Canada: Case Summary: Enterprise Rent-A-Car v Intact Insurance

Last Updated: March 11 2019
Article by Field LLP

The legislation setting out priorities among insurers in a rental/leased vehicle situation only applies to those polices which provide coverage and the term "listed driver" in an auto policy is not "an insured named in the contract".

Enterprise Rent-A-Car v. Intact Insurance, 2018 ONSC 3517 (Divisional Court), per Conway, J. [4300]


On June 29, 2013, Perets was involved in a motor vehicle accident while operating a vehicle she had rented from Enterprise Rent-A-Car (Enterprise). At the time, she lived with her parents and was insured under her father's Standard Ontario Auto Policy (OAP 1) issued by Intact Insurance for the two vehicles she regularly drove. She was a "listed driver" under the Intact policy, but was not a named insured.

Section 2.2.4 of Perets' OAP 1 provides that coverage for rental vehicles exist only when rented by the named insured: 

Automobiles, other than a described automobile, are covered as described in this subsection when rented by you, or by your spouse who lives with you, for periods of not more than 30 days, but only with respect to the liability of the person renting the automobile arising from the negligence of the driver of that automobile... 

In June 2015, Perets was sued for the accident. Enterprise agreed to defend her under a reservation of rights letter until the priority dispute among the insurers involved could be resolved. In October 2017 the action was settled and $30,000 was contributed by Enterprise on behalf of Perets.

Enterprise brought an application for a declaration that Intact was the "first loss" insurer pursuant to the Ontario Insurance Act, R.S.O. 1990, c. I.8 section 277(1.1) and sought indemnity from Intact for the amount paid by way of the settlement.

Ontario s. 277(1.1) enunciates the order in which multiple auto insurance policies are to respond in a rental vehicle situation, as follows: 

  1. Firstly, insurance available under a contract evidenced by a motor vehicle liability policy under which the lessee of the automobile is entitled to indemnity as an insured named in the contract. 
  2. Secondly, insurance available under a contract evidenced by a motor vehicle liability policy under which the driver of the automobile is entitled to indemnity, either as an insured named in the contract, as the spouse of an insured named in the contract who resides with that insured or as a driver named in the contract, is excess to the insurance referred to in paragraph 1. 
  3. Thirdly, insurance available under a contract evidenced by a motor vehicle liability policy under which the owner of the automobile is entitled to indemnity as an insured named in the contract is excess to the insurance referred to in paragraphs 1 and 2.

The application judge dismissed Enterprise's application, holding that the Intact policy did not provide coverage to Perets with respect to the rental vehicle and, accordingly, priority provisions of section 277(1.1) of the Insurance Act did not apply.

Enterprise appealed. It argued that the application judge errored in concluding that Perets was not "an insured named in the contract" or "a driver named in the contract".

HELD: For Enterprise; appeal dismissed. 

The Divisional Court held that insurance under the Intact policy issued to Perets' father was not "available" to Perets, since she was a listed (but not a named) insured, concluding that section 2.2.4 of the OAP 1 provided coverage for rental vehicles only to the named insured:

[11]    Section 2.2.4 of the OAP 1 provides that liability coverage is available for rental vehicles, but only when rented by "you" (defined in s. 1.3 as the named insured) or your spouse:

Automobiles, other than a described automobile, are covered as described in this subsection when rented by you, or by your spouse who lives with you, for periods of not more than 30 days, but only with respect to the liability of the person renting the automobile arising from the negligence of the driver of that automobile...

[12]    The term "named insured" means the person or entity in whose name the policy is issued: Portch v. Markel Insurance Co. of Canada, 1996 CarswellOnt (Ont Insurance Comm.), para 82. In this case, Ms. Perets' father was the named insured. She was a "listed driver" only.

[13]    Since Ms. Perets was not the named insured or his spouse, under the clear and unambiguous language of the OAP 1 she was not covered for a rental vehicle: see Ontario (Minister of Finance) v. Intact, 2013 ONSC 1457, paras. 32-34.

The Court rejected Enterprise's argument that there was a discrepancy between the wording of the OAP 1 and the Insurance Act, and that the statutory language should prevail in Enterprise's favour. The Court noted that the priority provisions of the Insurance Act only apply where the policy provides coverage and that the Act does not purport to create insurance coverage where none is available:

[15]    We reject these submissions. First, we see no conflict between the interaction of s. 277(1.1) of the Act and terms of the Policy. Section 277(1.1) only applies if indemnity under a policy is available. That availability must first be determined according to the terms of the policy. If coverage is not available under those terms, the statutory provisions do not come into play.

[16]    Second, s. 277(1.1) of the Act simply sets out the priority ranking of the various insurance coverage that is available where a rental car is involved in an accident. It does not purport to create insurance coverage where none is available. In this case, it is clear that insurance coverage was not available to Ms. Perets for the rental car since she was only a listed driver under the Policy. Section 277(1.1)(2) therefore did not apply and it fell to Enterprise's insurer to provide coverage for the accident.


Although the Ontario Insurance Act priority provisions with respect to rental vehicles are somewhat different (and definitely less complex) than those set out in the Alberta legislation (the Insurance Act, R.S.A 1980, c. I-3, section 596 and the Miscellaneous Insurance Provisions Regulation, Alta Reg 120/2011, section 7.1), these principles should apply in Alberta. Accordingly, for an insurer to even have standing to be considered for priority, it must provide coverage to the party specified in the legislation. Also, the term "insured named in a contract" means the named insured and not a listed driver (such as a principal or occasional driver).

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.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Sign Up
Gain free access to lawyers expertise from more than 250 countries.
Email Address
Company Name
Confirm Password
Mondaq Newsalert
Select Topics
Select Regions
Registration (please 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