VK v. Unica Insurance Inc., 2019 CanLII 43885

Citation: VK vs. Unica Insurance Inc., 2019 ONLAT 18-007227/AABS

Date: April 29, 2019

In the matter of an Application pursuant to subsection 280(2) of the Insurance Act, RSO 1990, c I.8., in relation to statutory accident benefits.

Between:

VK

Applicant

and

Unica Insurance Inc.

Respondent

DECISION

ADJUDICATOR:

Christopher A. Ferguson

Appearances:

For the Appellant:

VK, Applicant

Nathan Tischler, Counsel

For the Respondent:

Angela L Comella, Counsel

Heard: In Writing

Hearing: February 4, 2019

REASONS FOR DECISION

OVERVIEW

1VK was injured in an automobile accident on June 25, 2015 and sought benefits pursuant to the Statutory Accident Benefits Schedule – Effective September 1, 2010¹ (the ''Schedule'').

2VK applied for benefits from Unica, and applied to the Licence Appeal Tribunal (“Tribunal”) when the disputed benefits were denied.

3The issues in dispute include VK’s entitlement to the costs of a number of assessments conducted to determine whether or not VK suffers a catastrophic (“CAT”) impairment as a result of the accident.

4Unica believes that the disputed costs of assessments to CAT impairment (to which I will refer as “CAT assessments”) are included on the cap on medical benefits prescribed in the Schedule. VK contends that they are not.

5On November 15, 2018, the Tribunal ordered a preliminary hearing to determine the issue raised in paragraph four above. The Order indicates that once the preliminary issue is decided, a case conference shall be scheduled to determine next steps in resolving any remaining substantive issues.

PRELIMINARY ISSUE

6Are assessments to determine catastrophic impairment (“CAT assessments”) included as part of the $50,000.00 (“$50K”) limit on medical rehabilitation benefits prescribed by the Schedule?

FINDINGS

7CAT assessments are not included as part of the $50,000.00 limit on medical rehabilitation benefits prescribed by the Schedule.

REASONS

CAT Assessments

8Section 18(3) of the Schedule sets a $50K limit on medical and rehabilitation benefits payable to insured persons unless they are catastrophically impaired. The limit includes the costs of medical and rehabilitation assessments.

9Section 25(1)5 of the Schedule requires the insurer to pay reasonable fees charged for preparing an application for determination of CAT impairment under s.45, including any assessment or examination necessary for that purpose.

10Section 45 of the Schedule prescribes the process for making an application for determination of CAT impairment, and contemplates medical examinations as part of the application process.

Background

11VK submitted a treatment plan (“OCF-18”) requesting a CAT assessment in the amount of $17,005.50. Unica agreed to partially approve the claimed assessment and fund it up to $11,752.00.

12VK applied to the Tribunal disputing Unica’s denial of various treatment plans, among other issues, on August 1, 2018. On August 7, 2018, Unica’s accident benefits (AB) adjuster advised VK’s counsel by e-mail that his coverage for medical and rehabilitation benefits had been exhausted. This was followed by a letter dated August 8, 2018.

13On August 9, 2018, VK’s counsel wrote to Unica objecting to the Respondent's position that his CAT assessments should be funded out of his policy limits for medical and rehabilitation coverage.

14On October 17, 2018, VK received CAT assessments which indicated that he was not catastrophically impaired as a result of the accident. Accordingly, the available funding for coverage of VK’s medical and rehabilitation benefits remained capped at $50,000.00.

Is the cost of CAT assessments covered by the s.18 cap?

15Unica urges me “as a starting point” to adopt its interpretation of a guiding principle in this matter: the goal of further cost reduction in the auto insurance system which was stated in an entry on the Ontario Regulatory Registry (ORR) which was posted to notify the public of amendments to the Schedule that became effective on June 1, 2016²

16Using this “guiding goal”, Unica urges a reading of the Schedule which it submits clearly prescribes that CAT assessments are included in the cap on benefits because s.18(5) of the Schedule states:

For the purposes of subsections (1 ) and (3), medical and rehabilitation benefits payable in respect of an insured person include all fees and expenses for conducting assessments and examinations and preparing reports in connection with anv benefit or payment [emphasis is the respondent’s] to or for an insured person under this Regulation.

17I am unpersuaded by Unica’s assertion that the cost reduction goal should carry decisive weight in determining this issue because:

i. Unica’s assertion is unaccompanied by any analysis to support its proposition that a cost reduction goal set by lawmakers should be connected to any decision as to what specific things should be included under the cap on non-CAT benefits. Financial caps or limits are not synonymous with coverage inclusions or exclusions.

ii. A brief descriptor in an ORR notification pertaining to one purpose of amendments to the Schedule cannot, in my view, be credibly extrapolated to provide an overarching statement of how to interpret the entire Schedule. No evidence was provided to me as to how this goal should be weighed against other goals of the Schedule and the body of insurance law within which it operates: one of those primary goals is consumer protection³ and more specifically, to provide timely access to medical treatment to improve recovery regardless of fault.⁴

18Unica urges me to find that a CAT assessment is, contrary to VK’s position, conducted “in connection with any benefit or payment to or for an insured person” [emphasis Unica’s]. Unica states: “While the designation of catastrophic impairment is not a benefit in and of itself, the designation does have a ‘connection’ with benefits and/or payments to or for the insured person. The designation of a CAT impairment is the ‘connection’ or bridge which allows the Applicant access to additional payments and benefits under the Schedule.”

19Unica submits that I should ignore or discount precedents cited by VK to support her position that CAT assessments are excluded from the $50K cap, such as 17-007962 v. Scottish and York⁵ because the respondents in those cases have appealed or asked for reconsideration of the Tribunal’s decisions to exclude CAT assessments from the cap on non-CAT medical benefits. Unica has not indicated how or why they are distinguishable from this case, and I can find no reason to ignore these cases simply because insurers disagree with the results. These decisions will remain persuasive to me until and unless they are reversed, and I find both decisions highly persuasive in this case.

20I agree with VK that the costs of CAT assessments are funded outside the cap on medical and rehabilitation benefits for the following reasons:

i. My own reading of s.25(1)5 of the Schedule is that it clearly covers CAT assessments. I agree with the reasoning in Henderson⁶ that “there is no room for ambiguity – the insurer shall pay the expenses of a CAT assessment”. Other adjudicators have reached the same conclusion.⁷ I find that this means that the insurer is obliged to pay the full cost of a CAT assessment, without any cap but subject, of course, to professional services guidelines and with the caveat that it remains the applicant’s responsibility to show that any assessment is reasonable and necessary.

ii. I find that the “connection” that Unica urges me to make between CAT assessments and benefits in my view, stretches the wording of s.18(5) too far. My reading of s.18(5) is that it plainly refers to assessments in direct connection with any specific payment or benefit because:

a. I find the term “in connection with” to mean that the section only caps payment for medical benefits by non-CAT impaired persons, and that this narrow restriction excludes assessments not directly related to a specific benefit (or benefits) or payment.

b. I agree with VK that exclusion clauses should be interpreted narrowly and coverage clauses broadly, as when interpreting insurance policies.⁸ I find it reasonable to interpret the Schedule’s provisions on coverage limits, exclusions and inclusions using the same principles set out by the Court in Derksen. In this light, Unica’s argument for including CAT assessment costs in the $50K cap would, if adopted, effectively excludes VK from a significant portion of the coverage for medical benefits available to him (see below).

c. I am mindful that even if deemed CAT impaired, an insured person must still show that each and every medical benefit or assessment is reasonable and necessary. A CAT determination is no ticket to some “extra pocket of funding” described by Unica in its submissions.

iii. I reject Unica’s submission that I should ignore or discount the decisions cited by VK simply because the respondents in those cases have asked that they be reviewed. Unica does not indicate how or why these cases are distinguishable from this case, and I can find no reason to ignore these cases simply because insurers disagree with the results. The decisions led by VK remain persuasive to me until and unless they are reversed, and I find both decisions highly persuasive in this case.

iv. I concur with a body of decisions that CAT determinations are not a benefit, and neither are assessments required to apply for CAT determination. This further persuades me that CAT assessments are not included in any limit placed on payment for benefits.⁹

v. Unica does not contest VK’s point that a number of FSCO¹⁰ and Tribunal decisions have ruled that CAT determination expenses should not be deducted from the medical and rehabilitation benefit policy limits. As VK states: “FSCO, [the Tribunal] and all levels of Court have never ruled to the contrary.” I also agree with VK that “certainty in the law requires that courts and other adjudicative bodies follow and apply authoritative precedents. This is the foundational principle upon which the common law relies.”¹¹ And I see no reason not to follow it.

vi. In 17-007962 v Scottish and York,¹² I rejected the respondent insurer’s proposition that a decision by lawmakers in 2010 to lower the cap for non-CAT medical and rehabilitation benefits from $100,000 to $50,000 should be used to interpret this issue because of a “clear intent to limit recovery”. I find no connection between a decision to lower a monetary cap and any decision as to what things should be included under that cap; similarly, I find no connection between a stated, general goal of cost reduction and any determination of what specifically is included or excluded in the $50K cap.

vii. The effect of deducting CAT assessment costs from the $50K available to “not-yet-CAT” accident victims would be to force seriously injured people to plan to hold a significant percentage of entitlement – in this case 34% -- in reserve, just in case they need a CAT assessment. This would represent a serious deterrent to seeking needed medical treatment, or alternatively act as a major barrier to seeking CAT determination. I find it simply unbelievable that such obvious effects are intended or supported by any reasonable interpretation of the Schedule and they are clearly inconsistent, as VK notes, with the consumer protection objective of insurance law.

CONCLUSIONS

21CAT assessments are not covered by the $50K cap on medical benefits prescribed by s.18(3) of the Schedule.

22An applicant’s approved costs for CAT assessment cannot be deducted from the $50K cap set by s.18(3) of the Schedule. They are payable under s.25 of the Schedule.

Date of Issue: April 30, 2019

___________________________

Christopher A. Ferguson

Adjudicator

Footnotes

1. 1O.Reg. 34/10
2. 2Ontario's Regulatory Registry posting re: Reg. 251/15, 2015 Queen's Printer for Ontario
3. 3Consumer protection was confirmed as one of the main objectives of insurance law in Smith v Cooperators General Insurance Company Co., [2002] 2 SCR, 2002 SCC 30, led by VK
4. 417-000835 v. Aviva General Insurance Canada, 2018 CanLII 83520 (ON LAT), led by VK.
5. 517-007962 v. Scottish and York, 2018 CanLII 81950 (ON LAT)
6. 6Henderson v. Wawanesa Mutual Insurance Company, FSCO A-14-001758 – referenced in Unica’s submissions
7. 7See for example 16-000258 v Wawanesa Mutual Insurance Company, 2017 CanLII 9809 (ON LAT) – submitted by VK.
8. 8Derksen v. 539938 Ontario Ltd., [2001] 3 SCR 398, 2001 SCC 72, para. 48-52, led by VK (“Derksen”)
9. 9For example, M F.Z. v Aviva Insurance Canada, 2017 CanLII 63632 (ON LAT) – submitted by VK, supported by the courts in such decisions as Machaj v. REC General Insurance Company, 2016 ONCA 257 also included in VK’s submissions.
10. 10Financial Services Commission of Ontario, whose adjudicators used to hear automobile accident benefits appeals.
11. 11Relying on Canada (Attorney General) v. Bedford, [2013] 3 SCR 1101, 2013 SCC 72
12. 12See footnote 4.