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FSCO Releases Decision Clarifying What Is a "Medical Reason" for Denial of a Benefit and Insurer's Examination

The Financial Services Commission of Ontario (FSCO) has released a decision clarifying what is considered to be a "medical reason" for an insurer to deny a benefit and for the insurer to demand that an insured attend an insurer's examination under Section 44 of the Statutory Accident Benefits Schedule (SABS). In the decision, Kadian Augustin and Unifund Assurance Company [FSCO A12-000452] Arbitrator Susan Sapin considers whether or not Ms. Augustin is allowed to dispute the insurer's denial of treatment because she failed to attend an insurer's examination.  In order to make a determination Arbitrator Sapin needed to consider whether or not the insurer's examination was compliant with the SABS. Unifund wanted to send Ms. Augustin to an insurer's examination to determine if she was within the Minor Injury Group (MIG) after receiving a treatment plan that, if approved, would take her out of the MIG.  Unifund provided the following notice to Ms. Augustin in their Explanation of Benefits: "Based on our review of the medical documentation provided to date, we require an assessment by an independent medical assessor, in order to determine if your impairment is predominantly a minor injury as described in the Minor Injury Guideline. Please see the Notice of Examination for further details." Arbitrator Sapin found that this explanation did not comply with Section 38(8) of the SABS because it did not state that Unifund "believes" the MIG applies, or why.  Nor did it state the "medical reasons and all of the other reasons why the insurer considers any goods or services, or the proposed costs of them, not to be reasonable and necessary.  The arbitrator noted that it provided no reason, medical or otherwise, explaining why it refused to pay the benefit. Arbitrator Sapin goes on to explain,

State Farm Barred from Denying Claimant as "Insured" Five Years After MVA

In a recent Ontario Superior Court of Justice decision, State Farm v. Bunyan [2013 ONSC 6670 (CanLII)], State Farm Insurance Company was not allowed to consider an accident benefits claimant as not being an "insured" under the policy five years after the motor vehicle accident. This decision deals with Christian Bunyan, who was a pedestrian who was struck by a truck in Alberta in September of 2007 and suffered catastrophic injuries.  At the time of the accident he did not have a driver's license.  He was dependent on his mother, who lived in Ontario and had a valid automobile insurance policy with State Farm.  Under Ontario law, a person who is considered insured under an Ontario policy can apply for accident benefits in Ontario if their accident occurs anywhere in Canada or the United States. State Farm accepted the accident benefits claim and also accepted that Mr. Bunyan was catastrophically impaired.  Five years after the accident State Farm then took the position that Mr. Bunyan was not dependent on his mother and was, therefore, not deemed to be an "insured person" under the policy.  Mr. Bunyan asserted that he was dependent upon his mother at the time of the accident and that, since State Farm was raising this issue five years after the accident, he had lost the opportunity to apply for benefits through any other insurer.  In other words, if he was not considered dependent on his mother and not eligible for further Ontario accident benefits he would have no other insurer to provide his much-needed benefits. D.L. Corbett J. ruled that Mr. Bunyan was dependent on his mother at the time of the accident and also ruled that State Farm was barred by the legal principal of estoppel from taking this position five years after the accident.  Estoppel basically means that a party is not allowed to assert a fact or a claim inconsistent with a previous position, especially when it has been relied or acted upon by others.  In other words, since State Farm had accepted that Mr. Bunyan was an insured person for five years and Mr. Bunyan had relied on that position and had not applied to other insurers because of that, State Farm was now estopped from changing their position. The Court's decision is also helpful because it expands on what constitutes dependency.  At the time of the accident Mr. Bunyan was living in Alberta, had recently acquired a low-paying job, had recently separated from his girlfriend and their son, and was relying on his mother for financial support.  As Judge Corbett stated in his decision, "It can be difficult to determine precisely when an adult child ceases to be dependant on his parents.  Functionally, the change from dependence to independence is more a transition than an event."

FSCO Arbitrator: Insurer Cannot Dictate Claimant to Have Amputation as a Remedial Procedure

The Financial Services Commission of Ontario (FSCO) has released an arbitration decision regarding the calculation of a whole body impairment rating when assessing whether or not an insured meets the criteria for a catastrophic impairment under the Statutory Accident Benefits Schedule (SABS). Under the Ontario Accident Benefits regulations, an insured who is deemed to be catastrophically impaired has increased limits on various accident benefits. In D.B. and Economical Mutual Insurance Company [FSCO A12-000632] Arbitrator Killoran dealt with the complex issue as to whether or not the insured, D.B., who suffered serious orthopaedic and psychological injuries in a motor vehicle accident in November 2008, suffered at least a 55% whole body impairment rating under the AMA Guidelines, in order for her impairments to be deemed catastrophically impaired. D.B.'s lower leg injuries required five surgeries and she is unable to walk independently.  She is confined to a wheelchair for 99% of her time.  The only time that she does not utilize a wheelchair was when she goes to the washroom, and only with the use of rails. Economical tried to argue that D.B. should have her leg amputated, which would then reduce her impairment rating to the point that she would not meet the criteria for catastrophic impairment. Arbitrator Killoran stated that,

Notice of Insurer's Examinations Must be "Straightforward and Clear": FSCO

A recent decision by the Financial Services Commission of Ontario (FSCO) has clarified that an insurer cannot penalize an accident benefits claimant for not attending an insurer's examination in certain circumstances. In the decision Kelly Quinones and Unifund Assurance Company [FSCO A12-000866] Kelly Quinones wished to dispute Unifund Assurance's stoppage of her attendant care and housekeeping and home maintenance benefits.  Unifund argued that Ms. Quinones was prohibited from proceeding to arbitration pursuant to Section 55(2) of the Statutory Accident Benefits Schedule (SABS) because she had failed to attend the scheduled insurer's examinations. Ms. Quinones' accident benefits insurer, Unifund Assurance, sent out a notice to her that she was required to attend insurer's examinations for the purpose of determining her entitlement to attendant care and housekeeping and home maintenance benefits. In this particular case Unifund did not specify who the assessor would be in their notice and referred to the profession as "OT".  Arbitrator Maggy Murray noted that "OT" is not a regulated health profession.  It was clarified that "OT" was an abbreviation for "Occupational Therapist", which is a regulated health profession.  However, Arbitrator Murray noted that,

Henry v. Gore Upheld: Ontario Court of Appeal

The Ontario Court of Appeal has upheld the decision of Justice Ray in Henry v. Gore Mutual Insurance Company, 2012 ONSC 3687, which found that an automobile insurer must pay an insured the full amount of attendant care benefits as set out in the Form 1 and is not entitled to take a proportional approach to the payment of this benefit. Gore Mutual Insurance argued that its liability for attendant care benefits was limited to the number of hours that the attendant care provider lost from work. Justice Ray did not agree with this approach and stated that a plain reading of the relevant section must be followed. The Honourable Alexandra Hoy, who wrote on behalf of the Court of Appeal, stated the following:

Health Care Professionals: Be sure to use new HCAI Forms starting on November 1, 2012

The Financial Services Commission of Ontario (FSCO) has released a new Assessment and Treatment Plan (OCF-18) form, a new Treatment Confirmation Form (OCF-23) and a new Auto Insurance Standard Invoice (OCF-21) for use effective November 1, 2012.  Older versions of these forms will not be allowed as of that date. You can download these new forms directly from our website by clicking on the links below:
OCF18-2012
OCF21 - 2012
OCF23 - 2012

Attendant Care and Treatment can be Claimed Simultaneously

A recent decision by the Financial Services Commission of Ontario (FSCO) confirms that an insurer cannot necessarily deduct attendant care benefits from times when a claimant is receiving medical or rehabilitation treatment. In Ms. T.N. and The Personal Insurance Company of Canada [FSCO A06-000399] the Arbitrator Suesan Alves stated the following:

Applying to Wrong Insurer is a Reasonable Excuse for Delay in Applying to Correct Insurer for Accident Benefits

A recent arbitration decision by the Financial Services Commission of Ontario (FSCO) confirms that an insurer cannot deny accident benefits if the application is significantly delayed because the claimant applied to the wrong insurer first. In the decision, Egal and Economical [FSCO A10-004057] Arbitrator Judith Killoran concluded that the Applicant, Roda Egal, had a reasonable excuse for the delay in applying for accident benefits with the Economical Insurance Company, because Ms. Egal had originally applied to another insurance company (American Assurance) who was handling her claim.  Economical did not take timely steps to request information to corroborate her claim, but rather simply maintained their position that she had not applied for accident benefits within the timeframes outlined in the Statutory Accident Benefits Schedule (SABS). Furthermore, Arbitrator Killoran ordered a special award in the amount of $5,000.00 against Economical for its unreasonable position.  As stated in her decision,

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