February 5, 2015


In an ill-considered and heartless move, the Province has forced the disabled to loan money to insurers at rock-bottom rates not available in the market place.

As of January 1, 2015, insurers who withhold payments they are otherwise required by law to pay to insured persons for medical and rehabilitation treatment, and income disability payments, will only have to pay interest at 1.3% simple interest once the insured files a mediation application with the Financial Services Commission. Filing the application is a mandatory first step in forcing an intransigent insurer to pay

Unfortunate for the disabled person who very often puts treatment bills on credit cards or lines of credit taken out against their homes. Those who cannot work, incur debt at double-digit rates while only recovering a portion of their income and expenses.

This is fortunate for the insurers. Now, they have virtually no incentive to pay their insureds what they legally owe. How would the CEO explain timely payment to the shareholders? It is financial folly to pay out when even modest investments would return substantially higher rates of return than what they have to pay to their insureds. The amendment makes no sense: it creates a disincentive to insureds to act quickly to force insurers to pay by filing mediation applications (before a mediation application is filed, interest is 1% per month- still much less than credit card rates).

What do we predict? Foot dragging by insurers who are completely disincentived to pay, making matters worse. Claims examiners encouraging unsophisticated victims to file mediation applications so the insurer’s costs go down.

Why are we here? Because this government like those before it continues to buy the drivel handed out by insurers that they are poor and will leave Ontario if their never-ending demands for reductions in benefits are not met. It is false. Insurers continue to buy up businesses in Ontario and are making historic amounts from auto insurance.

Call your member of the legislature today. Enough is enough.

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