What Information Is An Insurance Company Allowed to Require From a Person Making a Claim For Coverage?
The Law Requires An Insured Person to Co-operate With An Investigation By An Insurance Company; However, An Insurance Company Is Forbidden From Making Unreasonable Requests or Engaging In Mere Explorations Without Reasonable Grounds.
Understanding When Insurance Claim Investigations Become Improperly Intrusive and Thereby Unreasonable
Prior to paying out monies arising from claims submitted to an insurance company, the insurance company may conduct an investigation into the nature of the incident that caused, or resulted in, the claim as well as investigating the truth and accuracy of the information as was previously submitted to the insurance company.
An insurance company has the right to investigate the accuracy of information relating to an insurance claim as well as the underwriting information previously provided to the insurance company. Ensuring against fraud or material misrepresentation helps to prevent abuses that would otherwise affect the costs of insurance that would affect all insurance consumers. However, when performing investigations, an insurance company must keep inquiries for additional information within reasonable boundaries. The right to perform investigations, including the right to interview a claimant and require additional documents from a claimant arises from the common law as well as the statutory law. The right of an insurer to require such co-operation and the duty of an insured to provide such co-operation was well explained within the case of Aviva Insurance Company of Canada v. Ebhodaghe, 2021 ONSC 7343, which involved an automobile insurance claim, wherein it was said:
 The policy in this case is governed by the Insurance Act. Section 234(1) of the Act provides that statutory conditions set out by regulation are deemed to be part of every insurance contract. The applicable terms and conditions are set out in the Ontario Automobile Policy known as OAP1. Section 8 of the OAP1 lists certain statutory conditions found in Statutory Conditions – Automobile Insurance, O. Reg. 777/93. Condition 6(4) of these Statutory Conditions provides as follows:
Examination of insured
(4) The insured shall submit to examination under oath, and shall produce for examination at such reasonable place and time as is designated by the insurer or its representative all documents in the insured’s possession or control that relate to the matters in question, and the insured shall permit extracts and copies thereof to be made.
 The purpose of the section is to provide an insurer with an opportunity to obtain knowledge of facts necessary to enable it to decide upon its obligations and to protect it from false claims: see Baig v. The Guarantee Company of North America, 2007 ONCA 847 at para. 25.
 There is no issue that a court can grant an order compelling an insured to participate in an examination under oath at the request of their insurer, see Lauzon v. AXA Insurance (Canada), 2013 ONCA 664 at paras. 12-13.
With the above said per the Aviva case, among other cases, the right to investigate provided to an insurer and the duty to co-operate imposed upon an insured is restricted to questions and documentary demands that are objectively reasonable and for which an insurer has reasonable grounds for suspicion of fraud or material misrepresentation. An insurer is precluded from abusing the investigative rights to make excessively intrusive demands for information. The requirement that investigations be kept "objective and reasonable" was clearly explained in Aviva wherein it was stated:
 In view of Aviva’s conduct in questioning Ms. Ebhodaghe about the location of her residence and its demand for broad access to Ms. Ebhodaghe’s cell tower data and banking records, I wish to address a clear issue that arises in relation to the scope of the examination as well as the scope of documentary production requested.
 I note that the scope of permissible questioning is not open ended but rather restricted to “questions that are material to the insurer's liability and the extent thereof”: see Baig, supra, at para. 25. As Juriansz J.A. explains in Baig at paras. 26-27:
The purpose of the statutory examination is to provide GCNA with the opportunity to examine the insured in regard to the matters that might properly affect its decision whether or not to pay the claim.
I recognize the force of counsel for Baig's submission that taking a broad view of the scope of the statutory examination could provide insurers with the opportunity to conduct baseless reviews of the underwriting of the insurance contract in an effort to find a basis to refuse claims. Undoubtedly, the statutory examination is not intended to permit insurers to embark on fishing expeditions or to take blind shots in the dark. However, where the insurer has an objective and reasonable basis for suspecting fraud in the initial appraisal, questions about the matter are relevant.
 It is clear that in making an order compelling a person to attend for examination under oath, a court can also assess the relevance of the proposed areas of questioning. In doing so, the court has the jurisdiction to compel a person to attend and answer only relevant questions and produce only relevant documents.
 Applying that standard to this case, I start by observing that the implicit position in the material filed is that Ms. Ebhodaghe lied about her home address when she applied for insurance. However, I note that Aviva has placed nothing before the court supporting a possible inference or finding that Ms. Ebhodaghe did, in fact, lie in her insurance application. I appreciate that Mr. Raguseo either believes or at least suspects that she did, but the basis for his belief or suspicion is not set out in the materials. While the transcript of the discussion with Ms. Ebhodaghe raises some issues, I am not prepared to find that it, standing alone, provides a reasonable and objective basis to suspect that Ms. Ebhodaghe lied or committed fraud. Furthermore, while I understand from general knowledge that insurance companies calibrate rates according to geographical locations, I have no evidence before me explaining why this is an issue on the facts of this case and why it may result in Aviva declining coverage and/or cancelling the policy. In other words, I have no basis for assessing why, assuming she did lie about her residence location, it is material to the decisions that Aviva must make in assessing the claim. As such, it is not possible on this record to conclude that Aviva has an “objective and reasonable” basis for suspecting fraud in the initial application by Ms. Ebhodaghe.
 Should this motion return before me, Aviva would be wise to consider the evidentiary basis upon which it seeks an order compelling Ms. Ebhodaghe to submit to an examination about the veracity of her claimed residential address. Again, I note that Baig clearly states that a statutory examination is not a fishing expedition.
 In terms of the request for an order compelling documentary production, I am not remotely satisfied that the scope of permissible examination would include production of cell tower data and banking data that includes the specific locations where Ms. Ebhodaghe spent her money over many months.
 To be blunt, these requests are abusive and unnecessarily invasive of Ms. Ebhodaghe’s privacy rights. Condition 6(4) of the Statutory Conditions authorizes an insurer to obtain information relevant to assessing its contractual obligations. It does not authorize a broad, unfettered sweep through the intimate details of a person’s movements and spending habits over many months.
Insurers have the right to investigate claims and to require that an insured attend an interview and answer questions about the incident giving rise to the claim as well as details relating to the coverage when the insurer has reasonable grounds to suspect fraud or misrepresentation. Insurers must conduct objectively reasonable investigations without engaging in baseless explorations.