Automobile liability insurers in Alberta have long been permitted to offer advanced payments to injured claimants in part settlement of claims without admitting that the insurer or its insured has any liability. This bulletin looks at two issues surrounding advanced payments: the disclosure of advanced payments to the trial judge and the recent amendment allowing non-voluntary court-ordered advanced payments.
The current advanced payment provision is section 581 of the Alberta Insurance Act, which provides:
581(1) When an insurer
makes a payment on behalf of an insured under a contract evidenced
by a motor vehicle liability policy to a person who is or alleges
to be entitled to recover from the insured covered by the policy,
the payment constitutes, to the extent of the payment, a release by
the person or the person's personal representative of any claim
that the person or the person's personal representative or any
person claiming through or under the person or by virtue of the
Fatal Accidents Act may have against the insured and the
insurer.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
