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Insurance - Life. Costanza v. Desjardins Financial Security Life Assurance Company
In Costanza v. Desjardins Financial Security Life Assurance Company (Ont CA, 2023) the Court of Appeal reviews portions of the Insurance Act that bear on life insurance:[26] Part V of the Insurance Act governs life insurance. Sections 178 to 189.1 address conditions governing formation of the insurance contract. Section 183 codifies the duty of disclosure on an applicant for insurance at the time of the application (and at the time of some subsequent applications to vary an insurance contract) as well as the consequences of failure to disclose or misrepresentation. Section 183 provides as follows:Duty to disclose
183 (1) An applicant for insurance and a person whose life is to be insured shall each disclose to the insurer in the application, on a medical examination, if any, and in any written statements or answers furnished as evidence of insurability, every fact within the person’s knowledge that is material to the insurance and is not so disclosed by the other.
Failure to disclose
(2) Subject to section 184 and subsection (3) of this section, a failure to disclose, or a misrepresentation of, such a fact renders the contract voidable by the insurer.
Failure to disclose, application for change, etc., in contract
(3) A failure to disclose, or a misrepresentation of, a fact referred to in subsection (1) relating to evidence of insurability with respect to the following kinds of applications renders the contract voidable by the insurer, but only in relation to the addition, increase or change applied for:
1. For additional coverage under a contract.
2. For an increase in insurance under a contract.
3. For any other change to insurance after the policy is issued.
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