In Hedley v. Aviva Insurance Company of Canada (2019 ONSC 5318), Aviva appealed a Reconsideration Decision from the Licence Appeal Tribunal.
The original hearing involved a dispute over whether Aviva had provided adequate reasons for denying a Treatment Plan submitted by the claimant, Brian Hedley. Hedley had been injured in a collision in March 2014. As he continued to experience ongoing impairments to his lower back and neck more than 2 years after the collision, his occupational therapist submitted treatment and assessment plans in June 2016 for various assistive devices and ongoing treatment. Aviva denied the treatment plans, claiming that they were not reasonable and necessary because the “treatment does not appear consistent with the patient’s diagnosis.” It refused to clarify its position when asked by Hedley.
Under s. 38 of the Statutory Accident Benefits Schedule (SABS), an insurer must provide “the medical reasons and all of the other reasons why the insurer considers any goods, services, assessments and examinations, or the proposed costs of them, not to be reasonable and necessary.” Similarly, it must give, “the medical and any other reasons for the examination” and whether the attendance of the insured person is required at the examination (s. 44).
At the LAT hearing, Adjudicator Flude held that Aviva had provided adequate notice under the SABS, and that the treatment plans had been properly denied. Hedley brought a request for Reconsideration before Executive Chair Lamoureux of the LAT. He claimed that the adjudicator had made a significant error of law in reaching the decision, by expanding upon or interpreting the Aviva’s “medical reasons”with reference to the medical documentation on file.
Executive Chair Lamoureux agreed with Hedley. She referred to her decision in 16-003316/AABS v. Peel Mutual Insurance Company, which held that an insurer will satisfy its obligation under s. 38(8) if it offers a principled rationale based fairly on an insured’s file. From this perspective, Aviva was required to explain the alleged inconsistency with reference to the medical evidence in support of its opinion. Otherwise, an insurer could “justify any denial of a plan by merely stating that it had reviewed the plan in light of the medical documentation on file, and without providing any meaningful detail, assert that the plan was not appropriate given the insured’s condition.”
Aviva appealed to the Division Court of the Superior Court of Justice. In a brief Endorsement, Justice Bell dismissed the appeal. He observed that Executive Chair Lamoureux’s reasons agreed with the Ontario Court of Appeal decision in Turner v. State Farm Mutual Automobile Insurance Company (2005 CanLII 2551), which held, “that where reasons are required, they must be meaningful in order to permit the insured to decide whether or not to challenge the insurer’s determination. Mere “boilerplate” statements do not provide a principled rationale to which an insured can respond. In essence, such statements constitute no reasons at all “. As a result, it was reasonable to conclude that the Adjudicator erred in his interpretation of ss. 38(8) and 44(5) of the SABS.
Therefore, Justice Bell dismissed the appeal.
This decision is important for car accident victims, because it clarifies and reinforces the obligation on insurers to provide adequate reasons for denying treatment or scheduling Assessments. If you have been seriously injured in a car accident, and have questions relating to this decision, a denial of treatment by your insurance company, or your claim generally, we are pleased to offer a free consultation. Campisi LLP – Clients First, Excellence Always!