Pocket bike is not an automobile for insurance purposes: FSCO arbitrator

An insurance company has won an appeal that a motorized pocket bike should not be considered an automobile for insurance purposes under the Ontario Statutory Accident Benefits Schedule (SABS).

Motors Insurance Corporation appealed the original ruling by Financial Services Commission of Ontario (FSCO) arbitrator Denise Ashby in January 2011 that a pocket bike met at least one of the three tests for classification as an automobile.

In that original ruling, Motors Insurance and Bouchard, there was an agreed statement of facts that Cassondra Bouchard was injured while riding Kristin Stratton’s uninsured pocket bike at Stratton’s property on Jan. 13, 2008.

In Adam v. Pineland Amusements Ltd., decided in 2007, the Ontario Court of Appeal developed the following three-part test to determine what is an “automobile”:

• Is the vehicle an “automobile’ in ordinary parlance? If not, then,

• Is the vehicle defined as an “automobile” in the wording of the insurance policy? If not, then,

• Does the vehicle fall within any enlarged definition of “automobile” in any relevant statute?

Ashby determined that the first two conditions did not apply in Motors Insurance, so she looked to the Off-Road Vehicles Act (ORVA). Ashby interpreted the ORVA to mean that if the pocket bike had required insurance, that would have made it an “automobile.” If so, then Bouchard should have access to accident benefits under her father’s automobile policy.

Ashby held that the pocket bike met the definition of an off-road vehicle under s. 1 of the ORVA, since it was “a vehicle propelled or driven otherwise than by muscular power or wind and designed to travel [on] not more than three wheels.” Section 15(1) of the ORVA goes on to require off-road vehicles to be insured under a motor vehicle liability policy in accordance with the Insurance Act, with the exception under s. 15(9) “where the vehicle is driven on land occupied by the owner of the vehicle.”

Ashby concluded that the pocket bike was required to be insured under the ORVA despite the time and circumstances of the incident because s. 15(9) is a “very narrow exclusion.”

However, FSCO arbitrator David Evans disagreed with this assessment in a June 20 appeal decision. He found that the pocket bike was being operated on Stratton’s property when the incident occurred. In those circumstances and at that time, the ORVA did not require Stratton’s pocket bike to be insured under an automobile insurance policy.

Therefore, Bouchard was not operating a motor vehicle and was not involved in an accident within the meaning of s. 2(1) of the SABS. The appeal was allowed in favour of Motors Insurance.