Your Insurer Cut You Off Benefits – What Are Your Options?

March 29 2011 // Articles/Papers

People injured in car crashes depend on their insurance company for benefits to help them recover from their injuries and survive financially until they can return to a normal life. More often than not, while benefits are paid following the crash, injured people get cut off benefits before they have made a full recovery. Consider these typical examples:

1. You have been receiving weekly income replacement benefits for a while when your adjuster tells you that she will terminate this benefit as you no longer qualify. The adjuster refers to a medical report and says the doctor believes you can return to work. Your own doctors tell you that you are not ready to return to work for now.

2. Your physiotherapist tells you that you need to continue with your physiotherapy in order to maintain your current level of function. Without it you will regress. Despite this, your adjuster advises you that physiotherapy will be cut off.

3. An occupational therapist came to your home and recommended a variety of assistive devices and modifications to make it easier for you to look after your home. The insurance company agrees to pay for some, but not all of the recommended items.

When faced with these situations, some people think the adjuster must know what they are doing, and accept the decision. Others are certain the decision must be wrong, but do not know what to do about it, or feel that they do not have the money to fight the insurance company.

In this article I try to give you an idea of what you can and should do when your insurance company cuts you off benefits.

DOES THIS DECISION MAKE SENSE?

Trust your common sense. If the adjuster’s decision seems fair, balanced, and based on all of the available medical information, you may not want to contest it.

If the decision strikes you as unfair, biased, based on limited information or on one medical report only, or simply doesn’t make sense to you, look further into the matter. Ask yourself if a middle ground position makes more sense? Is there something you could live with that might be acceptable to the insurance company? Take the time to discuss your thoughts with your doctors and therapists.

Sometimes a telephone call to the adjuster will clear the matter up. Perhaps you have information that she does not. Perhaps your situation has changed or the original plan no longer makes sense to your therapist and the adjuster just isn’t aware of the change. With a bit of luck, you may be able to straighten matters out.

GET WRITTEN OPINIONS – PROVE YOUR CASE

You need to convince the adjuster that you need the benefit she has denied. For example, in the case of a treatment plan, you have to show that the treatment proposed is reasonable and necessary.

You need to have your family doctor or your treatment provider tell the adjuster, preferably in writing, why the treatment is reasonable and necessary, and that they expect your condition to worsen if you do not get the treatment. Many insurance adjusters will think twice about denying treatment if faced with an opinion that you will get worse without it.

Get the best opinions you can. If you have a specialist, ask him or her for an opinion. You are generally required to obtain approval from your adjuster for the cost of the letter from your doctor before the letter is prepared, if you want the insurance company to pay for the letter.

Make sure your physician understands what is going on. Provide him with all of the letters from the adjuster and their doctors. Send a copy of the letter you get from your doctor to the adjuster. Ask the adjuster to reconsider her decision. Go to the next step if you are still not satisfied.

MEDIATION

If you and your insurance company disagree about your entitlement to or the amount of a benefit, you must first apply for mediation at the Financial Services Commission of Ontario. You can obtain an Application from the Financial Services Commission of Ontario, or sometimes your insurance company will provide one to you. A lawyer practicing in this field will have them available.

Complete the application and attach the letters from your doctors, together with a letter setting out what happened in the crash, your treatment and how you got to this point.

The mediation is usually conducted over the telephone. They can go on for a long time, so make sure you are physically comfortable.

The mediator’s role is to assist you and the insurer to solve the dispute. The mediator will ask questions, and point out the strengths and weaknesses of each case. But she should not push you into settling. That is a decision you should make for yourself.

If you settle with the insurer at the mediation, there will be some paper work to fill out.

Caution: sometimes the insurance company will want to reach a full and final settlement of all your accident benefits. Do not engage in that discussion if you have not had time to consider your life-long needs.

THINK ABOUT GETTING LEGAL ADVICE

When deciding whether to see a lawyer, consider the fact that the insurer will have a college-educated, highly trained and experienced specialist dealing with the claim. Your insurer gets legal advice on interpretations of the law, pays for lawyers to train their adjusters and mediators, to write manuals and guides, to review recent decisions of the court and the Arbitrators, etc.

It is always to the insurance company’s advantage to keep you as uninformed as possible. And that means keeping you away from lawyers.

If you are going to dispute the matter further, you need a lawyer. Lawyers who are experienced in this area will be able to represent you - most will conduct a free initial consultation during which they will discuss fees and how your case will be paid for.

ARBITRATION OR COURT

Should you sue in court, or arbitrate at the Financial Services Commission? There are a number of differences between the two systems as far as the results and procedures are concerned.

  • How long it takes to get to the hearing?
    • In some jurisdictions it is faster to go to court than it is to go to arbitration.
  • How much money does it cost to start?
    • Arbitration is less costly to begin with. However, you may recover less money for court costs in Arbitration than in court.
  • What are the pre-hearing/trial procedures?
    • Court cases require more extensive pre-trial procedures and there is an oral examination under oath of all the parties. Relevant documents must be exchanged in each system. There is a pre-hearing conference in each system, designed to try to settle the case and to determine if the participants are ready to proceed further.
  • What penalties can be assessed at the hearing?
    • At arbitration, the arbitrator can grant what is called a “special award” against the insurer. In court, punitive damages or damages for bad faith can be awarded against the insurer.

CONCLUSION

Although it is a frightening prospect to take on an insurance company, in many cases you should. It is an unfortunate reality that some adjusters are playing the odds. They just cut off benefits in the expectation that many people will accept their decision.

The purpose of this article is to encourage you not to give up. Your best protection is knowledge and information. This article is just a starting point. Other sources of information are the Financial Services Commission of Ontario, its web site, and The Insurance Ombudsman.

Should You Cash Out Your Accident Benefits?

March 29 2011 // Articles/Papers

If you have been involved in a car crash in Ontario, you know how overwhelming it can be to deal with the paper work, phone calls, and additional visits to health professionals. You also know what it’s like to live in constant fear of being cut off benefits, of being watched by surveillance cameras and investigators, or of constantly being called upon to justify your entitlement to benefits. You are tired and fed up and wish to part ways with your insurance company.

What is Cashing Out?

When you cash out, your insurance company pays you a lump sum of money and in exchange, you give up the right to claim any further benefits. Any benefits still ongoing are stopped and the lump sum is usually intended to cover your past, present and future accident-related needs.

Cashing out is a one-time, once-and-for-all payment: you do not get any more money from the insurance company and you do not get to apply for more benefits.

The issue of cashing out can be raised by either party, but it most often comes up in one or some of these situations:

  • You have received benefits for a long time and everyone agrees that you will continue to do so.
  • You are in a dispute with the insurance company and some form of legal process has been started.
  • A significant medical opinion about your level of disability or need has been provided which leads to an evaluation of your future needs and entitlements.
  • The insurance company wishes to close your file to avoid the cost of keeping it open.

When should I consider cashing out?

It is not advisable to consider cashing out unless your prognosis is clear and you can determine what you will need in the future. The best time to talk about settlement is when you are in a position of strength (for example if number 3 above occurs); or if your case is about to go to trial or arbitration.

When should I avoid cashing out?

If you think you just can’t cope with the insurer any more, and just want to get rid of them, you may be too emotional to make rational decisions. This may not be a good time to act.

If your insurer uses threats and tells you that if you do not settle, they will cut you off benefits and send you to their doctors, do not cash out. Get a lawyer because you will need one.

If you are involved in a lawsuit against the at-fault driver, do not cash out your accident benefits without first getting legal advice. Cashing out may seriously prejudice your rights in the action against the at-fault driver.

How is the right number determined?

This can be either a very complicated, or a very straightforward process, depending on your circumstances. A personal injury lawyer with experience in the area of statutory accident benefits will be able to give you good advice about how to approach this process.

Some of the factors that go into the evaluation are:

  • Your prognosis
  • What you have been paid in benefits to date
  • Whether your injuries can be classified as catastrophic or not
  • What is your income benefit payment
  • How old you are and what your life expectancy is
  • Future care plans
  • Actuarial or Structure Annuity quotes on the value of future benefits
  • An assessment of what your legal entitlement to particular benefits may be
  • The costs of fighting with the insurer
  • Factors relating to the lawsuit against third parties if any

What advice should I get?

Given the factors outlined above, it is very clear that you will need:

  • Legal advice: consider that when cashing out accident benefits, you are giving up potential future rights and are negotiating with a highly trained insurance professional with all sorts of resources available to him or her. The imbalance is significant.
  • Medical advice: your health practitioners are key advisors. How can you cash out without some idea of what the medical future holds for you?
  • Investment advice: once the fund is received, you will need to know how to invest it to best ensure your needs are met.

What is the process? Are there any protections for me?

Under the Insurance Act, the insurer must provide you with a package that contains not only the terms upon which you agreed to settle, but also an explanation of the benefits that may be available to you and the approximate value of these benefits. In addition, the law allows you a cooling off period of two business days. You can change your mind about any settlement within that time frame. If you do change your mind and no longer wish to settle with your insurer, you must give notice in writing to the insurer.

If the insurer fails to comply with the Regulation, the settlement may not be considered valid. The Courts have ruled, in one case, that the Regulation does not apply, and that is when you are involved in a lawsuit with an insurer and sign a settlement agreement.

Because of the cooling off period, most insurers will not pay out the settlement until you have signed all the papers, they are returned to the insurer, and the two business days have passed.

Finally, in most cases, the insurance settlement regulations do not permit the settlement of an accident benefits claim until one year after the car crash.

Bachmann Personal Injury Law will be moving!

March 24 2011 // Community Events

Bachmann Personal Injury Law will be moving to a building yet to be built on Queensway East, alongside Harvey's/Swiss Chalet and Remax. The new building will have on-site parking and will be built to accomodate disabled people. We expect construction to begin sometime late spring, early summer!