“No Fault” Means No Benefits When You Most Need Them

By Alan Shanoff ,Toronto Sun
First posted: Saturday, February 18, 2012 07:43 PM EST
The main rationale for no fault car insurance accident benefits is simple.
We want people injured in car accidents, regardless of who is at fault, to have quick access to medical and rehabilitation benefits not covered by OHIP, without having to go through the lengthy and expensive process of a lawsuit.
By doing this, we help them recover more quickly and try to prevent their injuries from becoming worse.
But increasingly, the injured are unable to obtain expeditious access to benefits due to the growing practice of insurance companies denying requests for treatment.
According to a survey released last month by the Alliance of Community Medical & Rehabilitation Providers, representing about 3,500 Ontario health care providers, 42% of all requests for treatment are now being rejected by insurers. (The survey reports the denial rate was 11% prior to September, 2010.)
Under Ontario law, claimants cannot go to court to enforce their no fault accident benefits unless mediation has been sought and has failed. This forces denied claimants into the mediation stream at the Financial Services Commission of Ontario (FSCO).
Mediation is supposed to be fast and cheap. Indeed, the law requires a mediator to attempt to effect a settlement “within sixty days after the date on which the application for the appointment of the mediator is filed.” FSCO rules state mediation must be completed within 60 days of the filing of an application for mediation.
But FSCO, a government body with a self-described mandate “to provide regulatory services that protect the public interest and enhance public confidence in the regulated sectors” takes the position the 60-day period doesn’t start with a claimant’s request for mediation, but only when the FSCO “deems” the application to be filed.
They won’t do that until they appoint a specific mediator for the claim. With current backlogs, mediations don’t take place until 10 to 12 months after the filing of a mediation request.
Last December’s report of the Ontario Auditor General said about 50% of all claims result in mediation requests. With an estimated 36,000 applications for mediation being launched in the current fiscal year, the backlog isn’t likely to decrease.
What are accident victims facing a denial of benefits supposed to do? How can they get the attention of the FSCO and insurers to force them to do something about the backlog?
The Kitchener Waterloo law firm Morell Kelly, for example, has hundreds of clients awaiting mediation. They want the 60-day period enforced, so they started lawsuits for four of their clients who had waited longer than that.
Lawsuits will put pressure on the insurers and that can only help the existing situation.
In this case, the insurers could have negotiated settlements rather than face hefty litigation costs.
Instead, the insurers brought applications to dismiss the lawsuits, arguing they should not have been commenced as no mediations had “failed”.
The insurers adopted the FSCO position that the 60-day period doesn’t start until a mediator had been appointed for a claim.
But Superior Court of Ontario Justice James W. Sloan rejected the insurers’ dismissal applications.
In a Feb. 8 decision, he noted the insurance law is supposed to be consumer legislation and claimants who cannot access accident benefits on a timely basis should not be forced to wait “100, 300 or 500 days for mediation.” He called the insurers’ position “preposterous”.
Mediation is supposed to be fast and inexpensive. Forcing injured people to wait a year for non-binding mediation before they can seek a remedy through the courts or arbitration, encourages insurers to deny claims and creates hardship for claimants waiting for treatment and prescription medication.

This ought to have been thrashed out during last year’s Ontario election campaign. Now, even with our minority government, it seems no party wants to bring this urgent problem to the attention of the Legislature. 

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