Published In: Insurance Law Newsletter – 15.Sep.20 September 15, 2020

Case Summary: Broker not liable for underinsuring insured’s property

Insurance law – Property insurance – Agents and Brokers – Duties and liabilities of agent – Breach of contract – Failure to obtain reasonable coverage – Practice – Leave to appeal

2049390 Ontario Inc. v. Leung, [2020] O.J. No. 935, 2020 ONCA 164, Ontario Court of Appeal, March 3, 2020, D.H. Doherty, D.M. Brown and J.A. Thorburn JJ.A.

The insured appealed a decision dismissing its claim against its broker in respect of the insurer’s refusal to cover the cost of rebuilding the insured’s property after it was destroyed by fire. The insurer opted to pay out the value of the building limit under the policy.

The insured brought a claim against its broker alleging they had failed to secure adequate reconstruction cost insurance.  The claim was brought in negligence and in contract.

On appeal the insured alleged the trial judge had erred by: (1) refusing to enforce the broker’s promise to provide adequate coverage; (2) excusing the broker for having given an estimate of building costs they were unqualified to give; and (3) relieving the broker of admissions they did not qualify their advice.

The Court of Appeal found the broker had met their obligations in contract and tort and the appeal was dismissed.

This case was digested by Cameron B. Elder, and first published in the LexisNexis® Harper Grey Insurance Law Netletter and the Harper Grey Insurance Law Newsletter. If you would like to discuss this case further, please contact Cameron B. Elder at