Some insurers want Feb. 1 changes to auto insurance benefits applied retroactively



I recently wrote about a change to provincial law governing car insurance concerning no fault attendant benefits.

The Ontario government quietly changed the law in December, effective Feb. 1, reversing an earlier decision of the Ontario Court of Appeal.

The change restricted the amount of attendant benefits that can be claimed by family members who care for automobile accident victims.

With the law having been changed Feb. 1, one would reasonably think it wouldn’t apply to any accidents that occurred prior to that date.

After all, substantive changes to the law — as opposed to procedural changes — are generally considered to operate prospectively, not retroactively, unless the law is expressly stated to operate retroactively.

The law changing the attendant benefits wasn’t expressly stated to operate retroactively. However, at least two large insurers have notified plaintiffs’ lawyers they are taking the position the change in law operates retroactively and will apply it to accidents that occurred prior to Feb. 1.

This is incredibly mean-spirited.

Taking such an approach is sure to lead to many disputed claims and delayed payments for attendant care accident benefits.

Claims will face lengthy delays as they proceed through mediation and arbitration or court challenges.

Since attendant care benefits are not available for victims who suffer only minor injuries in car crashes and are significant only for those who have suffered catastrophic injuries, this will harm the most vulnerable victims.

Worse, families of accident victims had no reason to contemplate such a change in the law and may have arranged their affairs to be able to access attendant care benefits as the law allowed them to prior to Feb. 1.

Parents or spouses may have left their jobs to provide attendant care — including such things as feeding, dressing, toileting, bathing and administering medication to accident victims — and may now find they will not receive the compensation they had planned on and were entitled to receive.

The Liberal government has the power to fix this.

Just as it passed a regulation changing the law in December, without any advance notice or public consultation, there’s no reason it can’t pass a new regulation specifically stating the change in the law applies only to accidents that occur on or after Feb. 1.

Neglecting to take this step would show bad faith by the provincial government towards accident victims and a lack of regard for procedural fairness.

The timing of the recent clawback, done without any prior consultation with stakeholders, is particularly puzzling, given that the Superintendent of the Financial Services Commission of Ontario is conducting one of its periodic reviews of auto insurance and inviting feedback from the public until Mar. 31.

It’s been suggested the reduction in accident benefits effective Feb. 1 is directly related to the government’s promise to reduce auto insurance premiums by 15%.

I don’t remember NDP Leader Andrea Horwath’s demand for a 15% premium reduction in auto insurance rates being tied to reductions in auto insurance coverage.

I don’t recall Premier Kathleen Wynne announcing the 15% reduction as part of a package which included less insurance coverage.

After all, anybody can promise and deliver an insurance rate reduction if coverage is reduced.

Yet, I haven’t heard any protests from Horwath following the Liberal government’s recent clawback of accident benefits.

Perhaps she believes voters will only remember her demands for the premium reduction and will ignore the fact the reduction is being used as an excuse to reduce coverage and thus harm accident victims and their families.

Both Horwath and Wynne had better hope auto insurance doesn’t rear its head as an issue in the next election. 

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