Post-Accident Income Deductions For Self-Employed Insureds: Is It Better To Earn Than Receive?

In the long-waited appeal decision from the Financial Services Commission of Ontario ("FSCO"), Delegate Evans in Perth v. Surani (FSCO Appeal P16-00022) confirmed that a self-employed insured's post-accident business income is deductible from their income replacement benefits for the purposes of paragraph 7(3)(b) of the Statutory Accident Benefits Schedule – Effective September 1, 2010, O. Reg. 34/10 ("SABS").  Section 7(3)(b) provides that an insurer may deduct from an income replacement benefit: "70% of any income from self-employment earned by the insured person after the accident and during the period in which he or she is eligible to receive an income replacement benefit."

Mrs. Surani was a self-employed pharmacist in a family pharmacy business.  Following her December 12, 2010 accident, she (and her husband) claimed income replacement benefits ("IRBs") from Perth under the SABS.  Pursuant to paragraph 7(3)(b), Perth deducted the pharmacy's post-accident