Canadian Underwriter

Claimant can’t resume auto AB payments after 13 months on the job

January 30, 2023   by David Gambrill

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A New Brunswick woman injured in an auto accident is not entitled to resume her accident benefits payments 13 months after returning to work, the province’s top court has ruled.

New Brunswick’s Court of Appeal sided with her auto insurer, Aviva Canada, which denied resumption of her income replacement benefits.

Aviva noted the claimant was medically cleared to return to work after she exhausted her policy limit of 104 weeks of income replacement benefits. After a little over a year of working in pain, doctors ordered her to stop working because she was unable to meet the physical demands of the job.

“An insured is not able to resume work for over a year and subsequently seek a continuation of their Section B [auto accident] benefits,” as Leah M. Good of Cox & Palmer (Halifax) noted in a Mondaq blog post Friday. “They will be found ineligible for continued indemnity benefits pursuant to the [auto insurance] policy.”

The case turned in part on whether or not the injured driver must be “in receipt” of accident benefits before returning to work, in which case she qualified for a limited exemption in the auto policy granted for those who return to work.

For example, if injured drivers are in receipt of auto accident benefits payments (i.e. within the auto policy’s 104-week maximum limit), benefits will discontinued if they return to work. However, if doctors find claimants are medically unfit to continue working within 30 days of returning to work, the claimants are eligible to have their benefits restored.

However, the legal limit in this example would be 30 days, the court ruled. And the injured driver would have to be “in receipt” of benefits when this happens.

“In my opinion, if, at the end of the [maximum] 104-week [benefits] period, an insured is able to pursue employment for which he is reasonably suited, there is no obligation upon the insurer to continue such payments,” the New Brunswick Court of Appeal ruled in December. “If at some later time the injuries from the motor vehicle accident should preclude the insured from continuing in such employment, there is no obligation upon the insurer to recommence the payments….

“While Clause 4 [in the auto insurance policy] is ‘insured friendly,’ in that a period of up to 30 days of an unsuccessful attempt of work resumption does not disentitle the insured to ‘continue’ to receive weekly benefits, it would not be reasonable for an insured to argue the wording of Clause 4 should be ignored and that much longer periods of work resumption, such as 13 months in this case, should not disentitle an insured to have benefits reinstated.”

Joyce MacDonald was injured in an auto accident in February 2011. Before the accident, she was employed as a nurse with the Veterans Unit of the Campbellton Regional Hospital. She had a part-time contract with the hospital but worked full-time hours. Her work was physically demanding.

Her injuries included a fractured sternum, and pain in her left hip, lower back, left knee and neck. She also suffered from post-traumatic stress disorder and later developed anxiety and depression.

After the accident, her treating physicians confirmed she couldn’t perform the essential duties of her job. She qualified for and received the maximum 104 weekly loss-of-income indemnity benefits from Aviva. She recovered while on benefits; in May 2013, she was medically cleared to begin a gradual return-to-work program. She continued to have pain symptoms after she returned to work.

In June 2014, 13 months later, MacDonald was placed off work indefinitely by her family physician. With professional help, she tried to find another occupation, but was unsuccessful. In September 2014, she applied to reinstate her weekly loss-of-income benefits, but Aviva denied the application.

In denying her application to be reinstated, Aviva cited Part II of the auto insurance policy, which states:

“…if, after having received the first 104 such payments, and while still in receipt of them because of continuing inability to perform the essential duties of his/her own occupation or employment, an insured establishes the accident-related injuries prevent him/her from engaging in any occupation or employment for which he/she is reasonably suited by education, training or experience, the insurer is required to continue making the weekly payments for as long as the insured remains unable to perform the essential duties of his/her own occupation.”

The court went on to agree with Aviva that “continuing inability” means that once the 104-week limit is reached, the claimant is still no longer able to return to work, unlike in MacDonald’s situation (she was cleared to return to work after her benefits had reached the limit). And the claimant must still be “in receipt” of benefits.


Feature photo courtesy of Media