Executive Summary: Key Legal and Evidentiary Issues

• Whether Ms. McLaughlin’s answer “No” to Question C-11 on the life insurance application constituted a material misrepresentation about her weight.
• Significance of medical records showing her weight before and after March 10, 2017, as circumstantial proof that her weight was outside the policy’s accepted range on the application date.
• Interpretation of Question C-11 and its accompanying height–weight table, and whether any ambiguity should be construed against the insurer.
• Application of the statutory duty of utmost good faith and disclosure under the Insurance Act to an insured’s knowledge of her own height and weight.
• Determination of whether the misrepresentation was material such that a reasonable insurer would have declined the specific Simplified Elite product or offered different coverage.
• Allocation of costs following dismissal of the claim, including whether the insurer was entitled to void the policy and recover a fixed sum in costs.

Background and parties

The case concerns a dispute over life insurance proceeds following the death of Denise McLaughlin. In March 2017, Ms. McLaughlin applied for life insurance through a Canada Protection Plan form, with the insurer being Foresters Life Insurance Company. The product issued was a CPP Simplified Elite 20-year Term life insurance policy, number DH00107590, with a face amount of $100,000. Her spouse, André LeBreton, was designated as the sole beneficiary. After Ms. McLaughlin’s death on September 15, 2018, Mr. LeBreton sought payment of the policy as beneficiary and in his capacity associated with the Estate of Denise McLaughlin, leading to litigation when Foresters voided the policy and refused to pay the death benefit.

Insurance application and policy terms

The application form completed on March 10, 2017, was a multi-product Canada Protection Plan form containing six different insurance products arranged from A to F, with higher-level products offering more extensive coverage and lower premiums. Eligibility for each product depended on an eligibility questionnaire for the relevant section; applicants who answered “No” to all questions in a section were automatically approved for that product, but a single “Yes” answer disqualified them from that section and required consideration of a lower-tier product. Ms. McLaughlin answered “No” to all questions in sections A, B, C, and D, and did not complete sections E and F. As a result, she was approved for and issued the “Simplified Elite” policy corresponding to section D. A key question in Section C was Question C-11, which asked: “Is your weight outside the range shown for your height in the following table?” accompanied by a note that for females, 5 lbs or 3 kg should be deducted from the lower range for the given height, and a table listing acceptable weight ranges by height. For a female of Ms. McLaughlin’s height (approximately 162 cm), the relevant acceptable range in the table was 40–98 kg (adjusted at the lower end for females as indicated), and she answered “No,” indicating that her weight was within this range. The application included express contractual declarations that the statements and answers provided were “true and complete” and that the insurer could void the policy in the event of “any misrepresentation” in the application or other answers related to it. The policy itself contained a Misrepresentation & Contestability clause allowing Foresters to “contest the validity of the contract, treat it as void and refuse to pay a benefit” if an application statement misrepresents or fails to disclose a fact material to the insurance, with contestability generally limited to two years during the insured’s lifetime, except in cases of fraud.

Claim, investigation, and insurer’s decision

After Ms. McLaughlin’s death in September 2018, Foresters treated the claim as contestable because the death occurred within two years of the policy date. As part of its contestability investigation, the insurer obtained and reviewed the medical records maintained by Ms. McLaughlin’s family physician, Dr. Jean LeBlanc. Those records contained weight measurements of approximately 103.1 kg on December 19, 2013, 117.9 kg on July 6, 2016, and 119.2 kg on June 26, 2017—each clearly above the 98 kg upper limit in the Question C-11 table for her height. The records also noted advice regarding diet and exercise. The investigation process involved a third-party administrator that checked the application for completeness and requested medical records, followed by an underwriting opinion from Canada Protection Plan as to whether any misrepresentation was material, and then review and approval by the reinsurer, PartnerRe, under the reinsurance treaty. On August 20, 2019, Foresters informed Mr. LeBreton in writing that it had voided the policy because Ms. McLaughlin’s weight had been outside the permitted range during the relevant period and that this information should have been disclosed at the time of application. The insurer took the position that, with accurate information about her weight, it would not have issued the Simplified Elite policy as requested. Foresters refunded the premiums paid, totaling $633.42, and denied the death benefit.

Evidence on weight and medical history

The parties admitted a number of key facts: Ms. McLaughlin was about 162 cm tall; she gained weight between 2013 and March 10, 2017; and at medical visits in 2013, 2016, and June 2017 her weight had consistently been well above 98 kg. Her spouse, Mr. LeBreton, testified that her weight “varied all the time,” that she sometimes gained and sometimes lost weight, and that she followed diets, but he did not provide evidence that her weight ever dropped into the 40–98 kg range around the time of the application. The insurer called two key witnesses: Eli Wahby, a senior claims consultant, and Doug Parrott, Chief Underwriting Officer at Foresters Financial. Mr. Wahby described the contestability process and, when asked to consider prediabetes indications discovered after policy issuance, initially indicated that the policy could be paid if there had been no prior history, but he ultimately clarified that with respect to the height–weight question, Ms. McLaughlin should have answered “Yes” to Question C-11. Mr. Parrott explained that underwriting evaluates insurability based on the application and supplementary data, that each question is designed to control risk for a particular product, and that height/weight ratio is “very important” in determining eligibility for the Simplified Elite product. An underwriting review conducted for the reinsurer, PartnerRe, based on a height of 162 cm and a weight of 117.9 kg concluded that Ms. McLaughlin should have been placed in the lower-tier Deferred Elite plan under section C, rather than qualifying for the section D Simplified Elite policy that was issued, and that she therefore should have answered “Yes” to Question C-11.

Legal framework: duty of disclosure and material misrepresentation

The Court examined the statutory duty of disclosure under the New Brunswick Insurance Act, particularly sections 144 and 145. These provisions require an applicant and the life insured to disclose, in the application and any written evidence of insurability, every fact within their knowledge that is material to the insurance, and provide that a failure to disclose or a misrepresentation of such a fact renders the contract voidable by the insurer, subject to the two-year contestability limitation where there is no fraud. Drawing on Canadian insurance law authorities, the Court reiterated that insurance contracts are contracts of utmost good faith because of the mutual vulnerability of the insured and insurer; the insurer relies on the applicant’s information to assess risk, and the insured relies on the insurer to respond fairly to claims. A material fact is one that, if truthfully disclosed, would have led a reasonable insurer to decline the risk or charge a higher premium. The Court emphasized that even innocent or inadvertent misstatements or omissions can justify voiding a policy where they concern material facts known to the insured but unknown and inaccessible to the insurer. In this context, Ms. McLaughlin’s height and weight were facts uniquely within her knowledge but inaccessible to Foresters at the underwriting stage, and they directly determined eligibility for the particular simplified underwritten product she received. The Court rejected the plaintiffs’ contention that Foresters ought to have verified her weight or obtained medical records before issuing the policy, noting that the underwriting model for simplified products justifiably relies on truthful answers to structured questions and that requiring full medical verification for every negative answer would make the process unworkable.

Factual inference on weight at the application date

A central evidentiary issue was whether Ms. McLaughlin’s actual weight on March 10, 2017, the day she completed the application, could be established on a balance of probabilities, given that there was no scale reading for that specific date. The plaintiffs argued that any finding that her weight exceeded the 98 kg maximum on that day would be speculative. The Court, citing principles that factual findings must rest on an evidentiary foundation rather than conjecture, accepted that the exact figure was unknown but held that it was proper to draw inferences from surrounding evidence. The medical records showed her weight as 103.1 kg in December 2013, 117.9 kg in July 2016, and 119.2 kg in June 2017. These data points, together with the admitted fact that she gained weight between the start of her relationship with Mr. LeBreton in 2013 and March 2017, allowed the Court to conclude that her weight remained outside the 40–98 kg range on March 10, 2017. On that basis, her answer “No” to Question C-11 was false, and she should have answered “Yes,” thereby disqualifying her from the Simplified Elite product in section D and leading, at best, to different, less favorable coverage under section C.

Alleged ambiguity of Question C-11

The plaintiffs further argued that Question C-11 and its accompanying table were ambiguous and confusing because they effectively asked two things at once (height and weight) and required a mathematical calculation to determine whether the applicant’s weight was inside or outside the indicated range. They relied on authorities stating that ambiguous questions in insurance applications should be construed against the insurer that drafted them and that the proper test is what a reasonable applicant would understand upon a straightforward reading, without parsing grammar or syntax. The Court acknowledged those interpretive principles but found they did not assist the plaintiffs here. It held that Question C-11, read in its plain, ordinary, and natural sense, is straightforward: the applicant looks up their height in the table and assesses whether their weight falls within or outside the listed range. The note for females simply instructs that the lower limit be adjusted downward by 5 lbs or 3 kg. The Court did not regard this as a complicated or ambiguous exercise. The momentary confusion displayed by witnesses during questioning—such as Mr. Parrott initially giving a broad weight range and then correcting himself, and Mr. Wahby initially misspeaking about whether the answer should have been “No” or “Yes”—was not taken as evidence of genuine ambiguity in the question itself. Instead, the Court concluded that a reasonable person could readily determine, based on their own height and weight, whether they were outside the specified range.

Outcome and costs

Having found that Ms. McLaughlin’s answer to Question C-11 was false and that the true height/weight ratio was material to eligibility for the Simplified Elite policy, the Court held that Foresters was entitled under both the Insurance Act and the policy’s Misrepresentation & Contestability clause to void the contract. The policy was still within the contestability period at the time of death, and the misrepresentation related to a fact known to the insured, unknown to the insurer, and objectively material to the risk. The Court rejected the plaintiffs’ submission that the insurer was obliged to make further inquiries before issuing simplified coverage and dismissed their claims that the question was ambiguous. In the result, the Notice of Action and Statement of Claim seeking payment of the $100,000 death benefit under policy DH00107590 were dismissed. Considering the joint Book of Exhibits and the overall outcome, the Court awarded fixed costs in favor of the defendant. The successful party in this litigation was Foresters Life Insurance Company, and the Court ordered the plaintiffs to pay costs of $2,000 to the defendant; no damages or policy proceeds were awarded to the plaintiffs, so the total monetary award ordered in favor of the successful party amounted to $2,000.