Car insurance denied for misrepresentation: how to fight it

You are in a collision, you make a claim, and your auto insurer answers by treating the whole policy as void over something you said, or did not say, on your application. It is a harsh position for an insurer to take, and it fails more often than people assume, because the insurer carries the burden of proving every element of the allegation.

Under section 233 of Ontario's Insurance Act, a claim is invalid where the applicant gave false particulars of the described vehicle to the insurer's prejudice, or knowingly misrepresented or failed to disclose a fact the application required. In practice, the allegations usually look like this:

• An undisclosed driver in the household, often a spouse, a newly licensed teenager, or an adult child who regularly uses the car.
• A wrong address, so the car is rated for a cheaper territory than where it actually lives.
• Undisclosed prior claims, cancellations, or driving convictions.
• Personal use declared while the vehicle actually works for a delivery or rideshare service.
• Statements made after the accident the insurer says are untrue, most commonly about who was driving.

A voided policy is rarely the adjuster's snap decision. Files like these usually go to the insurer's special investigation unit, which pulls the application and broker file, checks industry claims databases, and interviews people in the household. You may notice the tone of the file change before any denial arrives: repair approvals stall, and the questions get more pointed.

The formal step is an examination under oath. Ontario's statutory conditions for auto insurance, set out in O. Reg. 777/93, require an insured who makes a claim to submit to examination under oath if the insurer asks. It is a recorded, transcribed interview where the insurer's lawyer asks you questions and your answers become evidence. Refusing to attend can itself put you in breach of the policy, so an outright no is usually the wrong move. But you are entitled to have your own lawyer present, and you should. The examination is limited to matters relevant to the claim, it is not a licence for the insurer to fish through your life, and a lawyer in the room keeps it that way.

The insurer must prove knowledge and materiality

For an application-based denial, the misstatement generally must have been made knowingly. An honest mistake is not deliberate concealment. Neither is a question your broker never actually asked you, or an ambiguous form answered in good faith. The insurer also has to show the fact mattered, meaning it would have changed the premium or the decision to insure you at all.

What happened through the broker matters

Many applications are completed over the phone by a broker or agent who ticks the boxes. If you answered accurately and the form was recorded wrongly, or a renewal rolled over old answers no one asked you to confirm, the case against you weakens considerably. Broker files, call recordings, and the application history are all producible in litigation.

A voided policy does not erase every obligation

Even where a breach is made out, Ontario law protects innocent third parties. The insurer generally stays on the hook to people you injured, up to the statutory minimum limit of $200,000, and then looks to you for reimbursement. Statutory accident benefits are separate again. Medical, rehabilitation, and attendant care coverage, plus income replacement if your policy still includes it (income replacement became optional coverage on policies issued or renewed on or after July 1, 2026), all run under their own regime, and disputes go to the Licence Appeal Tribunal rather than the courts. A denial letter aimed at one entitlement does not automatically kill the others.

The immediate practical problem is your own vehicle. If you were not at fault, your repairs would normally run through direct compensation property damage, but DCPD is a claim under your own policy, so an insurer that treats the policy as void will not pay it, and collision coverage falls with it. While the dispute runs, you are paying for repairs or a replacement vehicle out of pocket. Keep every receipt and estimate. If the denial fails, those amounts form part of what the insurer owes you.

The other driver's claim usually keeps moving on a separate track. The insurer may continue handling it under a non-waiver agreement or reservation of rights while it investigates your coverage, which is exactly why you should read anything the adjuster asks you to sign before signing it. And as noted above, even a sustained denial leaves injured third parties protected to the statutory minimum, with the insurer looking to you to be repaid. That reimbursement exposure is itself a reason to contest a denial rather than let it stand unchallenged.

1. 01Do not give a further statement to the adjuster or the insurer's investigator before getting legal advice. Post-denial statements are frequently the strongest evidence used against policyholders.
2. 02Gather your application history: the original application, every renewal, and any correspondence with your broker. Ask the broker in writing for their complete file.
3. 03Write down your account of what you were asked and what you answered, while it is fresh.
4. 04Respond through counsel and pin the insurer down: which statement, made where and when, and what evidence shows it was knowingly false and material.
5. 05Move quickly. A court action generally has to be started within two years of the denial, and an application to the Licence Appeal Tribunal over denied accident benefits generally has its own two-year deadline from the denial of the benefit.

Walking away from a void ab initio position has costs that outlast the claim. The voided policy sits on your record as an insurer-initiated cancellation, and every future application will ask about it. You have to answer truthfully, since a false answer there hands the next insurer its own misrepresentation case. Regular-market insurers routinely decline applicants with a policy voided for misrepresentation. What remains is the high-risk market, ultimately Facility Association, the industry pool that acts as Ontario's insurer of last resort. Nobody is refused coverage there, but premiums run far above the regular market, and that surcharge can follow you for years. On top of that sits any reimbursement the insurer claims for amounts it paid the other driver.

Fighting it means making the insurer prove knowledge and materiality on a real evidentiary record: the broker's file, the call recordings, the application history. Denials that looked confident in a letter often soften once counsel demands that proof, and a denial that is withdrawn or settled does not carry the same record. The fight takes time and it is not free, but for most drivers the comparison is not between fighting and doing nothing. It is between fighting and paying inflated premiums, out of pocket repairs, and a reimbursement claim for years afterward.

Most misrepresentation denials are never tested, because the policyholder reads the letter, assumes the insurer must be right, and walks away. If the allegation does not match what you actually told your broker, do not be one of them. Make the insurer prove it.

• Ontario courts
• Evidence & documents
• Step-by-step guide

This article is general information, not legal advice, and does not create a solicitor-client relationship. It is current as at its publication date and is not revised as the law changes. For advice on your specific situation, book a consultation or call 416-639-0887.

Written by

Caleesis Telesh

Founder & Principal Lawyer

LL.B. · B.A., York University · Member, Law Society of Ontario

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