If notifying an insured of cancellation of coverage by registered mail, the onus to prove that the mail reached the post office is on the insurer

Insurance law – Automobile insurance – Cancellation of policy, time cancellation in effect – Rights and duties of insurer – Interprovincial issues

McBrien v. Insurance Corp. of British Columbia, [2018] B.C.J. No. 611, 2018 BCSC 553, British Columbia Supreme Court, April 6, 2018, L.A. Warren J.

Following a motor vehicle accident, the insurer argued it had cancelled coverage for a vehicle prior to accident for which two passengers were claiming benefits. The insurer claimed it sent a letter by registered mail to the insured advising that his automobile insurance policy was cancelled for non-payment of premium. The Alberta Insurance Act allows an insurer to terminate a policy by giving the insured 15 days’ notice of termination by registered mail, with the 15-day period commencing on the day following the receipt of the registered letter at the post office to which it is addressed.

There was no direct evidence that the insured received the letter. The insurer did not receive notice of non-delivery from Canada Post. However, when it attempted to trace the delivery, the insurer received a notice of service failure that included “no article scanned” and “loss of article”. The Court was not satisfied that the insurer had established that the cancellation letter was received at the post office at which it was addressed. The Court held that the insurer had not established that the 15-day notice period expired prior to the motor vehicle accident. The risk of the mail is on the insured once it arrives at the post office to which it is addressed but the risk is on the insurer until it arrives at that post office.

This case was digested by Dionne H. Liu, and first published in the LexisNexis® Harper Grey Administrative Law Netletter and the Harper Grey Administrative Law Newsletter.  If you would like to discuss this case further, please contact Dionne H. Liu at dliu@harpergrey.com.

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