1994 Legislative Session: 3rd Session, 35th Parliament
FIRST READING


The following electronic version is for informational purposes only.
The printed version remains the official version.


HONOURABLE ELIZABETH CULL
MINISTER OF FINANCE AND
CORPORATE RELATIONS

BILL 6 -- 1994

INSURANCE AMENDMENT ACT, 1994

HER MAJESTY, by and with the advice and consent of the Legislative Assembly of the Province of British Columbia, enacts as follows:

1 Section 11 of the Insurance Act, R.S.B.C. 1979, c. 200, is amended

(a) by repealing subsection (1) and substituting the following:

(1) This section applies to a contract that

(a) provides insurance against loss or damage

(i) by fire, lightning or explosion, or

(ii) from any of the other perils referred to in section 214,

(b) provides insurance against loss of rents or profits or loss from business interruption, resulting from a peril referred to in paragraph (a), or

(c) contains a condition, statutory or otherwise, that requires that a disagreement in respect of specified matters be determined by appraisal.

(1.1) An insurer shall give notice to an insured of the availability of the appraisal process established by this Act promptly after the insurer becomes aware that,

(a) in respect of a contract referred to in subsection (1) (a) or (b), there is a disagreement between the insurer and the insured as to the value of the property insured, the value of the property saved or the amount of the loss, or

(b) in respect of a contract referred to in subsection (1) (c), there is a disagreement between the insurer and the insured as to a matter for which an appraisal is required in the contract.

(1.2) The value or amount in dispute in a disagreement referred to in subsection (1.1) (a) or the matter in respect of which there is a disagreement referred to in subsection (1.1) (b) shall, unless the insurer and the insured are able to resolve their disagreement, be determined by an appraisal under this section.

(1.3) An appraisal under this section shall not be conducted until

(a) the insured has delivered to the insurer a proof of loss, and

(b) one of the parties to the disagreement has delivered to the other a written demand for an appraisal.

(1.4) An appraisal shall be conducted under this section (a) before any recovery is made under the contract,

(b) independently of any other question, and

(c) whether or not the right to recover on the contract is disputed. , and

(b) in subsection (2) by striking out "The insured" and substituting "For an appraisal under this section, the insured".

2 Section 26 (1) is repealed and the following substituted:

(1) Where a judgment has been granted against a person in respect of a liability against which the person is insured and the judgment has not been satisfied, the judgment creditor may recover by action against the insurer the lesser of

(a) the unpaid amount of the judgment, and

(b) the amount that the insurer would have been liable under the policy to pay to the insured had the insured satisfied the judgment.

(1.1) The claim of a judgment creditor against an insurer under subsection (1) is subject to the same equities as would apply in favour of the insurer had the judgment been satisfied by the insured.

3 Section 222 is amended by striking out "in red ink" and substituting "in bold type lettering at least 12 points in size".

4 Section 225 is amended

(a) in subsection (1) by striking out ", to collect premiums, and to sign or countersign policies," and substituting "and to collect premiums,",

(b) by repealing subsection (2),

(c) in subsection (3) by striking out "signed, countersigned or", and

(d) in subsection (4) by striking out "signing, countersigning or".

5 Section 271 (4) is amended by striking out "subsection (2)," and substituting "subsection (3),". 6. Section 282 is amended

(a) in subsection (1) by striking out ", to collect premiums and to sign or countersign policies," and substituting "and to collect premiums,",

(b) by repealing subsection (2),

(c) in subsection (3) by striking out "signed, countersigned or", and

(d) in subsection (4) by striking out "signing, countersigning or".

Transitional

7 Section 11 of the Insurance Act as amended by section 1 of this Act applies to any disagreement between an insured and an insurer arising out of a loss that occurs after the coming into force of section 1.

Commencement

8 This Act comes into force by regulation of the Lieutenant Governor in Council.

 
Explanatory Notes

SECTION 1: extends the application of the appraisal process beyond contracts of fire insurance to a broader range of contracts.

SECTION 2: clarifies that a judgment creditor may, subject to the equities, claim against a judgment debtor's insurer for the lesser of the amount owing on the judgment and the amount covered by insurance if the judgment debtor was insured against the liability for which the judgment was granted.

SECTION 3: requires a clause in an insurance policy that limits liability to be in large bold type.

SECTION 4: removes the requirements for policies to be signed or countersigned in order for agents to receive their commissions.

SECTION 5: corrects a cross-referencing error.

SECTION 6: removes the requirements for policies to be signed or countersigned in order for agents to receive their commissions.

SECTION 7: is self explanatory.


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