A primary insurer does not have to provide its certificate of insurance to a secondary insurer until a condition precedent for payment of funds under the secondary coverage has occurred

Arnold v. Wawanesa Mutual Insurance Co., [2006] N.J. No. 211, Newfoundland Supreme Court

Ms. Arnold was injured in a motor vehicle accident. She commenced an action against Ms. Davidson and Ms. Davidson’s insurer, Enterprise Rent A Car Canada Ltd. (“Enterprise”). In addition, Ms. Arnold commenced an action against Wawanesa Mutual Insurance Co. (“Wawanesa”) under an SEF 44 family protection endorsement, which would provide Ms. Arnold with insurance benefits to the extent that the damages in the action that she commenced against Ms. Davidson were not covered by Ms. Davidson’s insurer, Enterprise.

Wawanesa brought an application to compel Enterprise to produce a copy of its Certificate of Insurance [ with Ms. Davidson ] in the action that Ms. Arnold had commenced against Wawanesa. The Court noted that Enterprise was not a party in that action and as such, the determination of disclosure of the Certificate of Insurance was governed by the Court being satisfied that the production of the document was necessary for disposing fairly of the proceedings or of saving costs, and was not injurious to the public interest. Enterprise opposed production of its Certificate of Insurance relying upon Peters and Fireman’s Fund Co. of Canada (1984) 45 O.R. (2d) 149 (O.N.H.C.) and Lamie v. Royal Insurance Co. of Canada [1994], N.S.J. No. 433.

Wawanesa argued that although many provinces have legislated disclosure of policy limits, in this case, Enterprise had already orally disclosed its policy limits to Wawanesa. Wawanesa was not satisfied with this disclosure and requested the actual Certificate of Insurance.

Dymond D. J noted that it was not until liability had been proven against Enterprise that Wawanesa could have any potential liability to Ms. Arnold in the action that she has commenced against them. In addition, unless Enterprise was held liable for a claim greater than its policy limits on behalf of Ms. Davidson, it would never be called upon to disclose to Wawanesa its policy coverage. Dymond J concluded that there would not appear to be a nexus that connects the application for production of Enterprise’s Certificate of Insurance to Wawanesa at this time. Dymond J determined that the present application was premature and that the Enterprise’s Certificate of Insurance was not producible to Wawanesa.

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