Canadian Underwriter

Investigating AB Claims

December 1, 2010   by Donna Ford

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Donna Ford, Licensed Private Investigator, Northwood and Associates

Accident benefit (AB) claims adjusters in Ontario can reduce payment of fraudulent claims and also help to fight organized crime. Here are a few tips for investigating these claims.


Generally speaking, get the clinical notes and records of the pre-accident family doctor as quickly as possible. Sections 33 and 53 of the Statutory Accident Benefits Schedule (SABS) — which relate to insurer examinations and the termination of benefits due to material misrepresentation, respectively — are your best friends in a bogus claim.

In a questionable income replacement benefit (IRB) claim, if you telephone the alleged employer, I suggest you ask the following questions:

• Is the claimant working now?

• What was the last day worked? The first day worked?

• Was a payment made by cheque, cash or direct deposit?

• Were pay stubs provided that show deductions for tax or CPP?

• Are there time cards?

• Was the claimant an employee or self-employed contractor? (This question is not asked of the employer on the Employer’s Confirmation of Income.)

• Is the claimant a relative or friend of employer? (Ordering a corporate search before contacting the employer often gives useful information in this regard.)

• What were the pay periods and amounts?

• What was the claimant’s job title and description?

• Was a Notice of Termination issued?

• Was claimant’s name included on WSIB forms? If you visit the employer, I suggest you take a

pre-printed form with you and then you can just fill in the blanks. You will need to get basic information about work dates, benefits, job description and wages. But you will also want to know what percentage of time the employee spent doing essential tasks and sub-tasks of employment, such as sitting, standing, bending over, lifting or carrying. You will want to review the employee file and all payroll and other records. If the employer refuses to sign the completed form, consider sending a letter confirming the information.

I suggest you ask for a Statement of Post Acci- dent Earnings to be completed and signed by the claimant (all requests should be pursuant to Section 33 of the SABS.) If you arrange for surveillance and discover the claimant is working (but the OCF 13 indicates no post-accident income), consider whether or not you have enough evidence to deny the benefit under Section 53 of the SABS. The basis for denial would be that the claimant has willfully misrepresented facts.


Some self-employed claimants try to pass themselves off as employees (usually of a company owned by a relative because they want fast money). They don’t want you to find out where they are actually working, and they don’t want you to see their income tax returns.

If you have any question about the legitimacy of the income claim, then I suggest you set out the discrepancies and issues in a letter or Explanation of Benefits (EOB). Also, ask for income tax returns with enclosures and notices of assessment, copies of the back and front of pay cheques and bank records. You can ask the claimant to explain the discrepancies in a statutory declaration; this is in addition to the statement that you will want to take from the insured covering all of the issues.

Section 4(5) of the Statutory Accident Benefits Schedule (SABS) says you don’t have to consider income on which tax is not being paid. Honest claimants will have no problem providing you with tax returns.


When the Ontario government implemented auto insurance reforms on Sept. 1, 2010, the definition of “incurred expenses” changed. The amended definition of incurred expenses relates to goods and services such as housekeeping, caregiving and attendant care. The new definition says the insurer is required to pay for a claimant’s incurred expenses only if the service provider was rendering the services in the course of his or her regular occupation or, as in the example of family members providing the service, if the service provider sustained an economic loss as a result of providing the goods or services.

The service provider’s name, address and telephone number should appear on their invoices along with details of work done. I suggest you do reverse phone and address searches to find out the name and address of the person to whom the phone is registered. By doing so, you may discover a relative is trying to pass himself off as a professional housekeeper. In addition, do a Google map search to find the distance between the insured’s and the service provider’s homes, as well as the routes by car and public transit. This will give you potential areas of questioning when you do your interviews.

Before conducting an interview with a questionable service provider, I suggest you review the insured’s statement, the bills, assessments and other reports dealing with that issue. Also, find out how much the insurer has already paid for the services of that particular person. In a telephone interview with a questionable provider, you should ask key questions first, since they usually try to brush you off quickly. These questions might include:

• What was the payment agreement?

• What has been paid to date in total? (Ask for an approximation or range if he or she cannot give you an exact figure.)

• How much is now owing to the service provider?

• Is the payment for services made by cheque, cash or direct deposit?

• Does the service provider keep any records of dates worked/times/duties/ payments/balance owing?

If you do a telephone interview with service providers who supply information suggesting the bills are not legitimate, you should ask to meet with them to review their records and take a statement. If they refuse, you can send a confirming letter stating what they told you. Ask for an opportunity to meet to take a statement, particularly if they disagree with the contents of your confirming letter. Depending on the information you have, you could deny the provider claim outright; you could also compile the discrepancies in a letter to the insured and ask the insured to provide a statutory declaration to clarify the issue.

In my experience, I have found many service providers have been paid much less than the insurer has already paid for alleged services, sometimes thousands of dollars less. The extra money is potentially going to the insured or being divvied up between the insureds and their legal representatives. This is fraud.


Insurers can do a number of things to help reduce fraud and fight organized crime.

Interview service providers, both during the claim and after it has closed and payments have been issued. Take note of legal representatives or service providers involved in fraudulent claims and provide this information to the Insurance Bureau of Canada’s investigative service division (IBC-ISD).

The Unfair or Deceptive Acts or Practices regulation deals with the failure to disclose a conflict of interest to the insured and the insurer. Without question, undisclosed conflicts lead to overtreatment and overbilling. They can also be an indicator of staged accidents and organized crime. If you see patterns of association between legal representatives, rehabilitation clinics, assessment companies, body shops and tow truck drivers, I suggest you write to all of them at the beginning of a claim and ask if there is any conflict of interest. Make sure you raise those letters at mediation, arbitration and trial. Also notify IBC-ISD of your letters and any responses.

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