If you become injured in any type of motor vehicle accident, whether as a driver, passenger, pedestrian or cyclist, you can claim accident benefits from the vehicle insurance policy of the at fault driver. The dollar amount of benefits you are eligible to receive depends on the severity of your injuries – ‘minor injury guidelines’ defines the lowest level of benefits under the Statutory Accident Benefits Schedule (SABS), while ‘catastrophic impairment’ is the highest injury designation.
Further, there are deadlines for making a claim for accident benefits and claimants may be barred from receiving benefits if they miss any of these deadlines. The first deadline requires that you report the accident to your insurance company, or the insurer with whom you’re making the claim, within seven days of the accident. If you fail to meet this timeline, your claim may be accepted only if you have a very compelling reason for filing late. When you report your intent to file an injury claim, your insurer should give you an Application for Accident Benefits, which needs to be completed and submitted to the insurance company within 30 days.
In Tomec v. Economical Mutual Insurance Company (2018), an Ontario Court upheld a decision by the Licence Appeal Tribunal which ruled in favour of the insurance company. The Court decided that the claimant was not entitled to claim attendant care and housekeeping benefits from the auto insurance company past the two-year deadline that was specified in a letter from the insurer. The letter gave the claimant two years to contest the insurer’s assessment of her claim, which was based on a non-catastrophic injury designation. The Court was faced with deciding whether the limitation period defined under the Statutory Accident Benefits Schedule (SABS) is ‘hard and fast’ and blocks a person from making a claim after the limitation period expires, even when they weren’t previously aware that their severity of injury made them eligible for claiming benefits.
Background and Analysis: Tomec v. Economical Mutual Insurance Company
The claimant became injured on September 12, 2008, when she was struck by a car while walking across the street at an intersection. She sustained several injuries, including multiple fractures in her left shoulder, for which she required surgery.
The claimant submitted an application for accident benefits on October 13, 2008. She was approved for, and received, attendant care and housekeeping benefits until two years from the date of the accident (until September 12, 2010). At this time, she was eligible for benefits based on a non-catastrophic impairment designation.
On August 10, 2010, the claimant’s physician submitted an application to the insurer for approval to have the injured women assessed for catastrophic impairment. The insurer subsequently sent the claimant an Application for Benefits form on August 26th which included statements indicating that, in accordance with the SABS (section 18(2) and 22(3)), neither attendant care benefits, or housekeeping and home maintenance benefits, “are payable for expenses incurred more than 104 weeks after the accident unless you have been determined to have sustained a Catastrophic Impairment as defined by the Statutory Accident Benefits Schedule”. The statements were accompanied by a letter which noted that, if the claimant disagreed with, and wished to, dispute the insurer’s assessment of her claim, she needs to commence mediation within 2 years of having received the letter.
It was not until May 13, 2015; however, that the claimant’s doctor submitted an Application for Determination of Catastrophic Impairment to the insurer. Medical evidence for her catastrophic impairment was provided by her treating orthopedic surgeon who prepared a report stating that, as a result of the collision, the claimant developed osteoarthritis in her left knee which necessitated that she walk with a cane. Further, the surgeon stated that he now found that “contracture of the soft tissues around her shoulder joint, including the capsule, glenohumeral ligaments and rotator cuff tendon complex resulted in permanent and untreatable loss of movement”.
In response to her application, the claimant underwent several examinations in August and September of 2015, from which a physiatrist concluded that she met and even surpassed the threshold for catastrophic impairment. The insurer notified the claimant that her application for catastrophic impairment was accepted; however, the insurer denied payment of owed past benefits as well as ongoing attendant care and housekeeping benefits on the grounds that these benefits were denied at the two-year mark and the claimant failed to medicate this denial within two years of the denial.
The claimant filed an application to the Licence Appeal Tribunal to dispute the insurer’s denial of housekeeping and attendant care benefits because they were barred for being too late. The Tribunal heard the case and decided that, despite having a catastrophic impairment, the claimant is barred from applying for the benefits because she failed to dispute the termination of those benefits within two years from the date of the insurer’s denial dated August 26, 2010. The Tribunal rejected the claimant’s argument that the denial in 2010 was not valid because she was not yet found to be catastrophically impaired. The Tribunal Vice-Chair referred to Sietzema v. Economical Mutual Insurance Co. (2014), where the Court found that even if the insurer’s reasons for denial are legally incorrect, “the two-year limitation period nevertheless commences to run on the date of the denial”. And, the Tribunal’s decision was later upheld by an Ontario Court in 2018.
The Tomec decision that the limitation period is firm and inflexible resulted in a very substantial reduction in owed benefits for the claimant. Currently, an accident victim who sustains a catastrophic impairment, as defined by SABS, is eligible to receive up to $1 million in combined attendant care/medical/rehabilitation expenses over their lifetime, as compared to a maximum of $65,000 for up to 5 years for someone who sustains a non-catastrophic impairment. Certainly, these are hugely different amounts and are life-changing for persons who require help with housekeeping functions and home maintenance and need long-term attendant care, rehabilitation treatments or medical aids.