In Ontario, statutory accident benefits provide compensation to anyone injured in an accident that involves the operation of a motor vehicle. This coverage is available to drivers, passengers, pedestrians and cyclists, regardless who was at fault. Family members not involved in the accident may also have access to benefits if they suffered an injury such as depression, due to the impact of the accident on their loved one who was hurt.
Statutory ‘no fault’ accident benefits also provide coverage for dependents (persons in a household who are dependent on the insured person for financial support or care) even when the dependant is not specifically named in the policy. The Insurance Act s. 224(1) defines an ‘insured’ person as anyone who is insured by a contract “whether named or not” and includes everyone who is entitled to statutory accident benefits under the contract.
In a recent insurance dispute, the key issue to be resolved by the Court was whether or not the injured pedestrian was considered a dependent (as defined under the relevant vehicle insurance policy) and is therefore eligible for no fault benefits. The civil action, Allstate Insurance Company of Canada v. Intact Insurance Company, involves a 76-year-old grandmother who resided with her daughter and son-in-law in Toronto. The injured woman, Ms. Yan, sustained injuries to her right ankle and shoulder after being struck by a car while crossing the street. Ms. Yan made an application for statutory accident benefits under her son-in-law’s Allstate vehicle insurance. The vehicle that struck Ms. Yan was insured by Intact.
Under Allstate’s policy, a dependent is eligible for coverage if they are “principally dependent for financial support or care” on the insured persons. In this case, Ms. Yan was eligible if she was considered dependant on her son-in-law or daughter. But, if she did not qualify as an insured person under Allstate’s policy, Intact would be responsible for providing coverage.
When Allstate received Ms. Yan’s application for benefits, they gave her a notice of dispute indicating that they don’t believe that she is dependent on her daughter or son-in-law for care, and possibly not for financial support, and Allstate would notify Intact that Intact is the first priority insurer if an investigation finds that Ms. Yan is not a dependent.
In this action, the Arbitrator concluded that Ms. Yan is an insured person as defined in the Allstate policy and therefore Allstate must pay accident benefits. Allstate appealed the decision but the Appeal judge agreed with the Arbitrator’s findings and dismissed the appeal.
The Appeal judge believed the Arbitrator was correct in finding that, although the grandmother helped take care of her grandchildren and contributed to chores in the home of her daughter, she was not paid for childcare or housekeeping and no monetary value should be applied to her services, which would have otherwise been carried by her daughter or son-in-law. The Appeal judge also agreed that Ms. Yan’s pension, which she received from the Chinese government and reported on her Income Tax Returns, should be excluded when assessing her financial dependency. And, although Ms. Yan reported that she paid rent on her Income Tax Return, she speaks Mandarin and does not read or write in English; her returns were completed by her son-in-law; and her daughter and son-in-law testified that she doesn’t pay rent or any living expenses, including clothing and medicine. The daughter also paid for her mother’s visits to China every two years which, among other things, allowed her mother to access a pension associated with her previous employment there.
The Appeal judge asserted that the term, ““principally dependent for financial support” refers to a person who mainly relies on another person to provide him or her with the necessities of life, including shelter”. And, the circumstances of this case support the finding that Ms. Yan meets this criterion.