Fire Insurance and Wood Stoves

Posted on January 18th, 2012 by Centennial Law in Insurance

People living in the Cariboo have learned that not all insurance companies like wood stoves.  There are many examples of insurance companies telling homeowners to replace their wood stove with a “safer” method of heating – if they want fire insurance.  These homeowners may be interested to read about Hubert Thomas and his problems with Aviva Insurance.  [Aviva Insurance Company of Canada v. Thomas, 2011 NBCA 96 (CanLII)].


In 2000, Mr. Thomas insured his home with Aviva.  He correctly indicated on the insurance application that the primary heating source for his home was electrical.  The following year, Mr. Thomas added a wood stove to his home to supplement the electric heating system and reduce his heating costs.


In 2007, there was a fire at Mr. Thomas’ home.  Following the fire, the insurance adjuster noted the presence of the wood stove.  As a result, rather than pay Mr. Thomas’ claim, the insurance company sent him a notice cancelling his policy retroactively to the date of its last renewal.


Aviva tried to justify cancellation of Mr. Thomas’ policy by relying on Statutory Condition 4 which, by law, is considered to form part of an insurance policy.  In essence, this condition requires a homeowner to give notice to an insurance company when a change “material to the risk” is made in the home.  In other words, if you make a change which increases the danger of fire (or some other form of accidental loss), then you are required to tell the insurance company about the change.


So, you might ask:  how are you supposed to know that a change is, indeed, material to the risk?”  In the Thomas case, the Court decided that if an insurance company wants to cancel a policy on the grounds that there has been a change material to the risk, then it must give very clear notice to its customer about the kind of change it considers to be “material.”  In Mr. Thomas’ case, the Court decided that Aviva had done nothing before the fire to tell him that the installation of the wood stove was material to the risk.  On that basis, Aviva was required to pay Mr. Thomas for the repairs caused by the fire in his home.


Article written by Centennial Law Corp. (Douglas E. Dent)


The specific facts of any real life situation can have many unforeseen legal implications. As a result, please note that the general information found in the above article should not be treated as legal advice.