Insurance Law and the Civil Code of Québec Framework
Where the rules come from
Quebec insurance law sits in the Civil Code of Québec (Book Five) and in the Insuring Act, supplemented by the insurer's policy wording. The Code supplies default rules that apply unless the parties validly derogate; many protections for the insured are mandatory and cannot be contracted out of.
Key concepts
- Insurable interest: a person must have a relationship to the property or risk such that its loss harms them.
- Formation and disclosure: the insured must disclose all facts likely to influence the insurer's assessment of risk; misrepresentation may allow the insurer to rescind or reduce. The insurer's questions define the scope of the duty.
- Representations and warranties: a false declaration about a material fact can affect the claim.
- Obligations in case of loss: the insured must notify the insurer promptly and cooperate; the insurer must respond within the time limits set by law.
- Prescription: the limitation period for actions under an insurance contract is generally three years from the event giving rise to the right, subject to Code rules.
- Good faith: both parties owe each other good faith, and the insurer's duty to deal fairly is central to claims handling.
Traps in questions
Candidates confuse the duty of disclosure at underwriting with the duty to cooperate after a loss, or assume a policy clause can override a mandatory Code rule. Another common trap is miscounting limitation periods or assuming notification delay automatically voids coverage.
Worked example
An insured fails to mention a basement flood history when applying for property coverage; a later flood claim arises. The adjuster asks whether the omitted fact was one the insurer's questions targeted and whether it was likely to influence the risk assessment. If yes, the insurer may have grounds to rescind or reduce; if the question was never asked and the fact was not material, coverage stands. The adjuster documents the analysis rather than deciding on instinct.