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Three words to avoid broker liability: document, document, document

Case citation: Carriere de Davide v. Westland Insurance Group Ltd. 2024 BCSC 686 

An insurance broker negligence claim arose from a motor vehicle accident involving an underinsured motorist.  The decision of the British Columbia Supreme Court in Carriere de Davide v. Westland Insurance Group Ltd., 2024 BCSC 686 shows why brokerages should establish habits for client discussions.

The plaintiff, Mark Carriere de Davide, was catastrophically injured.  The defendant, Westland Insurance Group Ltd. was a brokerage selling Insurance Corporation of British Columbia Autoplan policies.  Mr. de Davide alleged that Westland failed to give him adequate advice about Underinsured Motorist Protection coverage.  He alleged he was entitled to increased coverage from $1 million to $2 million because this excess coverage was never explained to him.

En route from Whistler to Vancouver, Mr. de Davide had been riding as a passenger in his then-girlfriend’s Pontiac Grand Am.  She carried only $200,000 worth of third-party liability insurance.  When the Pontiac was approximately 30 km south of Squamish, it rounded a curve in a 60 km/h speed zone. The driver oversteered, causing the Pontiac to spin into the northbound lane where it struck another vehicle. The driver of the car Mr. de Davide was riding in was at fault.  With his existing UMP coverage, Mr. de Davide received approximately $665,000 in compensation from ICBC. This amount was much less than what he estimated was his actual loss resulting from the accident.

Mr. de Davide sued Westland for not having properly counselled him about the benefits and costs of excess UMP coverage.  Unfortunately, neither the broker nor Mr. de Davide remembered their actual discussion at the point of sale.  Mr. de Davide argued that if he had understood that he could get an extra $1 million worth of UMP for just $25, he would certainly have bought it. Because he did not buy it, he surmised the agent must not have offered and sufficiently explained it to him.

Westland’s broker who sold Mr. de Davide the policy was Ashley Ouellette.

As for Westland’s applicable standard of care, this required Ms. Oullette to offer Mr. de Davide excess UMP, and to explain its benefits and costs, but did not require that she recommend that it be purchased.  In addition, to establish negligence in these circumstances required the damage was caused by Westland’s breach.

The extent of the duty owed by an insurance agent, both in placing insurance and in indicating to the insured which risks are covered and which are not, is a fairly stringent one for the agent.  As well, where the customer described their situation, the onus is on the broker to review the customer’s insurance needs and to provide the full coverage requested. Should an insured loss nevertheless occur, the insurance broker will be liable unless it points out the gaps in coverage to the customer and provides advice on how to protect against those gaps.

The Court found for the brokerage for three reasons:

  • it was a procedural habit for Westland’s brokers to discuss excess UMP with clients;
  • the insurance contract included Mr. de Davide’s signed acknowledgment that he declined excess UMP; and
  • Mr. de Davide’s purchase history indicated he had declined excess UMP coverage in 16 previous sales transactions.

The Court rejected Mr. de Davide’s assertion that the fact that he did not purchase excess UMP is effective proof that such coverage must not have been offered and properly explained to him.  This assertion amounted to an invitation to the Court to apply the maxim of res ipsa loquitur (“the thing speaks for itself”), which the Supreme Court of Canada finds inapplicable. Furthermore, the Court said standard practice evidence will not necessarily be discounted because of a lack of corroboration through business records.

The Court found Ms. Oullette had likely told Mr. de Davide about the option, and he had declined it.  There was no breach of the applicable standard of care by Westland. 

As for whether Westland had caused injury to Mr. de Davide, this was a modified objective test that requires the court to consider what a reasonable person in the circumstances of the plaintiff would have done if faced with the same situation, while taking into account the plaintiff’s particular concerns and special considerations that affect them specifically.  As such, it differs from a purely objective test.

In this case, but for the manner in which Ms. Ouellette advised Mr. de Davide regarding his UMP coverage options, would Mr. de Davide have purchased excess UMP rather than being content with basic UMP?  The Court refused to find if there had been active encouragement by Ms. Ouellette to buy the excess UMP, a reasonable person in Mr. de Davide’s circumstances with his individual concerns and considerations would likely have purchased $2 million worth of UMP coverage.  Amongst other facts demonstrating that Mr. de Davide was an independent-minded individual, the Court noted he had been buying Autoplan policies since 2006, consistently declining excess UMP coverage each time. Thus, this element of Mr. de Davide’s negligence claim was not established resulting in dismissal of the claim against Westland.

For brokers, Carriere de Davide v. Westland Insurance Group Ltd. encourages creating and then following through with routine standard practice when serving clients.  Doing so will assist the defence when such negligence claims arise.


Should you have any questions with respect to this bulletin, or if you would like more detailed information related to broker liability, please contact Michael Colwell with the Brownlee LLP Insurance Practice Team:

Michael Colwell


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