When does the time limitation to sue under your long term disability policy expire?
March 14, 2008, Kitchener, Ontario
Posted by: Robert Deutschmann, Personal Injury Lawyer
In all disability or injury claims it is important that you consult with an accident, injury and disability lawyer as soon as possible so that you are aware of your legal rights and also the time within which you can bring your claim. The general rule is that you have 2 years from the date of loss. However, one question to answer is when did the 2 year period commence. It is possible that the 2 year limitation period would start some time after the accident. The 2 year period can commence from when you "discover" the loss, which can occur at some point after the accident. This is a technical legal interpretation that a experienced accident, injury and disability lawyer will be able to review with you.
In a recent court decision (Smith v. Co-operators Insurance), the issue of the insurer´s "appeal" process and the impact on the limitation period was considered by a motion (A motion is a preliminary hearing of an issue prior to a trial). Smith was disabled in March 2001 and began to receive long term disability benefits from Co-operators in June 2001. The long term disability benefits were terminated in December 2003. An action to continue the long term disability benefits was commenced in September 2006.
As long term disability benefits are considered a continuing benefit, a disabled person would be able to sue for benefits for two years prior to the date that the law suit is started. In this case that would be back to September 2004. However, the disabled person´s claim included the period from January 1, 2004 to Septebmer 2004.
The motion was brought by the disabled person for a declaration that he was not statute barred by the Limitations Act to claim disability benefits from January 1, 2004 to September 2004.
The judge noted that a limitation period does not start to run until there has been a clear and unequivocal denial of benefits by the insurer. The judge noted that a discoverability issue usually requires other evidence to be considered by the trial judge. In this motion the judge determined that the letters from the insurer were sufficient to determine the issue. The determination of this motion centres on the correspondence between the insurer and the insured. There was no need to consider any other evidence.
The motino judge, after considering correspondence from the insurer to the insured, found that the letters would have left the impression with the insured that his file was open to reconsideration at any time further information was supplied to him. The letters from the insurer referred to a 30 day appeal period but the letters used the terms "should" instead of "must". The letters were not definitive of a final decision having been made about the insured´s long term disability benefit entitlement. The letters also left the impression that the appeal process would occur whenever additional information was provided. The motion judge determined that Smith was entitled to claim benefits commencing from January 2004.
It is interesting to note that Smith did qualify for CPP Disabilty. Smith was found to have a prolonged and severe disability.
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Deutschmann Law serves South-Western Ontario with offices in Kitchener-Waterloo, Cambridge, Woodstock, Brantford, Stratford and Ayr. The law practice of Robert Deutschmann focuses almost exclusively in personal injury and disability insurance matters. For more information, please visit www.deutschmannlaw.com or call us toll-free at 1-866-414-4878.
The opinions expressed here, while intended to provide useful information, should not be interpreted as legal recommendations or advice.