April 1, 2013

Accident Benefits Update – One More Good Reason to Visit the US Virgin Islands: Auto Insurance!


For the week of  April 1 to April 5, 2013

One more good reason to visit the US Virgin Islands: Auto Insurance!

TD General Insurance Company v. Baughan, 2013 ONSC 333 (CanLII), March 8, 2013 (MacDonald J.)

MVC January 27, 2012. The insured suffered serious injuries as a passenger in a motor vehicle collision occurring in the United States Virgin Islands. An issue under Application was whether there was accident benefits coverage by virtue of the place of collision. The insurer denied coverage, arguing that the collision occurred outside the territorial limits set out in the Statutory Accident Benefits Schedule – Effective September 1, 2010 (“Schedule”).


Section 2(3) of the Schedule sets out the territorial limits for the Schedule’s application.  It reads as follows:

The benefits set out in this Regulation shall be provided in respect of accidents that occur in Canada or the United States of America, or on a vessel plying between ports of Canada or the United States of America.

Justice MacDonald found that the term “United States of America” is inherently complex and ambiguous. An average individual purchasing insurance has no guidance to understand whether he or she may be covered for an accident that occurs in the United States Virgin Islands, particularly given that the words “Virgin Islands” have the words “United States” before them.

Justice MacDonald concluded that an inclusive interpretation of “United States of America” for purposes of accident benefits would advance the remedial objective of insurance schemes, which is to ensure that accident victims have coverage. Justice MacDonald further held that any ambiguity in the term is to be interpreted in favour of the insured. As such, the insured is entitled to accident benefits for the injuries suffered in United States Virgin Islands.


Entitlement to accident benefits for injuries sustained in collisions outside of Canada is not limited to the 50 States of the United States of America. Accident benefits coverage may apply to collisions occurring in any of the following territories connected with the United States:

(a)   the 48 continental states;

(b)   the two non-continental states (i.e. Hawaii and Alaska);

(c)   the District of Columbia;

(d)   the three unincorporated organized territories (one of which is the United States Virgin Islands);

(e)   the ten unincorporated unorganized territories;

(f)   the extraterritorial jurisdiction of Guantanamo Bay.

As section 3(2) of the Statutory Accident Benefits Schedule – Accidents On or After November 1, 1996 is identical, the same principle applies to collisions that occur in those territories after November 1, 1996 but before September 1, 2010.

Accessing This Decision

If you would like to read the court’s decision for yourself, it can be found athttp://canlii.org/en/on/onsc/doc/2013/2013onsc333/2013onsc333.html



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