Dagnew v. Echelon Insurance, 2026 CanLII 21048

Citation: Dagnew v. Echelon Insurance, 2026 ONLAT 25-008673/AABS-PI

Licence Appeal Tribunal File Number: 25-008673/AABS

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

Between:

Tsega Dagnew

Applicant

and

Echelon Insurance

Respondent

AMENDED PRELIMINARY DECISION AND ORDER

ADJUDICATOR: Laura Goulet

APPEARANCES:

For the Applicant: Monick Grenier, Counsel

For the Respondent: Evonne Alkhatib, Counsel

Heard: By way of written submissions

OVERVIEW

1Tsega Dagnew, the applicant, was involved in an automobile accident on January 22, 2022, 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, Echelon Insurance, and applied to the Licence Appeal Tribunal – Automobile Accident Benefits Service (the “Tribunal”) for resolution of the dispute.

2In the Case Conference Report and Order dated October 23, 2025, two issues are listed in dispute: income replacement benefits (“IRBs”) and a treatment plan/OCF-18 (“plan”) for physiotherapy.

PRELIMINARY ISSUE

3The preliminary issue to be decided is as follows:

i. Is the applicant barred from proceeding to a hearing because she wilfully made a material misrepresentation when she applied for accident benefits?

RESULT

4The respondent is not required to pay an income replacement benefit (“IRB”) IRBs to the applicant.

5The issue regarding the plan for physiotherapy will proceed to a hearing.

ANALYSIS

The respondent is not required to pay an IRB to the applicant

6For the following reasons, I find on a balance of probabilities that the respondent is not required to pay an IRB to the applicant.

7The respondent submits that the applicant is barred from proceeding with her application for IRBs because she wilfully made a material misrepresentation or failed to disclose a material change in risk.

8Section 233(1) of the Insurance Act makes a claim invalid if the insured provides false information on an application, breaches a term of the contract, or makes a fraudulent or willful false statement on a claim. Subsection (2) states that subsection (1) does not invalidate such statutory accident benefits as are set out in the Schedule.

9Section 31(1)(b) of the Schedule states that an insurer is not required to pay an IRB, a non-earner benefit or a benefit under s. 21, 22, or 23 in respect of any person who has made, or who knows of, a material misrepresentation that induced the insurer to enter into a contract of automobile insurance or who intentionally failed to notify the insurer of a change in a risk material to the contract.

10The respondent refers to the applicant’s application for insurance for a 2009 Dodge Grand Caravan and a 2010 Mazda 3 for the period covering June 23, 2021, to June 23, 2022. The application form required the applicant to indicate any business use for both vehicles and the applicant left these sections blank and marked “pleasure” for “automobile use” for both vehicles. Further, the Certificate of Insurance (“COI”) indicates the vehicle use was “To and From Work – Limited Value.” The respondent submits that the policy was underwritten and issued on the express representation that both vehicles were for personal use.

11The respondent also refers to statutory condition 1(1) of the applicant’s policy, which provides that the insured shall promptly notify the insurer or its local agent in writing of any change in the risk material to the contract and within the insured’s knowledge. The respondent submits that the applicant received the COI and did not contact the respondent to correct the stated vehicle use after beginning DoorDash deliveries, despite her obligation as outlined in statutory condition 1(1).

12The respondent points to the applicant’s DoorDash file, which indicates that she was doing deliveries almost daily from October 23, 2021, to January 22, 2022, the date of the accident.

13The respondent submits that the applicant knew she was using the insured vehicle for DoorDash delivery work, which is a clear commercial use for compensation and that she knew, or ought to reasonably have known, that the policy was for personal use only, and that delivery use represented a significant change in risk. The respondent further submits that this is evident by the fact that the applicant’s husband, an additional driver on the policy, requested the deletion of a vehicle from the policy because he began using the vehicle as a taxi and had obtained his own taxi insurance. The respondent refers to email correspondence dated December 31, 2021, from the broker’s office to Underwriting, confirming this. The respondent submits that, despite her clear knowledge of the distinction between pleasure and commercial use, the applicant failed to take steps to notify the respondent of her DoorDash delivery work.

14The respondent further submits that the applicant continued to conceal her delivery work even after the accident took place because she did not disclose her DoorDash delivery work on her OCF-1, despite being an employee of DoorDash since October of 2021 to the date of loss. Instead, she listed Asmirah Maintenance Services (“AM”) as her employer, although only having worked there for less than one month prior to the date of loss. The respondent refers to the applicant’s OCF-1 dated September 14, 2022, where she indicated that she was employed and working at AM between January 8, 2019, and March 15, 2020, and between January 1, 2022, and January 22, 2022.

15The respondent also submits that the applicant’s OCF-2 dated October 20, 2022, was completed by AM, indicating that she was unemployed in 2021 and receiving EI and child tax benefit and she started to work for DoorDash on October 18, 2021, until January 22, 2022, and AM from January 1, 2022. The respondent points out that the applicant did not request that DoorDash, who had been her employer up to the date of the accident, complete the OCF-2.

16The respondent takes the position that the applicant’s failure to disclose her DoorDash work satisfies the intention requirement in s. 31(1)(b) of the Schedule.

17In addition, the respondent refers to email correspondence dated September 10, 2025, wherein the unit manager at Underwriting confirmed to the adjuster handling the applicant’s claim, that had the respondent been aware that the applicant intended to use, or later began using, her vehicle for DoorDash deliveries, it would not have issued the policy or would have cancelled it pursuant to Rule 19 of its Underwriting manual, which deals with private passenger vehicles used as delivery vehicles. Further, in correspondence dated October 28, 2025, the unit manager at Underwriting explained that had they been aware of the delivery use of the insured vehicle after the policy was issued, there would be a material change in risk, pursuant to Rule 7 of the manual. Rules 7 and 19 specifically allow the insurer to decline to issue, terminate or refuse to renew a contract.

18The respondent submits that the use of a vehicle for delivery purposes materially alters the risk and falls squarely within the respondent’s list of prohibited uses, and this omission deprived the respondent of the opportunity to properly assess, rate, or cancel the risk. The respondent takes the position that the applicant’s non-disclosure of her Door Dash delivery work is a “change of risk material to the contract” as outlined in s. 31(1)(b) of the Schedule.

19The applicant submits that since English is not her first language, she had considerable difficulty understanding communications with the respondent. She refers to a letter dated March 25, 2022 from her counsel to the respondent, requesting that the applicant be provided with assistance completing the OCF-1 and related forms, submitting that the respondent did not act on it. The applicant also refers to the OCF-23 submitted on March 7, 2022, indicating that she was showing signs of a concussion including brain fog, memory difficulty and difficulty with day-to-day tasks. She submits that, despite the absence of assistance from the respondent, injuries sustained in the accident, and the language barrier, she completed forms to the best of her ability and understanding. She further submits that the respondent was aware of the applicant’s language barrier as evidenced by the fact that she required interpreters for the assessments. The applicant also submits that the respondent has not provided any recordings or log notes that, she argues, would likely demonstrate her language barrier.

20The applicant takes the position that given her limitations, it is not reasonable to expect her to have understood nuanced insurance concepts such as material change in risk, commercial versus personal use, or underwriting criteria. Further, the applicant submits, the DoorDash records show her income from this employment is relatively nominal. The applicant argues that failure to comply with an obligation that is not understood cannot properly be characterized as wilful misrepresentation. In addition, the applicant asserts that language barriers and lack of insurance literacy are relevant to assessing whether an insured has acted intentionally or merely made an innocent mistake.

21In reply, the respondent points out that the OCF-1 completed by the applicant expressly states that the language spoken is “English” and there is no indication that interpretation was required. Further, the respondent argues that the applicant fails to acknowledge that she was legally represented at the time she completed and submitted her OCF-1, and therefore she cannot credibly claim that she misunderstood the requirement to disclose all employment in the past fifty-two weeks, nor that she lacked assistance in completing the form.

22The respondent also submits that the use of an interpreter at lengthy assessments involving complex medical terminology has no bearing on whether the applicant could understand a straightforward question on the OCF-1 asking her to list all employment in the fifty-two weeks pre-accident. The respondent takes the position that this is a simple question, and the applicant disclosed her employment with AM but appears to have intentionally omitted her primary source of income from DoorDash.

23The applicant further submits that her counsel advised the respondent by email dated October 20, 2022 that she worked at DoorDash. She also submits that she openly identified her employment with DoorDash in the OCF-2 and had she known this would expose her to allegations of misrepresentation, she would not have disclosed the information. I find that to submit that she would be dishonest to avoid allegations of misrepresentation does not assist the applicant’s position.

24I note that the above referenced email is the same date as the OCF-2 completed by AM, and that in the email, the applicant’s counsel advised the respondent that she “just learned” that the applicant had been collecting EI until it was terminated in October 2021, after which she was working with DoorDash.

25The applicant takes the position that, on these facts, there is no basis to infer that she knowingly misled the respondent or acted with any intent to deceive. The applicant submits that she is not a sophisticated consumer of insurance and did not understand that app-based, part time food delivery might constitute commercial use or create a disclosure obligation. The applicant further submits that there is no evidence that the applicant attempted to hide income, manipulated information, or sought any advantage from not listing DoorDash on her initial forms, or that she was aware her insurance rates would increase by using her vehicle for commercial purposes.

26The applicant also submits that the respondent did not allege that she engaged in wilful misrepresentation until the Case Conference Summary dated October 10, 2025. The applicant argues that after receiving the OCF-2, the respondent continued to adjust the claim as valid, arranging assessments, issuing OCF-9s, communicating with the applicant about medical and psychological benefits, and denying IRBs based solely on medical reasons. The applicant points out that the respondent did not issue any notice purporting to void the policy, did not rely on s. 31(1)(b) of the Schedule, or seek repayment of benefits allegedly paid in error.

27The applicant takes the position that an insurer who continues to treat a policy and claim as valid after becoming aware of the relevant facts is taken to have waived its right to later void coverage on those same facts. The applicant submits that she relied on the respondent’s conduct in continuing to progress the claim, and it would be inequitable to allow the respondent to reverse its position after years of adjustment.

28The applicant also submits that the respondent’s underwriting correspondence indicates that it first considered misrepresentation in August or September 2025, after the application had been commenced, and that raising misrepresentation only after litigation has been initiated is procedurally unfair and inconsistent with the consumer protection purpose of the Schedule. The applicant does not direct me to any authority to substantiate this submission.

29In reply, the respondent argues that its conduct does not amount to waiver or estoppel because there is no evidence of any representation by the respondent, no reliance by the applicant, and no detriment, all of which are required before estoppel can arise. The respondent points out that it did not receive the applicant’s OCF-2 until February of 2023, and it did not receive her DoorDash records until almost three years post-accident, which records confirmed that the accident occurred while she was performing DoorDash deliveries. Further, the applicant did not file her application with the Tribunal until July 2025 wherein she disputed IRBs. The respondent submits that it raised the preliminary issue at the earliest reasonable opportunity, at the October 23, 2025 case conference, immediately after obtaining the necessary confirmation from Underwriting that the applicant’s policy would have been cancelled had she disclosed her DoorDash work. The respondent points out that these facts are inconsistent with any suggestion that it accepted the risk, waived misrepresentation, or led the applicant to believe that commercial use would be overlooked.

30Further, in response to the applicant’s submissions, the respondent asserts that it did not allege an IRB overpayment because no IRBs were ever paid, and that, relying on s. 31(1)(b) of the Schedule does not require the insurer to void the entire policy. In addition, the respondent argues that the applicant provides no authority for the proposition that routine adjustment equals waiver and submits that the Tribunal has repeatedly held that insurers may continue to adjust non-excluded benefits while simultaneously investigating coverage.

31Both parties cited several decisions of the Tribunal. I am not bound by other decisions of the Tribunal, and I find that I must decide in this matter based on a consideration of the specific facts of this case.

32The applicant makes general submissions with respect to how the respondent’s behaviour amounted to waiver. Pursuant to s. 131(1)(b) of the Insurance Act, waiver applies where the insurer’s conduct reasonably causes the insured to believe that the insured’s compliance with the requirement is excused in whole or in part, and the insured acts on that belief to the insured’s detriment. The Divisional Court in Akinyimide v. Economical, 2023 ONSC 5272 (Div. Ct.) confirms that this Tribunal has the jurisdiction to apply s. 131 of the Insurance Act, as a statutory codification of an otherwise equitable remedy; however, this remedial power is discretionary and requires me to be satisfied that granting this remedy is warranted. The applicant does not direct me to evidence to indicate that she suffered any type of detriment by acting on the respondent’s conduct. Accordingly, I find that the applicant’s compliance with s. 31(1)(b) of the Schedule is not excused by any waiver by the respondent. In the circumstances, I am not satisfied that granting this remedy is warranted.

33Based on the following evidence, I find that the applicant intentionally did not notify the respondent of a change in a risk material to the automobile insurance contract:

i. When the applicant completed the OCF-1, she omitted to include DoorDash as her employer, even though she was employed by DoorDash at the time of the accident and had been working for that company almost daily between October 23, 2021, and January 22, 2022.

ii. The applicant indicated that the language she spoke was “English” on the OCF-1. Further, she was legally represented when she completed the form. In the circumstances, I find that she understood the OCF-1 when she was completing it.

iii. I find that the applicant did not voluntarily disclose her employment with DoorDash until it was listed in the OCF-2 that was prepared by her other employer, AM, on October 20, 2022.

iv. I infer from the fact that the automobile policy belonged to the applicant, that she was aware of her husband’s removal of a vehicle from the policy because he was obtaining other insurance involving a commercial use, i.e., taxi services. Accordingly, I find that the applicant was aware of the difference between personal use and commercial use of a vehicle.

v. I find that, based on the respondent’s Underwriting evidence, the applicant’s use of her vehicle for DoorDash deliveries was a prohibited commercial use, and the respondent would not have issued or maintained the policy had this use been disclosed. Accordingly, I find that the applicant’s employment with DoorDash is a material fact because it would have influenced the respondent’s decision to issue, terminate or refuse to renew the contract.

34Non-compliance with s. 31(1)(b) of the Schedule by an insured does not result in a bar to a hearing, but rather relieves the insurer from paying an IRB, a non-earner benefit or a benefit under s. 21, 22, or 23.

35For these reasons, I find on a balance of probabilities that the respondent is not required to pay an IRB to the applicant because she did not notify the respondent of a change in a risk material to the contract pursuant to section 31(1)(b) of the Schedule.

The issue regarding the plan for physiotherapy will proceed to a hearing

36Since I did not find that the applicant is barred from proceeding to a hearing, the issue regarding the plan for physiotherapy will proceed to a hearing.

ORDER

37The respondent is not required to pay an IRB to the applicant.

38The issue regarding the plan for physiotherapy will proceed to a hearing.