The Ontario Rehab Alliance is thrilled to announce its recognition for Corporate Fellowship by the Ontario Brain Injury Association (OBIA)

Below, Nick Gurevich, President of the Ontario Rehab Alliance, proudly accepts the award from Ruth Wilcock at OBIA ‘s  Annual General Meeting this past Saturday, June 21st.  

Do Canadians have all the facts on insurance?

52% wouldn't clarify details of their policies: TD State of Insurance Report

June 19, 2013

From deductibles to deferred premiums, many Canadians don’t understand the ins and outs of their insurance coverage. According to new research from TD Insurance, one-in-two Canadians (52%) wouldn’t ask their insurance provider to clarify details they don’t understand in their policy.

The State of Insurance Report, an annual report commissioned by TD Insurance to understand Canadians’ habits, attitudes and knowledge about insurance, found that Canadians do not ask for clarification on their policies because they think it is too complicated (31%), don’t have time (31%), are embarrassed by their lack of knowledge (23%) or are simply uninterested (19%).

Moreover, while a majority of Canadians (55%) review their insurance policies at least once a year, not everyone takes the time to ensure they are properly insured.

Thirty-seven percent of Canadians admit they didn’t bother to review, or even skim, the fine print on their insurance policies. As a result, 23% have been upset to learn that they weren’t covered for something they thought was covered, and 15% have been pleasantly surprised to find they had more coverage than they thought.

“When you renew your insurance, or reach a milestone in life like buying a new car, a home or have recently completed renovations, spend some time reviewing your coverage,” says Dave Minor, a vice-president at TD Insurance. “Your insurance needs may change from one year to the next and your coverage could have changed, too. Call your insurance provider if you have any questions about adjustments or if your coverage no longer reflects your lifestyle.”

Broken down by province, British Columbians are among those most likely in the country to review their insurance policies at least once a year (64% versus 55% nationally). However, half of British Columbians wouldn’t ask their insurance provider to clarify details they don’t understand in their policy.

Though 57% of Albertans review their insurance policies at least once a year, they are the least likely in the country to ask their insurance provider to clarify details they don’t understand in their policy (61% versus 52% nationally).

Similarly, 54% of Ontarians review their insurance policies at least once a year and over half of them (56%) wouldn’t ask their insurance provider to clarify details they don’t understand in their policy.

Auto insurance rates rise 6.4 per cent in Ontario

 Ian Palmer on July 5, 2013

Kanetix has announced its quarterly year-over-year auto insurance rate study results for Q2 2011 for Ontario, Quebec and Alberta.

The online insurance quote comparison service noted, among other things, the following:

• Ontario auto insurance rates increased 6.4 per cent in Q2 2011, compared to Q2 2010. Rates have been stabilizing since last year’s auto insurance reforms with Q4 2010 and Q1 2011 indicating a 9.5 per cent and 6.7 per cent increase respectively. The year-over-year difference in rate increases is dropping.
• Drivers in Quebec and Alberta were able to take advantage of rates that were relatively stable in Q2. Modest increases were observed in both provinces; 0.2 per cent in Quebec and 1.4 per cent in Alberta.

When consumers are feeling strapped for cash because of rising gas prices and insurance rates, they may be able to relieve some of the strain on their wallets by reviewing their auto insurance policy.

“Although rates are higher compared to last year, consumers can still find ways to lower their auto insurance premiums if they ensure they are taking advantage of available discounts and take the time to understand other cost-saving options that are available,” said George Small, co-founder, Kanetix, in a statement. “At Kanetix, we feel that consumers can take advantage of more discounts than they do today – discounts which could help reduce their rates.”

The Kanetix rate study revealed more than 50 per cent of consumers in Ontario did not take advantage of the multi-line discount that is available to them. For most insurance companies, this discount can range from 5 to 15 per cent. It was also noted that more than 50 per cent did not opt in to the Roadside Assistance discount, and approximately 20 per cent did not take advantage of the winter tire discount that many insurance companies offer.

The study also determined that more customers could save money on their premium by opting for a higher deductible. Policyholders who switch from a $500 deductible to a $1000 deductible could save between 5 and 10 per cent. Nevertheless, drivers should choose an affordable deductible in the event of a claim. 

FSCO arbitrator rules stoppage of benefits form invalid

DAILY NEWS Jun 10, 2013

An arbitrator for the Financial Services Commission of Ontario recently ruled that a form used in the past by auto carriers to notify claimants that their income replacement benefits are being stopped is confusing and unclear.

FSCO arbitrator Jessica Kowalski ruled June 5 that a claimant with Western Assurance Company who had income replacement stopped seven years ago may now proceed to arbitration.

She also ruled that a notice of stoppage of weekly benefits and request for assessment (Form OCF-17), dated July 29, 2004, is void. Western Assurance had argued that it was a valid stoppage form.

FSCO records indicate that the claimant, who was rear-ended in August 2001 by a dump truck, received income replacement  benefits to August 13, 2004. The previous month, he was given an OCF-17 form, which is no longer in use.

The issue is whether the July 29, 2004 OCF-17 was “sufficient to start the running of the two-year limitation period,” and if so, whether the claimant was barred by law from proceeding with his claim for income replacement. The carrier had argued that he was barred.

The two-year limitation period she referred to is Section 281 of the Insurance Act, which states that a mediation, evaluation, court proceeding or arbitration “shall be commenced within two years after the insurer's refusal to pay the benefit claimed.”

Form OCF-17 included the reason the claimant's benefits were being stopped, as well as information on mediation and the right to arbitrate if mediation fails.

The main problem, Kowalski suggested, was part 5 of OCF-17, which is titled “applicant request and signature.” This is where the claimant was asked to sign the form, which notes the claimant disagrees with the stoppage of benefits and requests an assessment at a designated assessment centre (DAC) to determine whether he or she continues to have a disability that entitles the claimant to receive benefits.

“Rather than describing the DAC as an option available to the insured person, it tells an insured person that if he or she does not sign the portion of the form requesting an assessment by a DAC, then he or she cannot continue on to mediation or more if she or he disagrees with the stoppage of benefits,” Kowalski wrote. 

However, Kowalski noted the law did not require the claimant to request or attend a DAC before applying for mediation.

“While he had a right to request a DAC, it was not a prerequisite to disagreeing with the insurer's decision to stop benefits.”

Therefore, she wrote, Part 5 of OCF-17 “imposed a requirement on an insured person that was not required” by the Statutory Accident Benefits Schedule (SABS), the form “did not constitute a proper refusal” and therefore the two-year limitation period did not begin to run in July of 2004.

Quoting from the Supreme Court of Canada decision in 2002 in the case of Smith versus Co-operators General Insurance Company, Kowalski noted that when refusing benefits, insurers must “inform insured persons of the dispute resolution process in straightforward and clear language directed towards and unsophisticated person.”

The Supreme Court of Canada ruling was in the case of Bernadette Smith, who was in an accident in 1994. Her carrier stopped paying benefits in May, 1996. Mediation started in 1997 but failed, and she sued the carrier in 1998.

The carrier had asked for a ruling that Smith's claim was time-barred. This motion was granted in 1999 and upheld in 2000 by the Ontario Court of Appeal.

But the highest court in the land overturned that ruling, even though The Co-operators had used a form prescribed by the Commissioner of Insurance.

“The industry practice of using the form prescribed by the Commissioner cannot somehow be a substitute for conformity” with SABS, which requires that insurers refusing benefits shall inform the claimant of the dispute resolution process, Mr. Justice Charles Gonthier wrote on behalf of the majority of the Supreme Court of Canada at the time. “There is no indication that insurers are legally prevented from adding to the prescribed form so that it is in conformity with the legal requirements.”

Insurers, regulator counter auto rate hike claim

Thompson’s World Insurance News 
    Insurers and the provincial regulator say that Ontario auto insurance rates are coming down despite claims from the New Democratic Party that premiums are rising in anticipation of the recently-mandated cut. 
    “It is too simplistic to raise a couple of examples of rate increases without knowing the entire story,” said Ralph Palumbo, vp of IBC for Ontario.
    “We categorically reject any suggestion that rate increases represent an attempt to raise premiums in anticipation of proposed rate decreases as part of the Liberal government’s sensible cost reduction strategy. 
    The reality is that any current rate increase is based on rate filings made by insurers and approved by the provincial regulator well before the NDP demanded an arbitrary rate cut. To suggest otherwise is irresponsible.”
    Auto insurance rates are approved quarterly by the Financial Services Commission of Ontario. Rates approved during the first quarter of 2013 declined on average by 0.03%, based on the entire market.
    “An individual’s rates may change for a number of reasons: if they have moved, bought anew car or had a change in driving record,” Mr.Palumbo said.
    Kristen Rose of the Financial Services Commission of Ontario noted that auto insurance rates declined an average of 0.26% in 2012 and decreased further in the first quarter.
    She said it’s worth noting that when consumers see a rate change on their policy, they may be seeing a change that was approved six months to a year ago.
    “Consumers need to remember that their premiums vary based on their individual risk characteristics as well as the insurance company
    they use. 
    To ensure they’re getting the best possible deal, consumers need to shop around.”
    More in our June 10, 2013 edition

Don’t wait on Ontario auto outcomes to make necessary changes, OSFI head tells insurers

 DAILY NEWS Jun 7, 2013

 While it may take some time for insurers to see the full impact of proposed changes related to auto insurance in Ontario, companies need to ensure they’re not entering into lines they may not understand, the head of the Office of the Superintendent of Financial Services has cautioned.

In remarks at an event organized by the Northwind Professional Institute in Cambridge, Ont. on June 6, Julie Dickson said that “OSFI will be looking at how companies are affected by and manage the Ontario proposals.”

Among those proposals, included in the Liberal provincial government’s budget for 2013, is to reduce auto insurance premiums by an average of 15% (although no timeline has yet been specified), and to reduce the return on equity benchmark from the current 12%.

“…If Ontario auto insurance business starts to lose money and companies decide to enter new markets or begin selling new products as a way of making up the losses, companies will need to ensure that they are not replacing one risk with a new risk — namely operating in a market they do not understand,” Dickson said.

Companies that already have a low ROE from “ineffective underwriting, lack of claims management, etc.” also shouldn’t use the Ontario proposals to avoid making a needed change, she cautioned.

OSFI expects insurers to consider the Minimum Capital Test (MCT) in their rate-making process, she noted. The organization also expects that Own Risk and Solvency Assessments (ORSA) will help with companies considering moving in and out of lines of business, Dickson said.

OSFI has released a discussion paper outlining proposed changes for the 2015 MCT framework, and the final version will be released after consultations, but in advance of the implementation date, she added.

“It is important not to make the mistake of thinking that the ORSA process is for actuaries alone,” Dickson said. “…The board and the CEO must take responsibility for a company’s ORSA for the process to be effective.”

You’re paying too much for insurance: critics

Jun 06, 2013

York Regional Police fraud investigators noticed a disturbing trend in auto insurance claims around the region in 2010.

Probes into nine suspected fraudulent insurance and medical claims turned up $5 million worth of fraud.

In response, the force’s major fraud unit launched Project Sideswipe, a nine-month probe that concentrated on staged collisions and the rehabilitation, assessment centres and paralegal services used by drivers and others involved.

People were recruited by an orchestrater to be a driver or passenger in staged collisions using cars that were old and irreparable, police said.

They would report the crashes to police, saying they were the only occupant in the car to avoid investigation. Yet they would tell insurance companies there were five passengers or, in one case, seven, in their vehicle, Det.-Const. Kim Tanczos said.

The drivers and passengers would then falsely file injury claims related to soft tissue, police said.

The claims were made for services never rendered through rehabilitation facilities, where doctors’ signatures and information were fraudulently used, according to police.

In August, 51 suspects were charged with 201 offences, including fraud over $5,000 and obstructing police.

In December, nine suspects, including medical personnel and office managers, were charged with 41 offences, including money laundering.

Following the arrests, the organized crime ring was dismantled, significantly reducing the number of false claims, according to police.

Aurora Banner

ByJeremy Grimaldi

Ontario’s auto insurance industry is widely regarded as the most expensive in the country — with some customers paying almost twice the premiums as drivers in other regions.

For years, the industry’s well-funded association has blamed the high prices, in large part, on the excessive amount of fraud committed by customers.

But weeks after the province called for a 15-per-cent rate cut in its annual budget, the chorus of voices questioning this assertion is growing.

The Insurance Bureau of Canada often cites $1.6 billion as the dollar figure for phoney claims in Ontario, based on an estimate by auditor KPMG.

In reality, though, many say the picture is not so simplistic.

For 2010, KPMG pegged fraud at $768 million to $1.56 billion.

The Ontario Trial Lawyers Association dismisses the number outright, saying the discrepancy is so “enormous as to be meaningless”.

“I’m not saying it’s not a problem, but it’s not as big of a problem as they say it is,” association president Andrew Murray said.

Meanwhile, the Consumers’ Association of Canada questions why, if the bureau is so determined to curb insurance fraud, it has just 10 staff investigators and almost as many lobbyists at Queen’s Park, according to the registry.

“If they cared so much about fraud, they would hire more investigators,” consumer association president Bruce Cran said. “This fraud business is always exaggerated. It is one of their favourite smoke-and-mirror techniques.”

The figures also prompted Mr. Murray to question where the bureau’s priorities lie.

However, bureau communications vice-president James Geuzebroek rejected the insinuation the organization is not entirely committed to lowering costs for consumers, noting individual insurance companies also employ their own fraud investigators.

The bureau’s government relations outreach goal is to bring about change to keep auto insurance affordable and to remove some of the other costs in the system and red tape, he said.

“I think that says that our industry is keenly interested in keeping down costs.”

High auto insurance rates make consumers angry and that’s not good for any company, he said.

“No industry wants the public to be resentful of the product they are delivering.”

Ontario has a “Cadillac system, so we have Cadillac prices”, he added.

However, this is only one thread of a detailed argument about high insurance costs.

Questioned, too, is the amount of money being made — and lost — in the industry.

Since September 2010, when then-finance minister Dwight Duncan lowered minor injury benefits for victims from $100,000 to $3,500, the industry has made about $2 billion a year, Mr. Murray said.

This contributed to an overall industry profit of $1.5 billion in 2011, his association contends.

Yet despite these industry-wide cost savings, rates continued to rise in 2010.

They fell 2011 and 2012 by .26 and .03 per cent, respectively.

His was one of the first organizations to say with all the claim costs going down, there shouldn’t be a reduction in premiums, Mr. Murray said.

While his group has never suggested insurance companies can’t make a profit, “people have to be able to afford the product”, he added.

But Mr. Geuzebroek contends the industry makes 10 cents or less on every dollar consumers spend, with the rest going to claims, taxes and expenses.

Between 2008 and 2010, the industry lost an average of $1 billion a year. In 2010, it was $1.7 billion, he said.

However, Mr. Murray attributes those numbers to an industry allowed to set aside reserves from revenues before they are officially logged.

These reserves are squirrelled away for future insurance-related incidents companies may have to fund, he said.

“Not showing profit is not quite the same as losing money. It’s still there,” he added.

By his calculations, if people are no longer allowed to claim large amounts for minor injuries, the fraud problem is dealt with, Mr. Murray said.

However, rates are staying largely the same, year after year.

“I think they are being hoisted on their own petard here,” he added. “I think they are repeating an argument that’s already been addressed.”

So just how much more are Ontario driver spending than someone in other parts of

the country?

On average, 5.3 per cent ($1,527) of Ontarian’s disposable income is spent on auto insurance, according to IBC’s numbers, compared to 3.2 per cent ($846) in Atlantic Canada and 2.8 per cent ($1,069) in Alberta.

When asked if Ontario may benefit from a public system, such as the ones instituted in other provinces with lower costs, Mr. Geuzabroek said a government-run monopoly is no way to run an insurance system.

In response to Mr. Geuzabroek’s claim of a lack of impartiality and “strong vested interest” on the part of the lawyers association, Mr. Murray said he is perfectly positioned to speak on the issue because he meets with injured people every day.

“We’re the only ones able to speak for people who haven’t even yet been impaired,” he said. “I meet with people every day that I can’t do anything for … because of our system. Does that make me biased or informed?”

The politician who drafted the motion included in the government’s latest budget said although it may not result in a 15-per-cent cut, it will cause awareness about the issue.

The move is a strategic one to bring attention to the issue, said NDP Bramalea—Gore—Malton MPP Jagmeet Singh, the party’s justice and consumer services critic.

“The industry is benefiting from the most historic savings they have ever had. That needs to be passed on to the consumer.”

Rhona DesRoches from FAIR, an association of victims for accident insurance reform, said she agrees with fellow advocates, but her campaign focuses on the lack of oversight within the insurance industry rather than mere costs.

The concern is about how the victims have been treated, she said.

The recently published anti-fraud task force report on fraud in the industry is entirely focused on fraud by clients, rather than fraud committed on the other side, she said.

“What they didn’t look at was the insurers themselves. If an insurance adjuster defrauds you, there’s no one to call. Adjusters can say, ‘I don’t think you’re injured’ while having no medical qualifications and sometimes are holding up claims for years. That puts the consumer at risk.”

Mr. Murray is calling for the auditor general to get involved and conduct a full investigation of Ontario’s insurance industry.

“We wouldn’t usually do that to a private company,” he said. “But it’s a mandatory product.”