Seriously injured accident benefit claimants in Ontario no longer are required to dispute a “catastrophic impairment” denial within two years from the date of the denial, according to a recent arbitration decision.
Because qualifying as having suffered a “catastrophic impairment” allows an Ontario motor vehicle accident claimant to essentially access an extra $2-million in needed benefits, the determination is crucial both to the claimant and to the responsible insurer.
There are a handful of different tests that can be relied on to qualify as having suffered a “catastrophic impairment” (CAT) under the Ontario Statutory Accident Benefit Schedule. Those tests have been subject to a number of recent Ontario Court of Appeal cases that have clarified how they should be properly interpreted.
Some of the CAT tests can be accessed immediately following an accident (such as the criteria of having a valid Glasgow Coma Scale reading of nine or less from a brain impairment following an accident), while other tests can only be accessed two years postaccident or when the injuries have clearly stabilized.
Plaintiffs’ personal-injury lawyers work hard determining how best to advance a claim for a “catastrophic impairment” designation. With limited accident benefits available until the determination is favourably made, there is significant pressure to advance a CAT claim as soon as possible.
The recent arbitrator’s decision sheds light on this. In Do v. Guarantee Company of North America (FSCO A11-000718), the accident victim submitted an application for a catastrophic impairment determination in December, 2006, 14 months following his October, 2005 accident. In May, 2007, Guarantee relied on the findings of a series of multidisciplinary insurer examinations and concluded that he did not sustain a catastrophic impairment.
The SABS at that time provided the accident victim with an opportunity to have a rebuttal report prepared at the insurer’s expense and he did so. The rebuttal assessors concluded that he did in fact suffer a catastrophic impairment. A further paper review was then authored by the insurer examiner, and in April, 2008, the insurer sent another explanation of benefits maintaining its denial of a “catastrophic impairment” designation. A mediation was filed with the Financial Services Commission of Ontario within two years of the April, 2008, denial (but not within two years of the original May, 2007, denial).
The issue in Do was whether the claimant had to mediate the CAT denial within two years of the May, 2007, denial or within two years of the April, 2008, confirmation of denial.
In her decision last Nov. 6, arbitrator Suesan Alves reviewed the two-year limitation period set out in s. 281.1 of the Ontario Insurance Act. She noted that it refers to mediating “within two years after the insurer’s refusal to pay the benefit claimed.”
Alves concluded that only a denial of a “benefit” triggers the two-year limitation period in s. 281.1, not a determination of a “catastrophic impairment” designation. Alternatively, the arbitrator said that, if she is wrong on this issue, the later date of April, 2008, when the “final” refusal was made, applies to start the limitation period.
The Do decision is a step forward for accident victims. It will allow personal-injury plaintiffs’ lawyers time to wait before disputing catastrophic impairment designations, and this additional time is often needed to evaluate how the claimant’s injuries progress and to consider judicial interpretation of the various “catastrophic impairment” entitlement tests.
Darcy Merkur is a partner at Thomson Rogers in Toronto, practising plaintiffs’ personal-injury litigation, including plaintiffs’ motor vehicle litigation, and is certified as a specialist in civil litigation by the Law Society of Ontario.