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SEF 44 Family Protection Endorsement

October 16, 2023

The SEF 44 Family Protection Endorsement is an optional coverage you can choose to add to your motor vehicle insurance in New Brunswick. This endorsement provides additional coverage if another driver injures you or a family member and that driver does not have enough insurance to pay for the injury claim. If you are injured in a motor vehicle accident, this endorsement will cover the difference between the at-fault driver’s policy limit and your policy limit. 

Understanding the Importance of SEF 44 Family Protection Insurance

If you are involved in a motor vehicle accident, and someone else is at fault for the accident, you are entitled to compensation for your injuries. This can include compensation for: Out-of-pocket expenses, general damages for pain and suffering, the replacement cost of chores you can no longer do, loss of income, and future care costs. Depending on the severity of the injuries, the amount for a claim of damages can be high.

The insurance company for the at-fault driver is only required to pay an amount for compensation up to the policy limit. The mandatory minimum policy limit in New Brunswick for third-party claims is $200,000. Some vehicles may be insured with policy limits above the mandatory minimum. For example, policy limits of $500,000, $1 million, or $2 million dollars. 

Even if your motor vehicle insurance policy has higher policy limits, this does not protect you if you are injured in a motor vehicle accident and the other party has lower policy limits. The SEF 44 family protection endorsement can protect you and your family by providing additional coverage where the at-fault driver’s policy limits are lower.

What Does SEF 44 Family Protection Insurance Cover?

In order to be eligible for SEF 44 Family Protection Insurance, an insured individual must be injured due to a motor vehicle accident. Someone else must also be at fault or liable for the accident. The insurance policy for the at-fault driver must have lower policy limits than the SEF 44 policy limits. The SEF 44 coverage is residual, which means that the SEF 44 policy limits are not added to the at-fault driver’s policy limits. The SEF 44 policy covers the difference between the SEF 44 policy limits and the Section A policy limits. For example, say Mary was driving her vehicle when another vehicle ran a red light and collided with her vehicle. The vehicle has Section A insurance with policy limits of $200,000. Mary has SEF 44 coverage with a policy limit of $1 million dollars. Mary’s damages are assessed at $800,000. The driver’s insurer pays $200,000, and Mary’s insurer pays $600,000.

In addition, SEF 44 policies may provide coverage when the insureds are travelling in a vehicle outside New Brunswick. The coverage only applies to accidents involving another motor vehicle, and the other driver must be identified. The exception to this is accidents that happen in Quebec. For example, Sue and Bob have SEF 44 insurance coverage, with a policy limit of $1 million dollars, on their vehicle at home. Sue and Bob travel to Florida and rent a vehicle. While travelling in the rental vehicle, they are rear-ended while stopped at a traffic light. In Florida, mandatory policy limits are even lower, and the at-fault driver only has coverage in the amount of $20,000. Sue and Bob are severely injured, and their combined claims total is $1 million dollars. The Florida insurer pays $20,000, and Sue and Bob’s SEF 44 insurer pays $980,000.

Exploring the Scope and Limitations of SEF 44 Coverage

The policy limit for SEF 44 coverage is residual, not cumulative. Therefore, if you are in an accident and the at-fault driver’s insurance policy has the same policy limits as the SEF 44 policy, there is no additional benefit to the SEF 44 policy. For example, John has SEF 44 coverage in the amount of $500,000. John is driving his vehicle when another vehicle runs a stop sign and collides with John’s vehicle. The at-fault driver has an insurance policy with policy limits of $500,000. John’s claim is assessed at $750,000.  The at-fault driver’s insurer pays $500,000. John’s SEF 44 insurer will not pay anything.

There are also special limitation periods for bringing an SEF 44 claim against your insurer. The limitation period is contractual and can be found in the wording of the SEF 44 policy. The limitation period requires that the action or proceeding be commenced within one year from the date the claimant or legal representative knew or ought to have known that the claim amount exceeded the minimum statutory limits for motor vehicle liability. Therefore, it is essential that if you plan to pursue an SEF 44 claim, the appropriate claim documents be filed within the limitation period.

Maximizing the Benefits of SEF 44 Family Protection Insurance

The SEF 44 Family Protection Endorsement is optional, and therefore, it is not necessarily included with every motor vehicle policy in New Brunswick. The fee for this endorsement is usually not large. If you have motor vehicle insurance in New Brunswick, it is important to check whether you have the SEF 44 endorsement as part of your coverage. If your policy does not include the SEF 44 endorsement, you may want to consider including this endorsement as part of your insurance coverage. 

Jessica Melanson <i class="fab fa-linkedin"></i>
Jessica Melanson

Jessica Melanson, an experienced personal injury lawyer and University of New Brunswick graduate, leads Melanson Law, a family-owned firm focused on injury law. Melanson Law is committed to getting our clients the best possible results. We use trauma-informed approaches with clients as we guide them through the injury law process. We provide our clients with the information and support they need to understand their claim and the system as we work diligently to resolve their claim.

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