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Insurance - Commercial General Liability Clauses. Ontario v. St. Paul Fire and Marine Insurance Company
In Ontario v. St. Paul Fire and Marine Insurance Company (Ont CA, 2023) the Court of Appeal discusses time-tested CGL ('Commercial General Liability') clauses, adopted by the Insurance Bureau of Canada and often (though not here) embodied in insurance policies:[7] Anticipating that it would have insurance coverage for the claims made in the underlying action, Ontario provided notice of the claim to St. Paul, which had issued two successive general liability commercial policies to Ontario during the period contemplated by the underlying action. Of note, neither of these two policies was a standard form commercial general insurance (“CGL”) policy adopted by the Insurance Bureau of Canada. The First Policy included coverage of $20,000,000 for each “occurrence” from March 31, 1998, to March 31, 2003. Under the Second Policy, which operated from March 31, 2003, to March 31, 2005, Ontario was self-insured for the first $5,000,000, described in the Second Policy as the “Ultimate Net Loss”, while St. Paul provided insurance of $15,000,000 for each “occurrence” in “excess of the Ultimate Net Loss”.
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[46] A comparison to CGL policies is instructive in this regard. When it is intended to exclude damages for physical and psychological injury from Personal Injury claims under a CGL policy, the definition of Personal Injury explicitly states, “other than bodily injury”. Where this is the case, claims for physical and psychological injury must be analyzed under the terms of the policy applicable to Bodily Injury: Craig Brown et al., Insurance Law in Canada, loose-leaf (Toronto: Thomson Reuters Canada Ltd., 2023), at 18:65 and 18:66; Gordon G. Hilliker, Liability Insurance Law in Canada, 7th ed. (Toronto: Butterworths, 2020) at pp. 358-59. In my view, since the definitions of Personal Injury in the policies in this case do not include the words “other than bodily injury”, or any similar limitation, and since claims related to covered intentional acts are defined as Personal Injury claims under the policies, a claim alleging physical and psychological injury resulting from the commission of a covered intentional act falls within Personal Injury coverage. The application judge therefore erred in treating the underlying claims as Bodily Injury claims for the purpose of determining coverage under the policies.
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