Risky business

Why reduce insurance benefits for Ontarians who need them most?

Following closely on the heels of the announcement by Ontario Finance Minister Charles Sousa of a targeted 15% reduction in car insurance premiums, to be phased in over two years, we had a spokesman for the Insurance Bureau of Canada chillingly proclaim, “we’re hoping that they (the provincial government) quickly introduce a new definition of catastrophic impairment. If you want to see some rate reductions, that’s the place to start to make sure that unnecessary costs related to catastrophic injuries are taken out so that money goes to people who really need it.”

But who could possibly need it moreso than the approximately 1% of accident victims (about 600 per year) who suffer catastrophic impairment resulting from auto accidents?

It’s no wonder the insurance lobby is focusing on catastrophic impairment. Accident victims suffering catastrophic impairment are entitled to up to $1 million in medical and rehabilitation benefits.

The catastrophic impairment category remains the last major battleground of the insurance industry. In the last round of amendments, in 2010, the Ontario government reduced med/rehab benefits for non catastrophic injuries. Med/rehab benefits for minor injuries (which in reality aren’t always so minor) were reduced from a maximum of $100,000 to $3,500 while med/rehab benefits for non minor injuries were reduced from a maximum of $100,000 to $50,000. Worse, these limits include the cost of assessments, examinations and reports, meaning that the actual amount available for treatment will be much lower.

In no other province or territory are auto accident victims limited to such a miserly sum as $3,500 for medically necessary treatment. No other province or territory provides a cap on so-called minor injuries. The $50,000 limit is lower than the limits in British Columbia, Manitoba and Saskatchewan. Also, Manitoba, Saskatchewan and Quebec provide medical rehabilitation benefits in excess of Ontario’s $1,000,000 when medically warranted.

Sure, $1 million is a lot of money, but it isn’t paid to accident victims. None of this money goes into the pockets of accident victims. It is paid only to fund “reasonable and necessary expenses incurred” due to an accident. Each victim must demonstrate the need and reasonableness of every item for which they seek payment. The insurance company has the right to question the reasonableness and necessity of any expense.

Obviously accident victims can’t self-diagnose themselves as catastrophically impaired. The designation is provided by medical specialists who must adhere to a complex set of definitions, the very definitions the insurance lobby is pushing to change. Even then insurance companies have the right, which they exercise all too frequently, to require accident victims to be assessed by their own experts and can dispute the designation in a judicial setting, resulting in heart-breaking delays.

Changes to the definition of catastrophic impairment will result in reduced benefits for those who need them the most. It will cause delays in the ability to access necessary medical and rehabilitation services.

We have had the benefit of 15 years of experience and judicial interpretation of the current definition. Personal injury lawyer Darcy Merkur believes that any overhaul of the definition “will lead to uncertainty, delay, complexity” and accident victims will suffer in the interim before “we reach any level of predictability and consistency in the application” of a new definition.

But with their history of contributions to the Ontario Liberal Party it may be difficult for Finance Minister Sousa to resist the insurance industry’s lobbying efforts. The Insurance Bureau of Canada contributed $25,000 to Kathleen Wynne’s leadership campaign. So far this year the IBC has also contributed $20,950 to the Liberals. That doesn’t include contributions made by individual insurance companies including, for example, a further $9,600 by All State and Intact.

Catastrophically impaired accident victims deserve compassion, not a new catastrophic impairment definition which will only result in some of the most deserving victims being unable to access the medical and rehabilitation services they require

_{Source: By Alan Shanoff   ,Toronto Sun First posted: Saturday, August 31, 2013 06:35 PM EDT}