The insured sought reimbursement of defence costs incurred in responding to Human Rights Tribunal proceedings, arguing that information disclosed in a policy renewal application constituted notice of a claim under a “claims made and reported” liability policy.
The court held that the disclosure merely referenced the retention of outside counsel and did not objectively communicate a claim or potential claim to the insurer within the policy period.
The insurer had no duty to inquire further upon receiving the renewal application, as the obligation to provide notice rested on the insured.
The late notice deprived the insurer of opportunities to investigate, control the defence, and attempt early resolution, constituting actual prejudice.
Relief from forfeiture under s. 129 of the Insurance Act was unavailable because timely notice is a condition precedent to coverage under claims-made-and-reported policies.
