TORONTO INJURY LAWYER BLOG

Sometimes, the Toronto Injury Lawyer Blog examines recent cases that we think our readership will enjoy. We do our best not to make the legal analysis too technical, because that just turns in to a snooze fest. We want to keep things light, upbeat and easy/enjoyable to read. The law can be very dry and we don’t want our blog to become a bore.

Reading the Ontario Reports this week, we came across an interesting Long Term Disability Benefits decision involving a disability claimant, Ms. Garneau; and her LTD insurer, Industrial Alliance.

The decision was taken to Ontario’s Highest Court, (just shy of the Supreme Court of Canada); to the Ontario Court of Appeal on Queen St. in Toronto.

The decision appeal decision of Garneau v. Industrial Alliance Insurance and Financial Servics Inc. 2015, ONCA 234 can be read here. The motion for a reduction in set offs at the Superior Court level can be read here. The initial decision which was being appealed can be read here.

What makes this case so interesting for our law firm? Read on and we will share with you.

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One of the most commonly asked questions of clients at my law firm is “how much is my case worth?”

This is never an easy question to answer.  When assessing the value of a claim, particularly an LTD claim, there are a variety of factors which need to be examined such as:

• The age of the LTD Claimant
• The duration which benefits are payable under the policy (age 65 or earlier?)
• Were any back payments/arrears paid out by the LTD Insurer or not?
• The value of the monthly LTD benefit
• Are there any set offs which the LTD insurer is entitled to under the policy such as CPP, WSIB or otherwise
• Is there an all source maximum deduction at play
• What are the nature of the injuries causing the disability and are those injuries likely to heal
• What the claimant’s doctors have to say about a potential return to work
• What the insurer doctors have to say about the injuries and the potential return to work
• Has the insurer conducted any surveillance (real time, online, cyber or otherwise) and what does that surveillance show
• What sort of education, training and work experience does the claimant have
• Can the claimant read and write in English or French
• What is the employability potential of the claimant following the LTD claim
• Has there been any bad faith handling of the LTD file on the part of the insurer. If so, what is the nature of that bad faith claims handling and how has it impacted the claimant’s entitlement to LTD benefits?

The value of the LTD claim depends in large part on how the above noted questions are answered, amongst other factors which may be unique to one’s case.

Unlike other injury or accident cases, LTD claims are largely assessed based on mathematical equations. Take the value of the LTD benefit, less any off sets, by the number of months owing in arrears and future benefits owing by the insurer; et voila; you will have the maximum exposure owing by an insurer.

In a car accident claim, the award for pain and suffering, is somewhat subjectively based on historical precedent of cases built over the years. There are different heads of damages for car accident claims such as pain and suffering, past/future income loss, housekeeping claim, attendant care claim, claim for out of pocket expenses, claim for past and future care costs, claim for a modified home or vehicle, family law act claim for loss of guidance care and companionship etc. On the tort end of a car accident claim, there are a variety of heads of damages upon which to base a claim.

LTD claims are different because many of these heads of damages simply don’t exist. LTD claims are contract claims. No contract of insurance; NO CLAIM. Because they are contractual claims, they are based primarily on what’s contained inside of the policy and its wording. These are NOT claims for pain and suffering. These are claims for past and future benefits, based on an amount as defined and calculated pursuant to the policy. Therefore, establishing damages is not based on legal precedent. It’s based on what the policy says, along with the factors set out above.

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A Long Term Disability policy of insurance (LTD Policy), is a policy designed to cover the insured for a monthly benefit in the event that person becomes disabled.

These policies are often offered by employers, to employees as a part of their benefits package. It’s a common perk of employment. Like saying that you work at Google, and they offer a generous benefits package. That package includes LTD Benefits. The nice thing about this is that the employee has a benefits package. The bad thing about it is that the employee doesn’t have much say about what goes in to that benefits package, how much those benefits are worth, and the benefits will likely cease when the employee ends his/her employment relationship with the employer. No longer an employee of Google? Then no more LTD benefits are available to you.

Other times, LTD Benefits are purchased privately through an insurance broker. In this instance, the policy holder (that’s you) gets to pick the right amount of coverage which best suits their lifestyle and financial situation. The LTD benefits are NOT tied down to a specific employer. They follow the insured person from job to job. These benefits are great for contractors, self-employed persons, people who don’t have benefits offered through their employer, or even people who have benefits offered through their employer, but just want additional coverage because the coverage offered through their employer isn’t necessarily the best.

Some of the large companies who offer LTD benefits (both group and individual policies) are Great West Life, Canada Life, Sun Life, Standard Life, Manulife, RBC Insurance, Industrial Alliance, Co-Operators Insurance, Desjardins, SSQ and Equitable Life just to name a few.

As you can see, there are quite a few LTD Insurers out there to chose from. It’s important to note that each policy is different. What’s most important to the insured, is how the policy works to get you paid in the event of disability.

The term “disability” is a VERY broad term. Don’t believe me? Here are a few insurance examples from car insurance policies, and LTD policies which define what it means to be “disabled” to receive benefits under their policies.

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