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NEWFOUNDLAND AND LABRADOR
REGULATION 81/04

Automobile Insurance Regulations
under the
Automobile Insurance Act
(O.C. 2004-296)

Amended by:

51/05
65/05

NEWFOUNDLAND AND LABRADOR
REGULATION 81/04

Automobile Insurance Regulations
under the
Automobile Insurance Act
(O.C. 2004-296)

(Filed July 28, 2004 )

Under the authority of paragraphs 60(1)(g.1) and (g.2) of the Automobile Insurance Act , the Lieutenant-Governor in Council makes the following regulations.

Dated at St. Johnís , July 28, 2004 .

Robert C. Thompson
Clerk of the Executive Council

REGULATIONS

Analysis



Short title

††††††† 1. These regulations may be cited as Automobile Insurance Regulations .

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Definitions

††††††† 2. In these regulations, "Act means the Automobile Insurance Act .

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Application

††††††† 3. These regulations apply to an action arising from the use or operation of an automobile on or after August 1, 2004 .

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Net loss of income

††††††† 4. For the purpose of paragraph 26.4(1)(a) of the Act, net loss of income means total income lost less the following:

†††††††††††† (a) the premium otherwise payable on that income under the Employment Insurance Act ( Canada );

†††††††††††† (b) the contribution otherwise payable on that income under the Canada Pension Plan ( Canada ); and

†††††††††††† (c) the income tax otherwise payable on that income under the Income Tax Act ( Canada ) and the Income Tax Act, 2000.

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Net loss of earning capacity

††††††† 5. For the purpose of paragraph 26.4(1)(b) of the Act, net loss of earning capacity means total loss of earning capacity or loss of future income less the following:

†††††††††††† (a) the premium otherwise payable on that income under the Employment Insurance Act ( Canada );

†††††††††††† (b) the contribution otherwise payable on that income under the Canada Pension Plan ( Canada ); and

†††††††††††† (c) the income tax otherwise payable on that income under the Income Tax Act ( Canada ) and the Income Tax Act, 2000.

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Deductible on non-pecuniary damage

††††††† 6. For the purpose of section 39.1 of the Act, the amount by which the damages to which a plaintiff is entitled in relation to each cause of action for non-pecuniary loss or damage shall be reduced is $2,500.

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Appropriateness of rate

††††††† 7. (1)† For the purpose of subsection 49(2) of the Act, the board shall determine if a proposed rate is too high.

†††††††††††† (2) The board shall vary or prohibit a rate that it determines is too high.

†††††††††††† (3) A rate approved by the board comes into effect on the date approved by the board.

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Appropriateness of increase

††††††† 8. (1)†Where a rate filed by an insurer under section 51of the Act constitutes an increase in a rate previously filed, the board shall determine if the proposed rate is too high.

†††††††††††† (2) The board shall vary or prohibit a rate that it determines is too high.

†††††††††††† (3) A rate approved by the board comes into effect on the date approved by the board.

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Effective date of rate reduction

††††††† 9. (1)†Where a rate filed by an insurer under section 51 of the Act constitutes a reduction in a rate previously filed, the new rate takes effect 30 days after the filing has been received by the board or a later date as set out in the filing.

†††††††††††† (2) The board shall forward to the Superintendent of Insurance a notice of a rate reduction filed with the board under subsection (1), and the notice shall be in the form determined by the superintendent.

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Appropriateness of rate

††††† 10. (1)†For the purpose of subsection 62.1(4) of the Act, the board shall determine if a proposed rate is too high.

†††††††††††† (2) The board shall vary or prohibit a rate that it determines is too high.

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Board to assess grounds of rate increase

††††† 11. (1)†For the purpose of subsections 7(1), 8(1) and 10(1), the board shall determine if the insurerís proposed rate is in excess of that which is required or justified on the basis of the insurerís projected loss experience, expenses and investment income for its automobile insurance business for the province and other elements considered appropriate by the board.

†††††††††††† (2) The board shall in its determination under subsection (1) ensure that the projected loss experience takes into account the insurerís loss experience in the province where that experience is relevant, adequate or otherwise reasonable for use in establishing rates.

†††††††††††† (3) Where the board determines that an insurerís loss experience in the province is not relevant, inadequate or otherwise unreasonable for use in establishing rates, the board shall determine the elements and information upon which an insurer shall file its projected loss experience with the board.

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Time limit on board

††††† 12. (1)†For the purpose of section 53 and subsection 62.1(4) of the Act, the board shall approve, vary or prohibit a rate filed within 90 days from the date the board receives the filing.

†††††††††††† (2) Notwithstanding subsection (1), where the board determines that it is not reasonably possible for it to comply with the 90 day time frame, the board shall so notify the company involved and provide a time period when a decision may be made.

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Form and timing of rate filings

††††† 13. The board may determine the manner and timing of the rate filings that an insurer shall file with the board.

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Insurer to provide information

††††† 14. (1)† For the purpose of paragraph 60(1)(d.3) of the Act, an insurer shall disclose to a person who is or alleges he or she is entitled to recover from an insured covered by a motor vehicle liability policy or under a contract of automobile insurance the following:

†††††††††††† (a) that under the Personal Information and Electronic Documents Act ( Canada ) an insurance company

††††††††††††††††††††† (i) is permitted to conduct surveillance of a claimant without the claimantís consent or knowledge,

†††††††††††††††††††† (ii) does not have to disclose to a claimant that he or she is or has been under surveillance, and

††††††††††††††††††† (iii) is required to destroy personal information collected about a claimant through surveillance after it has fulfilled its usefulness;

†††††††††††† (b) that it is an offence under the Criminal Code to make a false claim;

†††††††††††† (c) that a person found guilty of making a false claim may be subject to a fine or imprisonment for a period of time, or to both a fine and imprisonment;

†††††††††††† (d) that a false claim includes inflating the true value of a claim or claiming for things that were not damaged in an accident;

†††††††††††† (e) that where the claimant is making a claim against another driver who allegedly caused the accident, that driverís insurance company is obligated to

†††††††††††††††††††††††††††††††††

††††††††††††††††††††† (i) settle the claim as quickly as possible,

†††††††††††††††††††† (ii) make interim payments to the claimant pending the final settlement of the claim once the insurance company has determined that its insured is at-fault for the accident,

††††††††††††††††††† (iii) pay the claimant the amount of the final claim settlement in a series of payments over a stated period of time instead of in one lump where the accident caused the claimant bodily injury and the claimant requests his or her settlement in periodic payments,

††††††††††††††††††† (iv) advise its insured that a claim has been made against him or her, and

††††††††††††††††††† (iv) advise its insured of the total amount paid to the claimant once the claim is settled;

††††††††††††† (f) that where the claimant was not wearing a seat belt at the time of the accident and by law he or she was required to wear one, the claim will be reduced by 25% unless the claimant can prove that his or her injuries would be the same had he or she being wearing a seat belt;

†††††††††††† (g) that a claim for loss of income or loss of ability to earn income will be reduced by Employment Insurance premiums, Canada Pension Plan contributions and income tax that would otherwise be payable if the claimant received the income from employment; and

†††††††††††† (h) that a claim for non-pecuniary loss or damage will have a $2,500 deductible applied to it.

†††††††††††† (2) An insurer shall make reasonable efforts to ensure that confirmation of receipt of this disclosure is received back from the claimant and maintained on its files.

†††††††††††† (3) Subsections (1) and (2) do not apply to an insurer where a claim is made against the insurer for glass breakage under the comprehensive coverage of Section C of the Automobile Insurance Policy.

†††††††††††† (4) For the purpose of paragraph 60(1)(d.4) of the Act the disclosure required under subsection (1)

†††††††††††† (a) shall be in the form approved by the Superintendent of Insurance;

†††††††††††† (b) shall be made immediately upon the insurance company or its adjuster, representative, agent or broker becoming aware of the claimantís name and contact information; and

†††††††††††† (c) shall include a requirement that the claimant confirm receipt of the disclosure to the insurance company, but, where the claimant refuses to or does not confirm receipt it shall not constitute an offence or affect his or her claim.

†††††††††††† (5) Notwithstanding subsection (4), disclosure may be made by electronic means provided the insurance company receives electronic confirmation of delivery of the disclosure from the claimant and that both the disclosure and confirmation are maintained in a system where it is retrievable.

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Restriction on rate increase

††††† 15. Where an insurer files a proposal to increase rates with the board under section 51 of the Act, a proposed rate increase the board determines is the result of the coming into force of paragraph 4(1)(e.1) of the Automobile Insurance Prohibited Underwriting Regulations is prohibited for the 12 month period beginning on August 1, 2005 unless the insurer can demonstrate to the board that the increase is justified.

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Application of rate increase prohibited

††††† 16. A rate increase based solely on the coming into force of paragraph 4(1)(e.1) of the Automobile Insurance Prohibited Underwriting Regulations that would otherwise apply to an insured to whom subsection 4(2.1) of those regulations applies is prohibited for the 12 month period beginning on August 1, 2005 unless the insurer can demonstrate to the board that the increase is justified.

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