Important Decision On When Catastrophic Accident Benefits Become Overdue

Case Study: Van Galder v. Economical, 2016 ONCA 804

The Court of Appeal has released a decision placing the onus on an insurer for determining whether a claimant is catastrophically impaired. Specifically, if an insurer withholds catastrophic benefits until it receives an OCF-19, then it could be faced with a massive interest award from the date the catastrophic impairment arose (not the date the OCF-19 was submitted or accepted by the insurer).

In this case, Economical appealed the order of the application judge that required it to pay the applicant interest in the amount of two percent per month, compounded monthly, on attendant care, and housekeeping / home maintenance benefits. The amount of interest ordered payable was approximately $500,000.00 on the additional attendant care and housekeeping benefits of $173,561.99, which were paid to the applicant.