Claims (November 01, 2008)

THINKING LIKE A JUDGE

Insurers and brokers should think more like a judge when they read or draft insurance policy contracts, because judges will ultimately determine whether or not policy coverage exists in a claim sit- uation, a litigator told brokers attending an education session at the 88th annual convention of the Insurance Brokers Association of Ontario.

Tom Donnelly, a founding partner of Thomas Gold Pettingill LLP, an insurance law firm in Toronto, made his remarks as part of his speech entitled ‘Insurance Coverage Update: Think like a Judge.’

“How many times have you had a claim where the insurance company said: ‘That claim is not covered. The policy never intended to cover that type of risk?'” Donnelly asked rhetorically.

“The key thing in the insurers’ mind is: ‘We drafted this policy. We know what’s supposed to be covered.’ The easiest thing to say is, they’re half-right.”

The part where insurers are wrong, Donnelly said, is that it’s not just their interpretation that matters. “The court is also going to look at what the policyholders’ intent was.”