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Are Members of My Family Automatically Covered by My Ontario Insurance Policy?

An insurance policy issued in Ontario covers not only the insured person, but also anyone residing in their “household.” For example, let us say you are married and own a car. Your insurance policy will likely cover your spouse in the event he or she is involved in a motor vehicle accident while using your car because your spouse lives with you as a member of your household.

Case Study: Ferro v. Weiner

The Ontario Court of Appeal recently considered a personal injury case that asked the question of whether certain defendants were “living in the same household” as the insured party. This particular case, Ferro v. Weiner, actually involved a homeowner’s insurance policy, but many of the same principles apply to both homeowner’s and auto insurance coverage.

The homeowner’s policy here belonged to a now-deceased woman who owned a house on Lake Eugenia, about half an hour’s drive from Toronto. The owner originally built the lake house in the 1960s as a vacation property for her family. Later, the owner used the home as her primary residence until she retired to a nursing home sometime during 2008 or 2009.

The insurance policy for the lake house covered not just the owner but also any of her relatives “while living in the same household.” The policy itself protected against liability arising from unintentional personal injury or property damage caused by an insured person “anywhere in the world.” Coverage also extended to any insured person’s “seasonal and other residences,” provided such homes were expressly listed on the policy.

This brings us to the defendants in the present case, who are the son of the deceased homeowner and his family (i.e., his wife and daughter). In May 2010, the son and his family hosted a high school graduation party at his mother’s lake house. During the course of the party, one of the guests drowned. The family members of the drowning victim subsequently filed a personal injury against the defendants named above, as well as the estate of the deceased homeowner.

The son’s insurance company ultimately settled the personal injury plaintiffs’ claims. That insurance company then filed a motion in Ontario Superior Court seeking a judicial declaration that the estate’s homeowner’s insurance company was “bound to defend and indemnify all defendants against the claims advanced by the plaintiffs.” In other words, the son’s insurer wanted to pass the buck for liability to the mother’s insurance company, on the grounds that the son and his family were “living in the same household” as the mother at the time of the accident that killed the victim.

The judge granted the motion. The court determined the son and his family were insured under the mother’s policy. Accordingly, the judge directed the mother’s insurer to indemnify the son’s insurer for 50% of the settlement with the personal injury plaintiffs. The mother’s insurance company then appealed the judge’s ruling to the Court of Appeal.

Court of Appeal: Household is About “Community,” Not Physical Residence

The Court of Appeal ended up allowing the appeal and reversing the trial court’s judgment in favour of the mother’s insurance company. As the Court of Appeal noted, the phrase “living in the same household” is a common one used in Ontario insurance policies, so the correct interpretation of this language has “precedential value” for future cases. The trial court interpreted the phrase based on the son’s “relationship to the house” itself. That is to say, the son was not a “visitor” to the property but made regular use of it and cared for the house after his mother no longer lived there herself.

In contrast, the Court of Appeal said the proper question was whether or not the son and his family were “living in the same household” as the mother. While the son’s relationship to the house might “shed light” on this issue, it did not in and of itself answer the question. After all, someone can “be a resident in a house … without being a resident in or of a household.” For example, if you rent an apartment attached to a single-family home, the tenant is ordinarily not considered a member of the landlord’s “household,” even if they happen to be blood relatives. Indeed, in the context of insurance law the Court of Appeal said that “household” refers to a “type of community” rather than a physical residence.

In defining a “household,” the Court of Appeal said it was critical to examine the “members’ patterns of living with each other,” as well as “their settled intentions.” For instance, a university student who returns to her parents’ home during breaks is still a member of their “household,” even if she lives on campus for most of the year.

Looking at the facts of this case, the Court of Appeal noted that the mother lived in a nursing home at the time of the accident. Prior to this, she lived with another one of her children, not the son and his family. So, from the Court’s perspective, the mother maintained a “separate identity of life” from the son and her family. They were therefore not “living in the same household.” While it is possible for a person to live in two “households” at the same time, such as in the case of a minor child who splits time with both parents, that was not the situation here.

Call Preszler Law if You Need Legal Advice Following an Accident

Even in personal injury cases in which sorting out factual liability is relatively simple, the existence of multiple insurance companies often complicates matters. As the case above illustrates, it is not uncommon for insurance companies to try and shift liability to one another. This, in turn, raises complex legal issues that need to be resolved by the courts.

This is why it is essential to work with an experienced Toronto personal injury lawyer following an accident. Contact the Preszler Law Firm today to schedule a free, no-obligation consultation with one of our lawyers today.