Sivakumar v. TD General Insurance Company, 2023 ONLAT 23-000153/AABS-PI
Licence Appeal Tribunal File Number: 23-000153/AABS
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:
Parthipan Sivakumar
Applicant
and
TD General Insurance Company
Respondent
PRELIMINARY ISSUE HEARING DECISION AND ORDER
ADJUDICATOR:
Tavlin Kaur
APPEARANCES:
For the Applicant:
Siyamson Pathmanathan, Counsel
For the Respondent:
Bhagwant Chohan, Counsel
Heard by way of written submissions
OVERVIEW
1Parthipan Sivakumar, the applicant, was involved in an automobile accident on July 2, 2020, and sought benefits pursuant to the Statutory Accident Benefits Schedule – Effective September 1, 2010 (including amendments effective June 1, 2016) (the “Schedule”). The applicant was denied benefits by the respondent, TD Insurance (“TD”), and applied to the Licence Appeal Tribunal – Automobile Accident Benefits Service (the “Tribunal”) for resolution of the dispute.
PRELIMINARY ISSUE IN DISPUTE
2Is the applicant statute barred from proceeding with their claim for issues 2 and 3 for failing to submit an application within two years after the insurer’s refusal to pay the amount claimed, as per s.56 of the Schedule?
RESULT
3The applicant may proceed with the OCF-18 in the amount of $3,696.50 for chiropractic services.
4The applicant may proceed with the OCF-18 in the amount of $2,026.55 for chiropractic services.
ANALYSIS
Parties’ positions
5The respondent submits that the applicant is statute barred from proceeding with the application by virtue of section 56. The applicant had ample opportunity to submit the application to the Tribunal and was notified that there was a two-year limitation period for bringing an application. However, the applicant failed to do so.
6The applicant did not file any submissions or evidence.
The Law
7Section 56 of the Schedule provides that an application to dispute a denial of a benefit shall be commenced within two years of the insurer’s refusal to pay.
8In order for the provision under section 56 to be triggered, I must determine whether the respondent’s notice of denial was proper in accordance with the principles set out in Smith v. Co-operators General Insurance Co, 2002 SCC 30 (“Smith”). According to Smith, the refusal to pay the benefit must contain straightforward and clear language, it must be directed towards an unsophisticated person, it must outline the dispute resolution process and the relevant time limits that govern the process, and it must provide valid or other reasons for the denial.
9Defining with precision an unsophisticated person is a challenging task; however, the Court’s direction in Smith clearly recognizes that greater accessibility of an insured person to the informational content of the denial notice is of paramount importance and must necessarily account for the variety of persons and backgrounds who may make claims for accident benefits. Accordingly, Smith requires a denial notice to be as specific and accessible as possible to ensure that there is no ambiguity in what a notice means when read by an unsophisticated person.
10Further, the notice must provide a valid medical and any other reason for the denial. I note that the Divisional Court in Hedley v. Aviva Insurance Company of Canada (“Hedley”), 2019 ONSC 5318 considered the reconsideration decision of B.H. v. Aviva Insurance Company, which in turn applied T.F. v. Peel Mutual Insurance Company, 2018 CanLII 39373 (ON LAT) (“T.F.”). The Court found no basis to intervene as the decision was within the reasonable range of outcomes.
11The principles were set out by the Tribunal in T.F. in which Executive Chair Lamoureux stated, at para. 19:
[…] an insurer’s “medical and any other reasons” should, at the very least, include specific details about the insured’s condition forming the basis for the insurer’s decision or, alternatively, identify information about the insured’s condition that the insurer does not have but requires. Additionally, an insurer should also refer to the specific benefit or determination at issue, along with any section of the Schedule upon which it relies. Ultimately, an insurer’s “medical and any other reasons” should be clear and sufficient enough to allow an unsophisticated person to make an informed decision to either accept or dispute the decision at issue. Only then will the explanation serve the Schedule’s consumer protection goal.
12This means the notice at the very least should explain what the insured person’s medical conditions are and why those conditions do not justify entitlement to the benefit claimed. By providing this information, the insured person will have a better understanding of the insurer’s determination. It is then that the consumer protection mandate of the Schedule is achieved.
13Moreover, I note that the Court in Hedley found that boilerplate medical reasons for denials of treatment plans submitted under the Schedule constitute as no reasons at all. Reasons must be meaningful in order to permit the insured person to decide whether or not to challenge the insurer’s determination.
14If an insurer’s notice of denial to an insured person does not satisfy these requirements, the denial may be determined to be invalid and fail to trigger the two-year limitation period.
15However, if the notice of denial does satisfy these requirements, then the onus is on the applicant to establish reasonable grounds for an extension under section 7 of the Licence Appeal Tribunal Act (“LAT Act”). Section 7 of the Licence Appeal Tribunal Act, 1999 (“LAT Act”) allows the Tribunal to extend a limitation period. In considering whether to exercise its discretion to extend the limitation period, the Tribunal must consider the following four factors to determine if the justice of the case requires the extension:
a) A bona fide intention to appeal within the limitation period;
b) The length of delay;
c) Prejudice to the other party; and
d) Merits of the appeal.
The denial dated July 22, 2020 for the OCF-18 in the amount of $3,696.50 for chiropractic services is defective
16I have reviewed the letter dated July 22, 2020 and find that it does not comply with the requirements under section 38(8). There are no references made to his medical conditions. It is unclear what his medical conditions or impairments are. Furthermore, there is a reference to the Minor Injury Guideline, but the respondent does not set out the definition. In my view, the reasons provided are vague. It appears that the respondent has used boilerplate wording and therefore, these reasons constitute as no reasons at all in accordance with Hedley. I find that the letter dated July 22, 2020 is not in compliance with s. 38(8) of the Schedule. The notice of denial did not meet the basic requirements outlined in Smith and therefore the two-year limitation period was not triggered.
17As I have determined that the limitation period was not triggered by an invalid denial, the applicant may proceed with their application before the Tribunal.
The denial letter dated November 23, 2020 for the OCF-18 in the amount of $2,026.55 for chiropractic services is defective
18I have reviewed the letter dated November 23, 2020 and find that it does not comply with the requirements under section 38(8). There are no references made to his medical conditions. It is unclear what his medical conditions or impairments are. The following reason is provided:
We are currently awaiting the completion of the section 44. We will add this to the assessment. Based on the above rationale, we will not pay for the above goods and/or services and the OCF-18 will not be subject to an Examination required by insurer.”
19In my view, the reasons are confusing and are not proper reasons. The respondent has not used straightforward and clear language to explain why they are denying the applicant. Moreover, these reasons do not explain why the treatment plan is not reasonable and necessary. I find that the letter dated November 23, 2020 is not in compliance with s. 38(8) of the Schedule.
20The notice of denial did not meet the basic requirements outlined in Smith and therefore the two-year limitation period was not triggered.
ORDER
21It is ordered that the applicant may proceed with her application before the Tribunal.
Released: October 24, 2023
___________________________
Tavlin Kaur
Adjudicator