Avoiding Home Insurance Nightmares

Just after midnight on January 18th, 1994 Daphne Whiten, her husband and their daughter, dressed only in their night clothes, fled into the night and watched in horror as their house and worldly possessions, including three cats, were lost to a fire. It was minus 18 degrees Celsius.

As you would expect, the Whitens contacted their insurance company, Pilot Insurance. Rather than simply paying the claim, Pilot Insurance decided to play hardball with their client and refused to pay the full sum of their claim. Pilot insurance knew their client was suffering financial hardship at the time. This was going to be a David and Goliath struggle.

In order to justify their refusal to pay the full amount of the claim, Pilot alleged that the Whitens had torched their house. Pilot did this even though their own expert had confirmed this was NOT a case of arson, a fact Pilot Insurance ultimately acknowledged.

At trial the jury awarded the Whitens $318,252.32 in compensatory damages and ONE MILLION DOLLARS in punitive damages for the bad faith in which Pilot Insurance handled this legitimate claim. In addition, the Whitens were awarded $317,658.92 for their court costs. At the time of the fire, the fair market value of the house was said to be $157,000.00.

The decision was upheld by the Supreme Court of Canada in 2002.

Lesson to be learned?

1. In another case, this one involving The Ross Firm, one of our clients retained us in a Divorce case involving a family farm and other assets. Our client's position at the outset was that they would be happy to settle for $200,000.00.

We saw it differently. The final award granted to our client was 1.2 million dollars. Getting the right law firm is important.

If you are involved in a legal issue:

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