On February 11, 2014, the Ontario Court of Appeal decision in Sietzema v. Economical
Insurance1 confirmed the importance of insurers
providing: (i) clear instructions when it comes to limitation
periods, and (ii) an unambiguous notice of refusal to pay a certain
On November 11, 2005, Tanya Sietzema was involved in a motor
vehicle accident. Ms. Sietzema applied to her own insurer for
benefits under the Statutory Accident Benefits Schedule (SABS).
On December 19, 2005, the insurer replied to the application by
sending Ms. Sietzema a form entitled 'Explanation of Benefits
Payable by Insurance Company' (OCF-9). At the bottom of
the page, under the heading, "WARNING: TWO YEAR TIME
LIMIT," the form explained, among other things, that Ms.
Sietzema had two years from the insurer's refusal to pay a
benefit to commence a lawsuit. Furthermore, the OCF-9 indicated
that Ms. Sietzema was eligible for Income Replacement Benefits but
not eligible for Non-Earner Benefits because she was employed at
the time of the accident.
At the time the insurer denied Ms. Sietzma's eligibility for
Non Earner Benefits, it was generally accepted in the insurance
industry that employment at the time of an accident precluded
receipt of Non-Earner Benefits.2 This changed in 2012
when the Ontario Court of Appeal determined in Gladamez v.
Allstate Insurance Company of Canada that a person who was
able to continue working might nevertheless qualify for Non-Earner
Ms. Sietzema ultimately returned to work on February 13, 2006
after consulting with a lawyer. Her insurer terminated her Income
Replacement Benefits shortly afterwards.
Several years after returning to work. Ms. Sietzma re-asserted a
claim for Non-Earner Benefits.
Ms. Sietzema argued that the insurer had misled her concerning
her entitlement to Non-Earner Benefits. The Court disagreed, and
pointed to the fact that she hired a lawyer in 2006 to advise her
of her rights as a result of the accident, including her right to
accident benefits. Her lawyer that was obligated to inform her of
the benefits that she was entitled to and the deadlines for
obtaining those benefits. Ms. Sietzema submitted that she was given
the wrong reason for her ineligibility for Non-Earner Benefits. The
Court, relying on, Turner v. State Farm Mutual Automobile
Insurance Co., held that clear and unequivocal notice given by
the insurer, cancelling the insured's benefits, was sufficient
to trigger the limitation period, notwithstanding that the insurer
gave legally incorrect reasons for cancelling the benefit.
Ms. Sietzema also argued that her insurer breached its duty to
provide her with a written explanation of the benefits available
and to assist her in applying for them. The Court again
disagreed and found that the information package sent to Ms.
Sietzema complied with the SABS and stated the test for Non-Earner
Benefits as it was then understood.
The Court ultimately dismissed Ms. Sietzema's claim holding
that the OCF-9 sent to Ms. Sietzema clearly: (i) stated that she
was not eligible for Non-Earner Benefits, and (ii) gave notice of
Ms. Sietzema's rights to litigation and the two year limitation
period. The limitation period began to run when Ms. Sietzema's
claim for Non-Earner Benefits was refused. The Court also
stated that there is nothing in the Insurance Act or SABS that
required an insurer, on termination of benefits, to give the
claimant a further notice advising that he or she may have a right
to renew a claim for a benefit that had previously been
1 2014 ONCA 1111 [Sietzema]
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In an October 3, 2016 preliminary issue hearing Adjudicator Marzinotto of the License Appeal Tribunal allowed an applicant to proceed to a hearing disputing both entitlement to Income Replacement Benefits and Non Earner Benefits.
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