In a LAT decision released in January of 2022 ( Jarrett v Aviva https://canlii.ca/t/jlw35) the courts started the year off by reminding Ontario’s injured car crash survivors they shouldn’t look to the justice system to hold insurers accountable for their poor claims handling practices.
This isn’t new but it was a little bit like saying the quiet part out loud with “The legislature made a choice as to what disputes would be within the exclusive jurisdiction of the LAT, and what remedial powers the LAT would have. That was a policy choice it was entitled to make.” Arbitrator Craig Mazerolle went on to say, “Without a regulation allowing for damages, I am satisfied that the Legislature understood the consequences of its actions during the transfer of accident benefit disputes to the Tribunal, and it—in turn—decided not to provide the Tribunal with the power to grant damages (as used to be ordered by the courts).”
Suffice to say that most consumers wouldn’t know that Ontario legislators decide what coverage will or won’t be available to them, nor would they know that there are no safeguards in place to ensure that Ontario’s insurance companies actually stand behind the contracts they have with Ontario drivers. As Arbitrator Mazerolle explains it in Jarrett v Aviva, “despite the applicant’s arguments about the lack of remedies available to those who claim bad faith adjusting of designations, as well as the special role of punitive damages noted in Whiten—it was within the Legislature’s purview to remove this remedial power from the Tribunal.”
Any hope of accountability is explained away with a quote from a 2021 LAT AABS decision “an insured person’s right to file bad faith claims for punitive damages is no longer available. Further, that this was a policy choice made by the legislature. In coming to that conclusion, the Court states that the purpose of the legislature’s policy decision was to reduce insurance rates and provide for the fast and efficient resolution of disputes and avoid a duplication of processes. Of significance, the Court states that the legislature must have considered “the importance of its objectives of efficiency and cost reduction to outweigh the loss of insured individuals’ access to the courts and to the full range of remedies available there.”
In the Jarrett v Aviva decision it is clear the courts follow the legislation to the letter and squarely lay the responsibility for failing consumers at the legislators’ feet with, “the Tribunal must respect the Legislature’s role in crafting social policy, and, in turn, it must respect the choice to not include punitive damages in its remedial toolbox”. This profound failure to protect consumers from ultra-rich and unaccountable insurance companies has left Ontario’s injured patients with no tools in their toolbox and with little hope of recovering the costs of their recovery journey. Of great concern to all of us should be the fact that taxpayers pay when insurers don’t by way of social support like OW and ODSP along with increased OHIP costs as consumers frantically search for ways to recover from their injuries.
The previous Liberal government is responsible for the mess we find ourselves in today with some 16,000 injured car crash survivors applying for hearings at the LAT in just the last year alone in order to get the benefits they paid for. The Liberals made promises of ‘more choices’ but ended up making bad deals with insurers and leaving patients in the lurch. It’s created a huge backlog of cases because the current Conservative government has done nothing to course correct the downward spiral of insurance quality that was kick-started by the Liberals removing disincentives for insurers who behave badly. Quietly the significant interest insurers had to pay claimants for overdue benefits disappeared from legislation along with the ‘special award’ payable for bad behavior. The reality is the insurers are in the game to make profit, not friends. And screwing Ontario patients out of the resources they need is a profitable endeavor that has no downside because there’s no accountability and there is no price to be paid for manhandling their own customers.
So what is a car crash survivor supposed to do? How can we change insurers’ claims handling practices? If the last stop on the road to recovery is a court that won’t or can’t help us, what steps should we take? I put the question to some of our supporters and was surprised to hear of some good outcomes coming from unexpected places and some suggestions.
If the Brokers are the individuals who sell us the product and tell us it’s good coverage, why are we not looping them into the catastrophe that blows up our lives when the product they sold us turns out to be useless? Apparently some are willing to step up and reach out on their customer’s behalf to the insurer that THEY recommended. It’s true that many Brokers are now owned and operated by insurance companies but not all are, and every one of them ought to know which companies behave badly. One Broker we know of did reach out to their customer’s insurance adjuster and somehow effected a change that helped get their customer the help they needed.
And what about your insurance company’s Ombudsman? They all have one dedicated to their company and as one lawyer recently reminded FAIR, sometimes it only takes fresh eyes or a new perspective to change the course of adjusting a claim. It may be more likely a lawyer who would be more successful at effecting change at this level but for those self representing it is worth a try. And if not successful with your insurance company Ombudsman, there is always the General Insurance Ombudsman to follow up with (although the GIO website indicates they will only get involved if there is not a legal case ongoing) and it is another step to put pressure on an insurer to do the right thing.
There is also the FSRA complaints system that considers whether your auto insurance company has violated Ontario’s Insurance Act and/or regulations or has been subjecting you to Unfair or Deceptive Acts or Practices (UDAP). You do not have to access any of the above suggestions before making a FSRA complaint and there is a lot of information on their website that will help you articulate how your insurance company may have broken the rules.
Last, but not least, what about your local MPP? The legislators who enacted the current legislation are mostly out of the picture now but those who currently represent you are the representatives who can and should make legislative changes to protect vulnerable car crash survivors. In addition they need to know how badly Ontario’s patients are being treated in what is a private medical system where profit is more important than recovery and how that affects us all. A phone call to an insurer from an MPP could make all the difference in how your claim is handled.
We aren’t convinced that our past legislators truly “understood the consequences of its actions during the transfer of accident benefit disputes to the Tribunal” or that they understood the outcomes, both physical and financial, for both injured car crash patients or for the taxpayers when changes to coverage to assist insurers were made. Ontario cannot afford to bargain away more coverage so informing government representatives is a significant action that might cause hesitation to undermine justice going forward.
By Rhona DesRoches Feb 2, 2022
- Jarrett v Aviva Insurance Company of Canada, 2022 CanLII 2762 (ON LAT), <https://canlii.ca/t/jlw35
- AJ v. Security National Insurance Co., 2021 CanLII 35586 (ON LAT), <https://canlii.ca/t/jfnzp
- Registered Insurance Brokers of Ontario (RIBO) FAIR TREATMENT OF CUSTOMERS (2019) https://www.ribo.com/wp-content/uploads/2022/01/RIBO-Fair-Treatment-of-Customers-2019.pdf
- To see locate the Ombudsman from your particular insurer, access by hitting the first letter of your insurer’s name on the tiny blue bar at: http://licensingcomplaintofficers.fsco.gov.on.ca/ComplaintsOfficerListing/eng/leDefault.aspx
- GENERAL INSURANCE OMBUDSERVICE (GIO) is a Canada-wide external independent body that can assist consumers with most disputes involving complaints about property, auto, or business insurance that consumers have been unable to resolve with their insurer. https://giocanada.org/
- Link to individual insurer websites and general information/contacts who are members of the General Insurance OmbudService https://giocanada.org/member-companies/
- Instructions on how to resolve an auto insurance complaint on the Financial Services Regulatory Authority (FSRA) page at: https://www.fsrao.ca/consumers/auto-insurance/how-resolve-auto-insurance-complaint
- Accessing Form No.:IF-018E: https://www.fsrao.ca/industry/home-life-and-health-insurance-sector/general-insurance-forms-and-documents/if-018
- Find your MPP contact: https://www.ola.org/en/members/current/ministers