February 25, 2016

The Zero Sum Game: Insureds must pursue zero value benefits to protect the future

Bonaccorso v. Optimum Insurance Company,  [2016] O.N.C.A. 34


Sue Noorloos

Sue Noorloos

Bonaccorso, the Plaintiff, made a claim for income replacement benefits (IRB’s) which was dismissed on a summary judgment motion. She unsuccessfully appealed the decision to the Court of Appeal.


The Plaintiff received IRB’s after a collision then returned to work full time on June 28, 2009. On February 8, 2010, the insurer advised the Plaintiff, by letter, that benefits were discontinued effective June 28, 2009. The letter was accompanied by an Explanation of Benefits (EOB) and a warning of the two year limitation period. The Plaintiff continued to work until February 15, 2011 when she ceased employment due to injuries sustained in the collision. A reinstatement of benefits was sought on July 13, 2012. The Insurer denied the request on the basis the limitation had expired.


The Motion Judge and the Court of Appeal both agreed that the limitation period had tolled. The Insurer’s letter of February 8, 2010 was a refusal sufficient to commence the running of the relevant two year limitation period. Optimum had appropriately explained the process to dispute the discontinuance of IRB’s and set out the two year time limit in which the Plaintiff could dispute the decision. Specifically, s. 37(2) of the SABS permits the discontinuation of payment of a specified benefit if the “insured person has resumed his or her pre-accident duties”. Therefore, Optimum’s refusal was not premature. The February 10, 2010 letter was a valid termination of benefits and the two year limitation period began to run on this date.

The Plaintiff also argued s. 11 of the SABS which provides for a temporary return to work without affecting the right to resume receiving income replacement benefits if, as a result of the accident, the insured is unable to continue working. The Plaintiff attempted to argue that the claim for benefits only crystalized when the Plaintiff stopped working in February of 2011.

The Court of Appeal followed precedent. The court held the limitation ran from the insurer’s refusal to pay benefits, notwithstanding that the insured had suffered no actual loss in the interim period.


Unfortunately, this is problematic for those trying to return to work, either with deteriorating conditions, work place accommodations that may change, or a multitude of other reasons. It creates a new cost, to all involved, which will be in the form of a dispute with the insurer about entitlement to the benefit, while agreeing that the quantum of the benefit is zero.


Link to decision HERE


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