Indemnification For Legal Costs Awarded When Disability Coverage Denied

In the recent case of Tanious v. The Empire Life Insurance Company, 2017 BCSC 85, the British Columbia Supreme Court awarded special costs equivalent to full indemnification of the plaintiff's litigation costs in a disability insurance action. The plaintiff was initially diagnosed with multiple sclerosis ("MS") in 2002 at the age of 25. Her condition progressed to the point that in 2011, her family physician provided a report stating her medical condition would prevent her from working. The plaintiff was subsequently terminated from her employment. In 2012, the defendant advised her that it had rejected her disability claim and later refused to pay long-term disability benefits.

In the underlying action, the Court concluded that the plaintiff was totally disabled by MS under the terms of her disability insurance policy issued by the defendant and would continue to be disabled in the future. The Court allowed her action for long-term disability benefits and also