MIG Update – January 22, 2024
Defective Notices Do Not Trigger Limitation
This week’s MIG case involves a limitation issue raised by the insurer on 3 treatments plans that were denied in 2018 and 2019. In the absence of the Applicant’s submissions the Tribunal reviewed the notice letters associated with the treatment plans in question to determine whether the notice was sufficient to trigger limitation. This case provides an analysis of the reasons provided, the standard set out by the courts and why the notices failed to meet that standard.
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Factor: Defective Notices Do Not Trigger Limitation
In St. Nicolous v. Intact Insurance Company (23-002528), Soosaipillai St. Nicolous was involved in an accident on March 25, 2018, and sought entitlement to three Treatment Plans for chiropractic services, denied August 9, 2018, chronic pain assessment denied April 22, 2019 and a psychological assessment denied July 13, 2018 totaling $5890.38.
Intact raised a preliminary issue stating that St. Nicholas should be barred from proceeding with his claim because he failed to commence his Application within two years after its refusal to pay the amount claimed.
The Tribunal held that in order for the limitation period set out under s56 to be triggered the denial notice must be proper in accordance with the principle set out in the SCC decision Smith v Cooperators. Not only must the notice outline the dispute resolution process and the relevant time limits that govern the process, the notice must contain straightforward and clear language and be specific and accessible as possible to ensure there is no ambiguity as to what the notice means when read by an unsophisticated person.
Further, the notice must provide a valid medical and any other reasons for the denial as set out in Hedley v Aviva which in turn applied the principles set out by the Tribunal in T. F. v Peel Mutual wherein the Executive Chair Lamereaux stated at para 19:
[…] an insurer’s “medical and any other reasons” should, at the very least, include specific details about the insured’s condition forming the basis for the insurer’s decision or, alternatively, identify information about the insured’s condition that the insurer does not have but requires. Additionally, an insurer should also refer to the specific benefit or determination at issue, along with any section of the Schedule upon which it relies. Ultimately, an insurer’s “medical and any other reasons” should be clear and sufficient enough to allow an unsophisticated person to make an informed decision to either accept or dispute the decision at issue. Only then will the explanation serve the Schedule’s consumer protection goal.
Using these principles the Tribunal found:
- The notice should explain the medical conditions and why those conditions do not justify entitlement to the benefit claimed. The court in Hedley found that boilerplate medical reasons for denials of treatment plans constitute no reasons at all. Further, those reasons must be meaningful in order to permit an insured person to decide whether or not to challenge the insurer’s determination
- “If an insurer’s notice of denial to an insured person does not satisfy these requirements, the denial may be determined to be invalid and accordingly fails to trigger the two-year limitation period.”
- All 3 letters essentially contained the same medical reason and were all found to be defective. The reasons provided were vague and not geared towards an unsophisticated person. No reference is made as to what St. Nicholas’ medical condition or impairments are. Nor any explanation regarding how having a pre-existing medical condition may result in being removed from the MIG.
- The medical reasons in the letter dated August 9, 2018 for chiropractic services in the amount of $1,650.00. “Based on the medical information on file, injuries as a result of the accident fall within the Minor Injury Guideline. Treatment has previously been approved to the Minor injury guideline limits of $3500.” The denial letter also states that there is insufficient compelling evidence which indicates that the applicant has a pre-existing medical condition that would prevent him from reaching maximum medical recovery.
- The medical reasons in the letter dated April 22, 2019 for a chronic pain assessment in the amount $1,989.85. “Treatment plan not deemed reasonable and necessary as a result of the accident. Based on the medical information on file, injuries fall within the Minor Injury Guideline. Treatment has previously been approved to the Minor Injury Guideline limits.” The denial letter also states that there is insufficient compelling evidence which indicates that the applicant has a pre-existing medical condition that would prevent him from reaching maximum medical recovery.
- The medical reasons in the letter letter dated July 13, 2019 for the psychological assessment in the amount of $2,250.53. “There is insufficient compelling evidence such as pre-existing injuries or conditions or medical documentation to suggest that the accident injuries fall outside of the Minor Injury Guideline and if they are reasonable and necessary.”
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