Motorcycle Found to Be “Newly Acquired Automobile”

In Johnson v. Jevco, 2021 ONSC 4870, a statutory accident benefits claimant had an automobile insurance policy with Jevco for a Chevrolet Silverado. He bought a motorcycle and contacted his broker to request a quote to insure the motorcycle. He was advised that Jevco does not underwrite motorcycle insurance and that, given his poor driving record, he would need to seek insurance through the insurer of last resort, the Facility Association.

The claimant did not end up obtaining insurance elsewhere and was involved in an accident while operating the motorcycle 11 days after he purchased it. He sought accident benefits from Jevco. Some benefits were denied on the basis that the claimant was operating the motorcycle without insurance.

The Licence Appeal Tribunal determined that the claimant was covered under the Jevco policy. This was upheld on reconsideration.

Jevco appealed to the Divisional Court. The issue was whether the motorcycle was a “newly acquired automobile” under s. 2.2.1 of the Ontario Automobile Policy.

The Divisional Court found in favour of the claimant, stating:

…a motor vehicle which, pursuant to the Highway Traffic Act includes a motorcycle is, for the purposes of the Insurance Act, an automobile because under the Compulsory Automobile Insurance Act it is required to be insured. On this basis a motorcycle is recognized as an automobile when that term is used in the Ontario Automobile Policy (OAP 1) Owner’s Policy. This being so, when the Ontario Automobile Policy s, 2.2.1 refers to a “newly acquired automobile” it includes a newly acquired motorcycle. As found in the Decision of the Licence Appeal Tribunal and confirmed in the Reconsideration Decision this means that Jacob Johnson was insured on the day of the accident and, given the agreement of the parties qualifies for the benefits that were denied.

The Divisional Court stated that the fact Jevco does not insure motorcycles as a matter company policy is irrelevant because “…Jevco cannot, in the face of its contractual obligations imposed by provincial policy, or otherwise agreed to by Jevco, avoid those obligations by relying on an internal company policy to the contrary”.

Therefore, Jevco’s appeal was dismissed.