In a significant ruling on February 7, 2025, the Ontario Divisional Court reversed a decision of the LicenceAppeal Tribunal (LAT) in Hussein v. Intact Insurance Company 2025 ONSC 842. The LAT had dismissed Mr. Hussain's accident benefitclaim for failure to comply withthe 7-day notice requirement under s. 32(1) of the Statutory Accident Benefits Schedule (SABS).
Overview of Hussein v. Intact Insurance
The Facts of the Case
The facts are straightforward. The appellant, Jakupovic Hussein ("Hussain"), was involved in an accident in which his vehicle was totaled. He notified his insurance company about the accident on February 14, 2019, one day after it occurred. However, he did not submithis application for accident benefits until 16 months later, in December 2020.
Hussein explained that he was unaware of his entitlement to accident benefits until he consulted a paralegal, who informed him of his rights. The insurer denied his claim on the grounds that he did not notify them within the required seven days.
The LAT's Original Decision
Hussein disputed the insurer's denial to the LAT. The LAT concluded that merely reporting the accident to the insurer was insufficient to trigger the insurer's obligation to provide accident benefits. The dismissal was upheld on reconsideration.
The Divisional Court's Ruling
Notice to Insurer is Sufficient
The Divisional Court disagreed and overturned the decision. The Court found that Hussein's notice to the insurer on February 14, 2019, that he had been in an accident was sufficient to meet the 7-day requirement under the SABS.
Insurer's Duty to Investigate Claims
The Court noted that fundamental to its decision was "the fact that the SABSis consumer protection legislation, which must be interpreted in a manner consistent with its objective - to reduce economic dislocation and hardship for victims of motor vehicle accidents."
The Court found that the notice requirement should not be interpreted in such a restrictive manner that it undermines the legislative intent of the SABS. It noted that once the insurer was informed of the accident, it should have assumed that the insured was entitled to accident benefits. It was not the responsibility of the insured to specify their intent to apply for benefits. The Court further statedthat if the insurer had any doubts about the nature of the claim, it had the obligation to make further inquiries, such as asking whether the insured had sustained injuries in the accident. The Court briefly considered s. 34 of the SABS which permitsthe notice period to be extended if an insured person has a reasonable explanation for the delay. It found, however, that the jurisprudence surrounding that provision was unhelpful to the insured.
Impact on Insurers and Consumers
Shifting the Burden to Insurers
In reversing the LAT's decision, the Divisional Court also observedthat insurance contracts are complex, and it is unreasonable to expect the average consumer to be familiar with all aspects of their policy, especially in the aftermath of a traumatic event like a motor vehicle accident. The Court noted that many consumers are vulnerable in the days following an accident and may not fully understand their rights under the insurance policy. It is therefore unreasonable to impose strict notice requirements without considering the difficulties an insured person may face in navigating the claims process.
The Divisional Court's decision in Hussein v. Intact Insurance Companymarks a departure from existing case law on the notice requirement by focusing almost exclusivelyon the consumer protection aspects of the SABS. The ruling reflects a more lenient approach to the notice requirement, which benefits accident victims. It also imposes a positive obligation on insurers to take proactive steps to help claimants to understand their right to make claims under the SABS.
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