Role of ICBC in Part 7 claims
This page provides an overview of ICBC’s role as an insurer that provides no fault benefits under Part 7 of the Insurance (Vehicle) Regulation, and explains that claimants should not necessarily rely on ICBC to inform them of their rights under Part 7.
Part 7 provides first party insurance
Part 7 coverage is “first party” insurance in the sense that there is a direct relationship between the person claiming benefits (called the “insured”) and ICBC. This relationship is established by virtue of the fact that ICBC is the Crown Corporation set up in British Columbia to administer basic motor vehicle insurance, and that most people in British Columbia are covered by the definition of “insured” as set out in the Insurance (Vehicle) Regulation (see further discussion below).
Although it might not occur to most people that they might have insurance coverage without even walking into an insurance broker and paying for a policy, legislation in British Columbia provides Part 7 benefits for a wide range of people and for people within the definition of “insured” under Part 7 their rights to benefits are just as if they had walked into a broker and purchased a policy of insurance.
If a court action is required, ICBC is the defendant
When claiming Part 7 benefits the claimant is dealing directly with ICBC and if it becomes necessary to sue for a court order for payment of Part 7 benefits, it is ICBC that is named as a defendant. This is quite different the situation in tort claims where the plaintiff sues the driver who caused the accident, and names the driver personally as a defendant.
Claimants should not rely on ICBC to inform them of their Part 7 rights
Insurers owe insureds a duty of good faith and fair dealing that resembles a fiduciary duty:
However defined at this time, it is clear from these authorities that an insurer owes a yet undefined duty of good faith to its insured. It is a duty which in certain circumstances, resembles a fiduciary duty but is always governed by fair play in every dealing.
(Warrington v. Great-West Life Assurance Co., 1996 CanLII 1443 (BC CA) citing the the trial judge, whose judgment was upheld).
However, despite ICBC likely owing a duty of good faith, the law regarding the obligations of insurers (and brokers) to provide advice to clients is somewhat unclear and claimants should rather not rely on ICBC to inform them of their rights and obligations under Part 7.
In Fletcher v. Manitoba Public Insurance Co., 1990 CanLII 59 (SCC) the insureds sued a government-owned insurance company in Manitoba for failing to advise them at the time they purchased their insurance of the existence of underinsured motorist coverage. The Supreme Court of Canada held that the insurance company did owe a duty of care to inform its customers of all available insurance coverage. However, that case dealt with the duty to advise regarding available coverages at the time of taking out the policy, not the duty to advise on the types of claims that could be made after an accident, and how to protect the right to make those claims. Therefore, this case is not authority for the proposition that ICBC is required to assist injured persons wanting to make Part 7 claims by providing advice about how to advance such claims.
In McIlvenna (litigation guardian of) v. Insurance Corporation of British Columbia, 2008 BCCA 289 the plaintiff sued ICBC for failing to advise him and his mother about the kind of therapy and treatment that could be funded and that deadlines for claiming applied. ICBC applied for the claim to be struck out on the ground that it had no duty to advise a claimant on such matters, but the British Columbia Court of Appeal held that the claim should proceed to trial:
[I]n my opinion, it is not plain and obvious that the present situation is not sufficiently analogous to Fletcher for the court to recognize the duty of care in the present case. Nor is it plain and obvious, in the event Fletcher is not considered analogous, that there is insufficient proximity between the parties to give rise to a prima facie duty of care to provide advice with respect to the Part 7 benefits. It was not argued before us that broad policy considerations outside of the relationship between the parties negative the duty of care. The action is not certain to fail, and evidence at trial regarding ICBC’s policies and practices with respect to Part 7 benefits may inform the proximity issue.
(McIlvenna (litigation guardian of) v. Insurance Corporation of British Columbia, 2008 BCCA 289 at para. 50).
In other words, in the McIlvenna case the British Columbia Court of Appeal said that it was not so obvious that the claim against ICBC for not providing relevant information about Part 7 claims to the claimant would fail that a trial was not necessary, but said that the matter should proceed to trial to determine whether ICBC was in fact obligated to provide such information. However, the court in McIlvenna did not say that it was plain and obvious that ICBC did owe a duty to advise claimants on how to properly advance Part 7 claims.
The above indicates that while insurance brokers may have obligations to advise as to the types of available coverage at the time insurance is purchased, the scope of ICBC’s duty to provide information about possible claims, and deadlines that might apply, is unclear. Therefore, claimant’s should investigate what rules apply to their claims and consult a lawyer if they require legal advice.
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