By Alan Shanoff ,Toronto Sun
First posted: Saturday, January 07, 2012 05:27 PM EST
While the insurance industry has loudly proclaimed the pervasiveness of insurance fraud, it has been quietly leading a battle to deny benefits to the most seriously injured car accident victims.
That battle is being waged over the definition of catastrophic impairment.
Accident victims in this category are entitled to enhanced medical and rehabilitation accident benefits of up to $1 million.
As of September 2010, those seriously but not catastrophically impaired are entitled to reimbursement of medical and rehabilitation benefits to a maximum of only $50,000 (although this can be doubled to $100,000 for an additional premium).
Prior to September 2010, the limit was $100,000.
But none of this money goes into the pockets of accident victims; the money is to be used solely for reasonable and necessary expenses.
Robert Kusnierz was injured in a 2001 car accident resulting in significant injuries. His left leg was amputated below the knee.
Due to cysts and deterioration of the stump, he often uses a walker or wheelchair rather than a prosthesis.
He has had 10 different prostheses. Even with them, he can walk well only on flat surfaces.
He suffers from headaches and pain in his shoulders, neck, back, hips, knees and right ankle.
He lost his job and suffers from “severe” psychological symptoms, likely meeting the diagnostic criteria for a major chronic depressive disorder.
Not surprisingly with such significant injuries, Kusnierz exhausted his $100,000 medical and rehabilitation limit as of late 2005.
That’s because prostheses, wheelchairs, assistance devices, attendant care, housekeeping services, medication expenses, home modifications and other costs all come out of the accident benefit limits.
It’s easy to exhaust them, particularly in cases of serious but not catastrophic impairment.
You’d be hard pressed to find many people to argue Kusnierz’s injuries don’t constitute catastrophic impairment.
Even his insurer, The Economical Mutual Insurance Company, agreed if his physical and psychological injuries were combined, Kusnierz would have satisfied the definition of catastrophic impairment.
Didn’t meet definition
But ignoring years of precedent, his insurer argued combining physical injuries with psychological injuries is not permitted in making a catastrophic impairment designation, and neither the physical injuries nor the psychological injuries alone satisfied the definition of catastrophic impairment.
In late 2010, Justice P.D. Lauwers of the Ontario Superior Court accepted that argument, ruling in favour of the insurer.
Kusnierz launched an appeal to the Ontario Court of Appeal.
The Insurance Bureau of Canada (IBC), the national industry association representing Canada’s home, car and business insurers, intervened in the appeal, trying to uphold the pro-insurance decision.
It’s hard to overestimate the parsimonious nature of such conduct since there are very few cases where physical or psychological impairments would not be considered catastrophic when assessed separately, but would be considered catastrophic when combined.
Happily for Kusnierz, the Court of Appeal’s decision, released in late December, reversed the lower court ruling, concluding that allowing physical and psychological injuries to be combined in making a catastrophic impairment assessment “promotes fairness and the objectives of the statutory scheme.”
But the battle isn’t over.
The Ontario government is sitting on a report by a panel of experts to the Financial Services Commission of Ontario. FSCO is responsible for the regulation of car insurance in Ontario.
This report, prepared by a group comprised of eight members, two of whom have been consultants to the IBC and two of whom have received research grants from the insurance industry, argues against combining physical and psychological impairment.
These experts argue there isn’t “sufficient evidence that combined impairment ratings are more clinically meaningful than using separate criteria.”
Try telling that to Robert Kusnierz.