2018 BILL 3

	3


Fourth Session, 48th General Assembly 68 Elizabeth II, 2019
BILL 3
AN ACT TO AMEND THE AUTOMOBILE INSURANCE ACT
Received and Read the First Time................................................................
Second Reading............................................................................................
Committee.....................................................................................................
Third Reading...............................................................................................
Royal Assent.................................................................................................
HONOURABLE SHERRY GAMBIN-WALSH Minister of Service Newfoundland and Labrador
Ordered to be printed by the Honourable House of Assembly

EXPLANATORY NOTES

This Bill would amend the Automobile Insurance Act to

· add a definition of "accident benefits";

· require that an insurer notify the Registrar of Motor Vehicles of the cancellation or expiration of a policy issued by the insurer;

· require a person who intends to commence an action for loss or damage from bodily injury or death arising directly or indirectly from the use or operation of an automobile to provide notice to the person against whom the action will be commenced and to satisfy other requirements before commencing the action;

· provide that damages to which a plaintiff is entitled in an action for loss or damage from bodily injury or death arising directly or indirectly from the use or operation of an automobile be reduced by the accident benefit payments received by the plaintiff or to which the plaintiff is entitled;

· add direct compensation for property damage coverage which would allow a driver involved in an accident who is not at fault to seek reimbursement for damages to his or her automobile directly from his or her own insurer rather than from the insurer of the driver who was at fault;

· allow a person who has accident benefits and who sustained a type of injury prescribed in the regulations to elect to be treated in accordance with the diagnostic and treatment protocols prescribed in the regulations;

· prohibit the owner or driver of an uninsured automobile from applying to the Facility Association for payment of damages for injuries arising out of the operation, care or control of an automobile;

· allow the Lieutenant-Governor in Council to require rate reductions in the case of automobiles equipped with winter tires;

· allow the Lieutenant-Governor in Council to require rate reductions in the case of automobiles equipped with technology that monitors vehicle usage and driver behaviour;

· allow the Lieutenant-Governor in Council to prescribe the time period in which an insurer is required to file its rates with the Public Utilities Board;

· allow the Lieutenant-Governor in Council to exempt an insurer from the requirement to file its rates with the Public Utilities Board;

· require that the Public Utilities Board publish the information prescribed in the regulations respecting decisions or orders of the Public Utilities Board in the manner and time period prescribed by the regulations; and

· require that the minister consider every 5 years whether a review of the Act, the regulations or other matters related to automobile insurance is necessary.

A BILL

AN ACT TO AMEND THE AUTOMOBILE INSURANCE ACT

Analysis

1. S.2 Amdt.
Definitions

2. S.6.01 Added
Duty to notify Registrar of Motor Vehicles

3. S.25.1 Added
Notice and disclosure before action

4. S.26.6 Added

Damages reduced by accident benefits payments

5. S.32.1 Added

Direct compensation for property damage

6. S.34.1 Added
Diagnostic and treatment protocols

7. S.45.1 Amdt.
Application

8. S.49 Amdt.
Insurer to file rates

9. S.55.1 Added

Publication

10. S.60 Amdt.
Regulations

11. S.64 Added

Review

12. Commencement

Be it enacted by the Lieutenant-Governor and House of Assembly in Legislative Session convened, as follows:

RSNL1990 cA-22
as amended

1. Subsection 2(1) of the Automobile Insurance Act is amended by renumbering paragraph (a) as paragraph (a.1), renumbering paragraph (a.1) as paragraph (a.2) and adding immediately before paragraph (a.1) the following:

(a) "accident benefits" means Section B Accident Benefits as set out in S.P.F. No. 1 Standard Automobile Policy;

2. The Act is amended by adding immediately after section 6 the following:

Duty to notify Registrar of Motor Vehicles

6.01 (1) An insurer shall notify the Registrar of Motor Vehicles of the cancellation or expiration of a policy issued by the insurer for the type or use of vehicle prescribed in the regulations.

(2) A notice required under subsection (1) shall be provided in writing and in the time period prescribed in the regulations.

3. The Act is amended by adding immediately after section 25 the following:

Notice and disclosure before action

25.1 (1) Where a person intends to commence an action for loss or damage from bodily injury or death arising directly or indirectly from the use or operation of an automobile, the person shall

(a) serve written notice of the intention to commence an action on the insured within 120 days after the accident;

(b) provide the insurer with the information and documentation prescribed in the regulations within the time period prescribed in the regulations;

(d) provide the insurer with a statutory declaration describing the circumstances surrounding the accident and the nature of the claim being made, where requested by the insurer;

(e) participate in the case management process established in the regulations;

(f) undergo an examination by classes of persons prescribed in the regulations, where requested by the insurer and at the insurer's expense; and

(g) provide evidence of his or her identity, where requested by the insurer.

(2) Notwithstanding subsection (1), a person referred to in subsection (1) may apply to the Supreme Court for an extension of the notice period referred to in paragraph (1)(a).

(3) A notice under paragraph (1)(a) shall advise the insured of his or her duty under section 29 to give written notice to his or her insurer within 5 days after service of the notice.

(4) Paragraph (1)(c) only applies where the person referred to in subsection (1) has access to accident benefits.

(5) An examination under paragraph (1)(f) shall not be unnecessarily repetitious and shall not involve a procedure that is unreasonable or dangerous.

(6) A person examined under paragraph (1)(f) shall answer the questions of the examiner relevant to the examination.

(7) Where a person who performs an examination under paragraph (1)(f) provides a report to the insurer, the insurer shall ensure that the person referred to in subsection (1) receives a copy of the report within 60 days after the insurer receives the report.

(8) In an action for loss or damage from bodily injury or death arising directly or indirectly from the use or operation of an automobile, pre-judgment interest shall not be awarded under section 3 of the Judgment Interest Act for any period of time before the notice under paragraph (1)(a) is served.

(9) Where a person contravenes subsection (1), the court shall consider the contravention in awarding costs.

(10) In this section, "insurer" means the insurer of an insured against whom a person referred to in subsection (1) intends to commence an action.

(11) This section applies only in relation to loss or damage sustained on or after the date this section comes into force.

4. The Act is amended by adding immediately after section 26.5 the following:

Damages reduced by accident benefits payments

26.6 (1) In an action for loss or damage from bodily injury or death arising directly or indirectly from the use or operation of an automobile, the damages to which a plaintiff is entitled shall be reduced by the accident benefit payments

(a) received by the plaintiff; and

(b) to which the plaintiff remains entitled.

(2) This section applies only in relation to loss or damage sustained on or after the date this section comes into force.

5. The Act is amended by adding immediately after section 32 the following:

Direct compensation for property damage

32.1 (1) This section applies where

(a) an automobile or its contents, or both, suffers damage arising directly or indirectly from the use or operation in the province of one or more automobiles;

(b) the automobile that suffers the damage or in respect of which the contents suffer damage is insured under a contract evidenced by a motor vehicle liability policy issued by an insurer who is licensed to undertake automobile insurance in the province or who has filed with the superintendent, in the form approved by the superintendent, an undertaking to be bound by this section; and

(c) at least one other automobile involved in the accident is insured under a contract evidenced by a motor vehicle liability policy issued by an insurer who is licensed to undertake automobile insurance in the province or who has filed with the superintendent, in the form approved by the superintendent, an undertaking to be bound by this section.

(2) This section applies, with necessary modifications, in respect of an automobile the owner, operator or lessee of which is exempt from the requirement to be insured under the Highway Traffic Act, if the corporation that is financially responsible for the damages resulting from the accident involving the automobile files with the superintendent an undertaking to be bound by this section.

(3) Where this section applies, an insured is entitled to recover for the damages to the insured's automobile and its contents and for loss of use from the insured's insurer under the coverage described in subsection 10(1) as though the insured were a third party.

(4) Recovery under subsection (3) shall be based on the degree of fault of the insurer's insured as determined under the fault determination rules prescribed in the regulations.

(5) An insured may commence an action against an insurer where the insured is not satisfied

(a) that the degree of fault established under the fault determination rules accurately reflects the actual degree of fault; or

(b) with a proposed settlement,

and the matters in issue shall be determined in accordance with ordinary rules of law.

(6) Where this section applies,

(a) an insured has no right of action against any person involved in the accident other than the insured's insurer for damages to the insured's automobile or its contents or for loss of use;

(b) an insured has no right of action against a person under an agreement, other than a contract of automobile insurance, in respect of damages to the insured's automobile or its contents or for loss of use, except to the extent that the person is at fault or negligent in respect of those damages or that loss; and

(c) an insurer, except as permitted by the regulations, has no right of indemnification from or subrogation against any person for payments made to the insurer's insured under this section.

(7) Nothing in this section precludes an insurer, in a contract belonging to a class prescribed by the regulations, from agreeing with an insured that, in the event that a claim is made by an insured under this section, the insurer shall pay only

(a) an agreed portion of the amount that the insured would otherwise be entitled to recover; or

(b) the amount that the insured would otherwise be entitled to recover, reduced by a sum specified in the agreement.

(8) Subsection (7) does not apply unless, before the insured enters into the contract referred to in that subsection, the insurer offers to enter into another contract with the prospective insured that does not contain the agreement referred to in that subsection but is identical to the contract referred to in subsection (7) in all other respects except for the amount of the premium.

(9) In the circumstances prescribed by regulation, a contract belonging to a class prescribed by the regulations for the purpose of subsection (7) shall provide that, in the event that a claim is made by the insured under this section, the insurer shall pay only the amount that the insured would otherwise be entitled to recover, reduced by the sum specified in the contract.

(10) Subsection (8) does not apply to a contract that contains a provision required by subsection (9).

(11) Where a contract contains an agreement referred to in subsection (7) or a provision required by subsection (9), the policy shall have the words "This policy contains a partial payment of recovery clause for property damage" printed or stamped on its face in conspicuous type.

(12) This section does not affect an insured's right to recover in respect of any physical damage coverage in respect of the insured automobile.

(13) This section does not apply

(a) to damage to those contents of an automobile that are being carried for compensation;

(b) where both or all of the automobiles are owned by the same person; or

(c) to damage to an automobile owned by the insured or to its contents where the damage is caused by the insured while driving another automobile.

(14) This section applies only in relation to loss or damage sustained on or after the date this section comes into force.

6. The Act is amended by adding immediately after section 34 the following:

Diagnostic and treatment protocols

34.1 (1) Where a person referred to in paragraph 34(1)(a) or (b) sustains a type of injury prescribed in the regulations, the person may elect to be diagnosed and treated in accordance with diagnostic and treatment protocols prescribed in the regulations.

(2) Where a person referred to in subsection (1) elects to be diagnosed and treated in accordance with the diagnostic and treatment protocols established in the regulations, subsections 34(4) and (5) shall not apply in relation to the injuries diagnosed and treated in accordance with the diagnostic and treatment protocols prescribed in the regulations.

(3) This section applies only in relation to injuries sustained on or after the date this section comes into force.

7. Section 45.1 of the Act is amended by adding immediately after subsection (3) the following:

(3.1) Notwithstanding another provision of this Act, a person shall not apply to the Facility Association under section 45.2 or 45.3 for payment of damages for injuries arising out of the operation, care or control of an automobile in the province if at the time the injuries were sustained the person was the owner or driver of the automobile and the automobile was an uninsured automobile.

(3.2) Subsection (3.1) applies notwithstanding that the person who sustained the injuries

(a) may have a cause of action against an owner or a driver of the automobile; and

(b) may have had no applicable and collectable insurance at the time of the accident in which the injuries were sustained.

(3.3) Subsection (3.1) does not apply where

(a) at the time of the accident the owner of the automobile failed to maintain insurance coverage for a period of 30 days or less; and

(b) the owner of the automobile had maintained continuous insurance coverage for at least one year immediately before the failure to maintain insurance coverage.

(3.4) This section applies only in relation to injuries sustained on or after the date this section comes into force.

8. Section 49 of the Act is amended by adding immediately after subsection (1) the following:

(1.1) The Lieutenant-Governor in Council may prescribe by regulation the time period in which rates are required to be filed with the board under subsection (1).

(1.2) Notwithstanding subsection (1), the Lieutenant-Governor in Council may exempt by regulation an insurer from the requirement to file the rates it proposes to charge for automobile insurance rates with the board under subsection (1).

9. The Act is amended by adding immediately after section 55 the following:

Publication

55.1 The board shall publish the information prescribed in the regulations respecting decisions or orders of the board in the manner and time period prescribed by the regulations.

10. (1) Subsection 60(1) of the Act is amended by adding immediately after paragraph (b) the following:

(b.1) respecting rate reductions in the case of automobiles equipped with winter tires;

(b.2) respecting rate reductions in the case of automobiles equipped with technology that monitors vehicle usage and driver behaviour;

(b.3) respecting the collection and use of information obtained from the technology referred to in paragraph (b.2);

(2) Paragraph 60(1)(d.2) of the Act is repealed and the following substituted:

(d.2) delegating to the board power to make rules or policies respecting the manner of filing rates with the board;

(3) Subsection 60(1) of the Act is amended by adding immediately after paragraph (d.4) the following:

(d.5) prescribing the time period in which insurers are required to file rates with the board;

(d.6) exempting an insurer from the requirement to file rates with the board;

(4) Subsection 60(1) of the Act is amended by adding immediately after paragraph (f) the following:

(f.1) prescribing the time period in which an insurer is required to notify the Registrar of Motor Vehicles under section 6.01;

(f.2) prescribing the type or use of vehicle for the purpose of subsection 6.01(1);

(f.3) prescribing the information and documentation that a person who intends to bring the action is required to provide to an insurer under paragraph 25.1(1)(b) and the time period in which that information and documentation is to be provided to the insured's insurer;

(f.4) prescribing the classes of persons who may conduct an examination for the purposes of paragraph 25.1(1)(f);

(f.5) establishing a case management process;

(f.6) prescribing rules for determining the degree of fault in various situations for loss or damage arising directly or indirectly from the use or operation of an automobile;

(f.7) respecting indemnification and subrogation where section 32.1 applies;

(f.8) prescribing the classes of contracts for the purpose of subsection 32.1(7);

(f.9) prescribing the circumstances in which a contract belonging to a class prescribed under paragraph (f.8) is required to contain a provision described in subsection 32.1(9);

(f.10) prescribing the amount, or the minimum or maximum amount of a reduction for the purposes of paragraph 32.1(7)(b);

(5) Subsection 60(1) of the Act is amended by adding immediately after paragraph (g.2) the following:

(g.3) prescribing the types of injuries for the purpose of subsection 34.1(1);

(g.4) establishing diagnostic and treatment protocols;

11. The Act is amended by adding immediately after section 63 the following:

Review

64. (1) The minister shall, every 5 years, consider whether a review of this Act and the regulations and other matters related to automobile insurance is necessary.

(2) Where the minister determines that a review is necessary under subsection (1), the minister shall issue terms of reference to the board to conduct the review.

Commencement

12. (1) Sections 1, 2, 3, 4, 5, 8 and 9, subsections 10(1) to (4) and section 11 come into force on January 1, 2020.

(2) Section 7 comes into force on August 1, 2019.

(3) Section 6 and subsection 10(5) come into force on a day to be proclaimed by the Lieutenant-Governor in Council.