Canada: Insurance Legislation - David Breslin - ThinkHouse March 2016 (Video Content)

Last Updated: April 25 2016
Article by David Breslin

This ThinkHouse session is also available as a podcast.

Michael Luckman: Well after 100 years we've got an entirely new Insurance Act that's going to change the way in which business insurance is going to operate. David Breslin, one of our partners specialising in insurance, is going to take us through some of the detail.

Well, thank you for coming along David - you're our man on insurance. Can you tell me why, after 106 years, we've got a new legislation on insurance?

David Breslin: Well, it seems like a long time doesn't it Michael but, in fact, the 1906 Act itself was a codifying Act so it encompassed decades of existing insurance legislation into that one Act. It really has stood the test of time actually - over 100 years. It's covered more than just marine insurance. It covers the entire marine/non-marine, in fact, insurance contracting generally in the UK so it's been a pretty decent Act for that period of time. The change has not been fast admittedly. The Law Commission started its reports and its assessment in 2006 so it's been 10 years in the coming but the changes are significant and, I think, it's important that they are considered by all businesses.

Michael: So when will the new Act begin to apply to businesses?

David: Well, the legislation itself came in last year in February 2015 and that was after 10 years of consultation through the Law Commission but it doesn't take effect for another 18 months so it becomes effective in August 2016 this year, 12 August. So that means that any contracts entered into after that date are going to be affected by the new Act.

Michael: So how does the new Act apply?

David: Well, the new Act applies to all business insurance contracts and that's important to understand that it is business insurance contracts rather than consumer contracts. It applies to all business insurance contracts entered into after 12 August 1996 and those that are subject only to English law. It's not a retrospective Act, in that sense, so it doesn't apply to existing contracts.

Michael: So what are the key changes?

David: Well, there are a number of changes but, I would say, the major changes are, there are four in fact, there is a new duty of fair presentation and that's a duty on the insured to make a fair presentation of his risk to the insurer.

There is a new duty to carry out a reasonable search and that's a very interesting new concept for an insured to grasp in the new legislation - he has to carry out a reasonable search for information which he must give in his fair presentation to the insurer.

There are some changes as to what happens if you breach the new duty of fair presentation and there are some changes as to how breach of warranties are dealt with in the new Act and those, I think, are the major changes that we're going to see.

Michael: So how does the old duty of disclosure change?

David: Well, it's important to understand that the insurance contracts as contracts of utmost good faith doesn't change - that still continues to exist in a modified form but the old duty of disclosure changes into a duty to make a fair presentation of the risk and that's a very important change for business because the old duty only gave the insured one opportunity to present their information to the insured and any breach of that information could lead to a complete avoidance of the policy. The changes to the duty of fair presentation now give the insurer more options.

Michael: So, you mentioned a reasonable search - can you give me a bit more detail on that please?

David: Yes, I mean the reasonable search is one of the most significant changes in the new Act - it gives the insured a positive duty to carry out a reasonable search of his business in order to obtain information and that information is the information which will comprise what he presents to the insurer as his fair presentation so it's extremely important. It will scope the knowledge of the insured.

Now, knowledge in the Act is talked about in two ways. One is an actual knowledge of the insured and another is deemed knowledge - what he ought to know in the course of his business and those two are defined further in the Act, the actual knowledge is considered to be the actual knowledge of senior management in the business and the deemed knowledge is knowledge that can be obtained by reasonable search and so that's how a reasonable search becomes very important to the, to businesses who are purchasing insurance after August 2016.

Michael: I understand the remedies for breach of warranty are changing - is this helpful to the insured?

David: Well, it is. The breach of warranty remedies that currently exist have always been considered to be slightly unfair and very much weighted towards the insurer. The way the existing law works is that any breach of an insurance warranty whether it relates to the loss can give rise or does give rise to automatic termination of the policy going forward and that's always been considered to be a very draconian remedy available to the insurers. The position now changes - the breach of warranty, if it occurs, can be remedied under the new Act and it previously couldn't and all breaches of warranty under the new Act are considered suspensory in nature so they can be remedied prior to a loss taking place.

Michael: So how should General Counsel prepare their businesses for the new Act?

David: Well, I think, that General Counsel should be very clear that it's an important new Act for business and that they do need to make some preparations in advance of August 2016. They need to look at their existing insurance policies and they need to identify how they are going to make their duty of fair presentation on their new renewals.

Now, they can take some steps in advance of that. The key changes are going to be in relation to what their actual knowledge and what their deemed knowledge is and how you conduct a reasonable search and they can agree with insurers or, at least, can certainly look to agree with insurers the scope of the actual knowledge - who in the business has that actual knowledge? It's defined in the Act as senior management so an insured should identify who, in his senior management, he is going to assess in terms of their actual knowledge. On the reasonable search side, it's going to be different for a small sole trader business than it is going to be for a multi-national corporation and, equally, the scope of a reasonable search can be agreed or looked to be agreed with the insurer so that there is no debate subsequently as to whether or not the right processes have taken place.

Michael: That was very interesting David. Thank you very much.

David: Thank you Michael.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions