Amendments to the Alberta Standard Policy Forms Aim at Modernizing Coverage and Language

Written By: G. (Guy) Valle, Articling Student

I.                     Introduction

The Alberta Government has introduced changes to the Standard Policy Forms for automobile insurance, including the Standard Owner’s Automobile Insurance Policy (SPF-1), effective May 1, 2021.  Although most changes will not affect coverage under the SPF-1, this article summarizes what the new changes may mean for insurers and insureds:

II.                  Summary

The new policy incorporates language to align with the recent amendments to the Accident Benefits Regulation, which came into force on November 1, 2020.  The policy also removes outdated language including “rugs and robes”, electronic equipment, the term station wagon, and confirms that some personal items such as cell phones and computers fall outside of coverage under the SPF-1.

In addition, the new SPF-1 codifies changes to Comprehensive coverage that the insurance industry was already applying.  The Statutory Conditions add “recorded mail” instead of “registered mail”, and the policy contains gender-neutral language.

We do not intend to summarize every change, but the following are some of the revisions we find to be more important and interesting.

III.                Highlighted Changes
1. SPF-1 Section A

The language in the policy is now gender-neutral and updates the outdated reference to Workmen’s Compensation with Workers’ Compensation.  Under Section A – Third Party Liability, the reference to “his consent” is replaced with “the insured’s consent.”

2. SPF-1 Section B

The new wordings reference section 320.14 of the Criminal Code under “Special Provisions, Definitions, and Exclusions of Section B”.  The previous wordings read:

(b) The Insurer shall not be liable under Part II of Subsection 2 of this Section B for Bodily injury

(i) sustained by any person who is convicted of an offence under section 253(b) of The Criminal Code (driving with more than 80 milligrams of alcohol in 100 milliliters of blood) or under section 253(a) of The Criminal Code (driving while the ability to drive impaired by alcohol or a drug) occurring at the time of the accident, or

The new language is straightforward, and reflects updates to the Criminal Code:

(i) sustained by any person who is convicted of an offence under section 320.14 of the Criminal Code (Canada) occurring at the time of the accident… .

3. SPF-1 Section C

Under Section C, Subsection 3 – Comprehensive, “another object” has widely been interpreted to include animals including wildlife despite the fact that the policy did not specifically refer to animals.  In any event, insurers have widely interpreted “another object” to include animals.

The old wording read:

From any peril other than by collision with another object or by upset.

“The words “another object” as used in this subsection 3 shall be deemed to include (a) a vehicle to which the automobile is attached and (b) the surface of the ground and any object therein or thereon…”

The new wording reads:

From any peril other than by collision with another object or by upset.

“The words “another object” as used in this subsection 3 include (a) a vehicle to which the automobile is attached and (b) the surface of the ground and any object therein or thereon excluding a live undomesticated animal…

Comprehensive coverage is meant to cover all accidental damage to the insured automobile, other than a collision with another object, and now with the exception of a collision with a live undomesticated animal.  Therefore, a collision with a live undomesticated animal would fall within the confines of the comprehensive coverage.

While striking an animal is technically a collision with another object, insurers have treated collision with animals, as a comprehensive loss likely to avoid arguments and lawsuits to determine whether the animal jumped at the vehicle, hence, “falling object”, or was hit while on the ground.

Essentially, this new wording creates an exclusion within the exclusion that was contained in the former comprehensive coverage subsection.  The new wording would provide coverage for damage caused by “live undomesticated animals” so the next time you park your car at Jasper National Park you should feel safe in the understanding that you will have coverage should an Elk take a disliking to your particular vehicle.

Hit and Run Collisions 

Hit and run collisions were widely seen as falling under Comprehensive Coverage if the insured vehicle was not in use or operation through the development of case law.  This is now codified in the new wordings, by including coverage for:

“Loss or damage caused by an object, including another automobile, striking the automobile when the automobile is not in use or operation…”.

Other Minor Changes

Section C now removes “rugs and robes” under Exclusions (1)(e) and providing a more extensive list of electronic accessories that are excluded from coverage provided that “such electronic accessories and electronic equipment are detached from the automobile.”

Therefore, if someone leaves some of the listed equipment i.e., a radio, television, facsimile machine, etc., attached to the vehicle, it might arguably be covered.  The new criteria of being “attached” to the vehicle might be an attempt to clarify “vehicle and its equipment”.  Put another way, electronic equipment that is being used as part of the insured vehicle attract coverage, whereas electronic equipment that happens to be in the vehicle is not.

The definition of “Automobile” at long last removes “Station Wagon Type”, reflecting the changes in modern consumer choices. Notably, there is no change to the Court’s interpretation of “type” referring simply to the “type” of vehicle, as opposed to the “use” of that vehicle. Note that this change applies only to Section A (Third Party Liability) and Section B (Accident Benefits).

Under Statutory Conditions, the language of 8(a) (Termination) has been revised to permit notice of termination to be sent by “recorded mail” as opposed to just “registered mail”.  “Recorded mail,” as defined in the Alberta Rules of Court, Alta. Reg. 124/2010 “means as a form of document delivery by mail or courier in which receipt of the document must be acknowledged in writing as specified in Part 11.” This is likely intended to account for the reduced use of registered mail through Canada Post and the corresponding increase in the use of various courier services. At the very least it is permissive of using a courier service other than registered mail through Canada Post.


Disclaimer: This article is to be used for educational and non-commercial purposes only. Parlee McLaws LLP does not intend for this article to be a source of legal advice. Please seek the advice of a lawyer before choosing to act on any of the information contained in this article.