This blog post reviews why you may want to consider purchasing Alberta’s Family Protection Endorsement (SEF 44) in addition to your standard auto insurance policy coverage. We also review some limitations concerning “who” is covered and what is covered.

What does the Family Protection Endorsement Offer?

For a modest premium increase, you can add Family Protection Endorsement (SEF 44) when you purchase your automobile insurance policy. This additional coverage allows you to claim up to your third-party liability limits, (commonly $1 million or $2 million) in the event you are injured in an accident and:

• the at-fault driver is underinsured; that is, they have less liability coverage than your claim is worth
• the at-fault driver is uninsured, or
• you are injured by a hit and run driver, or the at-fault driver is otherwise unknown

What does the Family Protection Endorsement (SEF 44) cover?

This coverage is called family protection because, in addition to providing additional coverage for yourself, as the insured, it could also protect:

• your married spouse if they reside in the same home as you
• your common law spouse, if they reside in the same home as you and you have lived together for five years or more
• your common law spouse, if you have lived together in a relationship of some permanence within the preceding year of the claim, and you are the natural parents of a child
• a child or “dependent relative” under the age of 18 who resides with you and is principally dependent on you or your spouse for financial support
• a child or dependent relative who is over the age of 18 who, because of mental or physical infirmity, is principally dependent on you or your spouse for financial support
• a child or dependent relative who, because of full-time attendance at school, college or university, is principally dependent on you or your spouse for financial support
• a parent or relative of you or your spouse who resides with and is principally dependent for financial support on you or your spouse

One notable feature is that SEF 44 coverage follows the insureds, their spouses, and dependent relatives, and not their cars, so coverage may also be available if one of these groups of people is injured as a passenger in a vehicle or is struck by a vehicle while a pedestrian.

Limits on the Scope of Coverage

The scope of the family protection coverage is illustrated by the Alberta case of Hindley v. Dominion of Canada General Insurance Co., 2012 ABQB 728, additional reasons at 2013 ABQB 130. In this case, a daughter who was over 18 years old claimed for the SEF 44 family protection coverage on her mother’s policy. The daughter lived alternately with her divorced mother and father, at free room and board, to save money to attend full-time college in Lethbridge. From March 2006 until August 2006, the daughter resided with her mother and her husband. Then, in September 2006, she moved to Lethbridge to attend the Community College. She paid her own tuition, paid for her own living accommodations, and paid for her food, relying on student loans and money saved. She was then in a car accident on October 26, 2006.

Hall J. decided that to satisfy the statutory requirements, the daughter must be “chiefly” or “for the most part” reliant on her mother for financial support. Further evidence showed that the mother had contributed between $9000 and $9995 for her daughter’s support in the relevant period. On the other hand, the daughter had contributed earned income of $10,134 and a student loan of $5000 towards her own support. Hall J. concluded that she was therefore not principally financially dependent on her mother, and she could not claim on her mother’s SEF 44 family protection coverage.

Common Scenarios Where the Family Protection Endorsement May Apply

SEF 44 coverage comes into play most frequently with underinsured or uninsured at-fault drivers. This was the situation, for example, in Pulwicki v. Primmum Insurance Co., 2013 ABQB 744. In this case, the family’s teenage son was driving, and his father and mother were passengers. They were hit by an uninsured motorist, Rae. Tragically the mother was killed in the accident, and the son and father suffered injuries. Rae failed to defend the action, so the action was taken up with the Administrator of The Motor Vehicle Accident Claims Fund. The Fund paid out its maximum limit of $200,000 to compensate for the injuries of the son and father and the death of the mother. In addition, bereavement damages were paid to the children of the family pursuant to the Fatal Accidents Act. The remaining damages owing were satisfied out of the SEF 44 Family Protection Endorsement in the father’s car insurance policy.

The situation where the at-fault driver is unknown is illustrated by the recent Yukon case of Joe v. The Wawanesa Mutual Insurance Company, 2020 YKSC 38. Baker was driving a friend’s car, while Joe was a passenger. They were travelling along the Alaska Highway when a piece of metal called a porta anchor flew from a semi-truck and trailer going in the opposite direction. The porta anchor went through the driver’s window, instantly killing the driver Baker and injuring the passenger, Joe. The semi-truck and trailer was never identified. The court had to decide whether the SEF 44 policy of the owner of the car or the SEF 44 which the passenger Joe had on his own vehicle would provide coverage. In the result, it was held that Joe could rely on his own SEF 44 coverage “for which he has paid a premium.”

General Limits to Family Protection Endorsement Coverage

Notwithstanding the overwhelming benefits of purchasing SEF 44 Family Protection coverage, there are some limitations to the coverage, including:

• the SEF 44 coverage cannot be “stacked” on other insurance coverage – this means that if you and the at-fault driver have the same third-party liability policy limits, for example, $2 million, the SEF 44 coverage cannot be added on as an additional coverage source from which to draw compensation for your injuries (Suchan v. Casella (2006), 81 OR (3d) 73
• the car driven by the at-fault driver must be driven with the consent of the owner of the vehicle – if you are injured while a passenger in a stolen vehicle, you cannot call on SEF 44 coverage (Cardinal v. Alberta Motor Association Insurance Company, 2018 ABCA 69)
• the insurance company can place territorial limits on the insurance coverage such that, if you are injured in a car accident in the Philippines, for example, and the policy has territorial limits, you cannot claim SEF 44 coverage (Wage v. Canadian Direct Insurance Incorporated, 2020 ABCA 49)
• limitation periods apply to claims for SEF 44 coverage
• your injuries must result from the use or operation of a vehicle by the at-fault party

This last point is worth taking a closer look at, as it has been applied in what would seem to be irrational circumstances. In Funk v. Wawanesa Mutual Insurance Company, 2018 ABCA 200, the plaintiff was driving on his side of the road, at night, when an oncoming vehicle caused him to swerve off the road into a ditch, and his car rolled over. The plaintiff was seriously injured, and the Administrator of the Motor Accident Vehicle Claims Fund paid him the maximum payable amount of $200,000. He then claimed on his SEF 44 policy for additional coverage to compensate for his injuries. The insurer argued that his injuries were only compensable under the SEF 44 if his car had had physical contact with the oncoming vehicle, which it had not. They were successful in this argument on appeal, with leave to appeal to the Supreme Court of Canada denied. As the common saying goes, bad facts make bad law.

Every case will turn on its facts, and it is wise to get legal advice from an experienced personal injury lawyer to help you identify the different types of compensation that may be available to you.

CAM LLP Injury Lawyers

Since 1962, our lawyers have been achieving precedent-setting results for injured Albertans. Years of experience evaluating claims, negotiating settlements with insurance companies, and helping injured people get fair compensation makes a difference.

At CAM LLP, we have many years of experience representing passengers, drivers or pedestrians injured in road accidents. Our assessments include determining additional insurance coverage, like the SEF 44 Family Protection Endorsement, which could assist.

If you have been injured in a hit and run or in an accident with an under-insured or uninsured motorist, we can help you. Please contact us for a free consultation.