Car insurance is a product that we are required by law to have in Ontario. As a product, it is the protection against possible unfortunate situations; the possibility of being in car accident, the possibility of being injured, the possibility of injuring someone else.
In our case of Smith v. Co-operators General Insurance Co.,  2 S.C.R. 129 (S.C.C.) Steve Rastin argued before the Supreme Court of Canada that the insured person, Ms. Smith, was not given a proper refusal by her insurance company when she was denied further benefits. The Smith case is a reminder of the importance of protecting the little guy, the consumer in the world of insurance.
The Supreme Court of Canada said that the insurance company is required to inform the insured of the dispute resolution process and the applicable time limits in straightforward and clear language.
16 years later, Smith v. Co-operators is still good law. The case was recently applied by the Ontario Divisional court in Aviva Canada v. Sidhu.
Mr. Sidhu was in a car accident in 1996 and received income replacement benefits. In May 1996, Aviva, the insurance company, notified Mr. Sidhu that it was terminating his benefits. He exercised his right to be assessed at a Designated Assessment Centre (DAC). The DAC concluded that Mr. Sidhu was not disabled. In September of 1996, Aviva sent Mr. Sidhu a letter restating the insurance company’s position that Mr. Sidhu was not entitled to further benefits.
For 18 years, Mr. Sidhu and Aviva Insurance did not contact one another.
In 2014, Mr. Sidhu applied to mediate his entitlement to benefits from the 1996 accident. The mediation failed and Mr. Sidhu then applied to arbitrate the issue.
The Arbitrator found that Aviva’s documentation failed to state the time limits for Mr. Sidhu to exercise his rights (normally two years from the time of denial). Since the notices did not meet the Smith requirements, the limitation period had not run. Aviva insurance conceded that their notices did not meet the Smith requirements.
The Divisional Court reviewed the lower Arbitration decisions and dismissed Aviva’s application for Judicial Review stating:
In my view, given the requirements of Smith, the interpretation of Smith in Golic, and Aviva's concession that its notice did not meet the Smith requirements, it was reasonable for the Delegate to hold that Aviva had failed to meet its obligation to provide a proper denial notice and that the limitation period had not started to run.
Have you have been denied benefits from your insurance company? You do not have to go through this difficult situation alone. Give Rastin Law a call for a free consultation at 1-844-RASTIN1 (727-8461).