As an Ontario personal injury lawyer, I've dedicated my career to advocating for the rights and well-being of accident victims.
Today, I want to shed light on an important aspect of long-term disability (LTD) cases that often goes unnoticed: punitive damages. These damages can be a game-changer in your pursuit of justice and fair compensation.
When individuals face the challenges of long-term disability due to an accident or injury, they often rely on LTD insurance policies to provide financial support during their recovery. While these policies are designed to offer protection, the reality is that insurance companies sometimes engage in unfair practices that can make the process arduous for claimants.
Over the years, I've seen many egregious situations, where insurers simply ignore all of the medical experts and deny from day one and continue to deny, until a lawyer gets involved.
So, what are punitive damages? Punitive damages, also known as exemplary damages, are a distinct category of compensation in LTD cases.
Unlike other types of damages that aim to compensate you for your losses, punitive damages serve a different purpose altogether. They are intended to punish the insurance company for its misconduct and deter similar behaviour in the future. In other words, they are a powerful tool to hold insurance companies accountable for their actions.
Indeed, there is an obvious power imbalance between insurer and insured, and there have been many instances in the past when big insurance takes advantage of this imbalance.
In a short list, here are some reasons why punitive damages matter:
- Deterring Misconduct: Insurance companies are obligated to act in good faith when handling LTD claims. However, some may engage in bad faith practices, such as unjustly denying claims, delaying payments, or engaging in dishonest tactics. Pursuing punitive damages sends a clear message that such behaviour is unacceptable.
- Restoring Justice: Sometimes, punitive damages are the only way to achieve a sense of justice in cases where the insurer's actions were particularly egregious. It ensures that your voice is heard and that the insurer faces consequences for their misconduct.
- Leveling the Playing Field: Insurance companies have vast resources and legal teams at their disposal. Pursuing punitive damages can help level the playing field, allowing you to stand up against powerful corporations and insurers.
To successfully pursue punitive damages in an LTD case, it's crucial to work with an experienced personal injury lawyer who understands the complexities of insurance law in Ontario. Here are some important considerations:
- Evaluating Misconduct: Your lawyer will assess whether the insurance company's actions meet the threshold for punitive damages. This often requires proving that their conduct was malicious, high-handed, or exceptionally reckless.
- Gathering Evidence: Building a strong case for punitive damages involves collecting evidence of the insurer's misconduct. This may include correspondence, internal documents, and witness testimony.
- Legal Expertise: Pursuing punitive damages can be legally intricate. Your lawyer will navigate the legal complexities, ensuring that your case is handled effectively and is aware of the guiding case law.
- Negotiation and Litigation: Your lawyer will engage in negotiations with the insurer to seek a fair settlement that may include an award for punitive damages. If necessary, they will also represent you in court.
In conclusion, punitive damages in LTD cases are a powerful means of achieving justice and holding insurance companies accountable for their actions.
Weeks ago, the Ontario Court of Appeal upheld a massive award of punitive damages against an insurer, in the precedent-setting decision of Baker v. Blue Cross Life Insurance Company of Canada. In this case, the insurer was ordered to pay punitive damages in the amount of $1.5 million.
On appeal, the Court of Appeal observed that punitive damages are a deterrent to future misconduct and that the $1.5 million amount was appropriate in achieving this objective against this insurer.
It is anticipated ongoing and future LTD cases will look to this precedent-setting decision for guidance.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.