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Canadian Underwriter - January 2016


Uber Exclusion
The standard auto policy in Ontario has an exclusion for carrying passengers for compensation or hire, and this could lead to denial of claims involving vehicles providing uberX service.

Psychological Injuries
It can be challenging to examine a claim if it involves a psychiatric or psychological issue. An adjuster may need guidance from professionals with expertise in mental disorders and from court decisions on causation and foreseeability.

Pollution Containment
Minimizing the severity of a pollution claim requires contingency planning and an immediate response. While many commercial general liability policies do not cover pollution, some insurers offer in-house expertise in emergency response, environmental remediation and applicable regulations.

Extreme Weather
A study released in December includes detailed estimates of economic costs of severe weather events in 2020 and 2040 in two major Canadian cities. Those forecasts account for projected effects of climate change.

Interruption Claims
Factors affecting business interruption (BI) claims in Canada include the continued move towards just-in-time inventory delivery, lower commodity prices and risk-specific policies placed by brokers. The frequency of BI claims in Canada was consistent with experience in other countries, though in Canada in recent years, about 50% of BI claims originated from natural events.

Faulty Powers
Commercial general liability insurance was never intended to cover damages caused by faulty workmanship. Although this principle has been upheld by some courts in the United States, the 2010 Progressive Homes ruling will likely prompt CGL insurers to re-evaluate decisions to deny their duty to defend.

Cargo Theft
A lack of centralized reporting makes it difficult to understand the scale and scope of cargo theft in Canada. However, existing data indicates some types of cargo - and even certain days of the week - are riskier than others.


Moves and Views

Cover Story

Claims Against Directors
Shareholders' lawsuits alleging misrepresentation, pollution clean-up orders and privacy breaches are some of the major trends that could influence directors' and officers' (D&O) liability claims in Canada, experts suggest. The Supreme Court of Canada in December paved the way for class action lawsuits against a major Canadian bank and a motion picture firm - as well as directors and officers of each firm - arising from a drop in share price. Meanwhile, a clean-up order issued to directors of an insolvent Ontario manufacturer "set off alarm bells" among corporate directors, one lawyer reports.


Up for the Challenge
Patrick O'Hara, president of the Canadian Insurance Claims Managers Association, is hoping to continue efforts to beef up education and attract more young people to the profession.