities of payment applied?
Priorities of payment are only applied when the damages awarded to the 3rd party claimant are greater than the limit of 3rd party liability purchased.
Priorities of Payment: when jurisdictions prescribe a certain amount of the minimum Third Party Liability limit to be used to pay for BI claims, and a certain amount to be used for Physical Damage.
In Manitoba, claims for BI have a 90% priority over PD claims.
Ex: 200,000 claim 180,000 goes to BI and 20,000 to PD.