Insurance Contracts: No Harm, No Foul in Negligence; Insurance Contracts Are No Exception

August 19th, 2013 by Meliha Waddell

This blog is written by our law summer student, Michelle Stephenson.

The Ontario Court of Appeal has dismissed a negligence suit against Meloche Monnex Insurance Company over causation.

The appellant in this case had purchased automobile coverage from the company. They had, however, failed to give him the option of income replacement benefits in addition to his regular coverage.

After unfortunately finding himself in need of such a benefit, the appellant sued the insurer in negligence for failing to offer him it in the first place.

Though the insurance company did owe the defendant a duty of care, and had breached their standard of care when they failed to inform him of this option, the court held that this was not the actual cause of the appellant’s loss.

To receive damages in negligence, the appellant would have had to show that his loss resulted from the company’s failure to offer him the additional benefits.

Given his history of never purchasing this kind of coverage and his wife previously stating that they did not need it, the court found that he likely would still not have bought it, had he been given the option.

The court held that, contrary to the appellant’s claims, causation must be shown even in actions against insurance brokers. Even though the insurer was in the wrong, this blunder was not the cause of the appellant’s predicament, and the company was not held liable.

Link to the full decision on Insurance Contracts: No Harm No Foul In Negligence at

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