Claims Canada June/July 2012

www.claimscanada.ca

June/July 2012

Auto Reforms Did They Perform?

Official Journal of the Canadian Indeépendent Adjusters’ Association

A BUSINESS INFORMATION GROUP PUBLICATION Publications Mail Sales Agreement #40069240

p1 CLAIMS COVER Jun/July2012.indd 1

27/06/12 11:01 AM

GK_Ad_ClaimsCanada.pdf

1

11-11-03

2:51 PM

Exceptional expertise

• Forensic Engineering • Loss Mitigation / Remediation • Engineering Risk Management

416.368.1700 giffinkoerth.com

ad size.indd 22

12/04/12 9:21 AM

Contents J U N E / J U LY 2 0 1 2 • V O L U M E 6 • N U M B E R

12

3

Cover Feature 12 Auto Reforms – Did They Perform?

Key provinces across Canada have fundamentally altered their auto insurance systems with the twin goals of achieving rate stability and predictability in claims costs. The big question, which was addressed at this year’s CIAA/CICMA annual joint conference in February, is – did these reforms meet their purpose?

BY CRAIG HARRIS

Spotlight 18 Northern Lights SCS Insurance Adjusters Ltd. is a family-run adjusting firm with long roots in northern Ontario and deep pride in being independently owned and operated.

BY CRAIG HARRIS

26

Education Forum 40 Cell Phones and the CGL Policy What are some of the insurance issues triggered by claims related to the electromagnetic fields (EMF) emitted by cell phones?

News Features 20 Wildfires in Canada Members of the Slave Lake Wildfire Review Committee put their recommendations in context.

BY PETER FUGLEM & BRIAN STOCKS

38

24 Uncovering Catastrophic Risks While Canada has been fortunate to avoid large-scale economic destruction from natural disasters, there is still significant exposure risk.

BY PAUL THENHAUS

26 Controlling Environmental Remediation Costs Several key factors contribute to the complexity of an environmental claim – knowing them can help adjusters and insurers keep expenses under control.

BY KEITH STEPHEN

30 Cross-Border Tort Cases The Supreme Court of Canada has made changes to jurisdictional issues and the handling of non-resident defendant cases.

Departments 4 First Notice 42 On The Scene

BY KEN MACDONALD

Columns

34 The Anatomy of a Claim

10 President’s Message

A major fire at a meat processing plant tested the response and claims service of one major insurer – and its partners.

40 Education Forum

BY DONNA INCE

38 Avoiding the Ambush Insurance companies facing a “trial by ambush” approach to accident benefits claims can pursue a different strategy.

BY CAROLINE L. MEYER

p3 contents.indd 1

27/06/12 11:07 AM

• first notice FN

Dog bites insurer Dog bites in the three Canadian provinces in which State Farm operates chewed up slightly more than $1 million in claims costs last year.

In 2011, State Farm paid out $917,670 for 25 claims in Ontario, $99,800 for the two claims in Alberta and there were no dog bite claims reported in New Brunswick. The company reported its dog bite claims in May 2012, in advance of Dog Bite Prevention Week, which runs from May 20 to 26.

Ontario’s 2011 total was approximately 39% higher than the $659,786 paid out for 19 claims in 2010. Overall, the highest claims toll was in 2007, when the insurer paid out almost $1.2 million for these sorts of claims.

Almost 3,800 dog bite claims across North America in 2011 prompted claims costs that topped $109 million. State Farm cites estimates from the Insurance Information Institute (I.I.I.) that U.S. insurers south of the border paid almost $479 million in dog bite claims, representing more than one-third of all homeowners insurance liability claims payments. ●

4

Claims Canada

p4,6,8 FIRST NOTICE.indd 4

June/July 2012

Severe rainfall causes flooding in Montreal, Thunder Bay Environment Canada reports the rains that flooded Montreal and overwhelmed the city’s sewer system on May 29 had a return period of 1 in 100 years. Close to 47 mm of rain in total fell during a storm that caused widespread flooding of home basements, highways, businesses, streets and subway stations. Of that amount, 44.5 mm of rain fell in a twohour period and 30 mm fell in less than 15 minutes.

“No sewer collector network would have been able to manage the quantity of water that we saw yesterday,” Montreal mayor Gerald Tremblay told a news conference, as reported by CBC News.

Crawford & Company (Canada) Inc.’s adjusters in Quebec and New Brunswick, along with the company’s national CAT team, are currently assisting with the surge of claims resulting from this event.

“Our adjusters are equipped with the experience necessary to act quickly during times such as this,” said John Sharoun, CEO of Crawford & Company (Canada) Inc. “Our contact centre has received hundreds of calls since the storm began and we are well positioned

to deliver services to the affected areas.”

Meanwhile, Thunder Bay declared a state of emergency after a rainstorm on May 26-27 unleashed 91 mm on the city in 18 hours, flooding the city’s sewage treatment facility. Seventy-one millimetres fell in the city over a little less than six hours, noted André Cantin, a spokesman for Environment Canada.

A Thunder Bay flood update on May 30 said a special council meeting has been requested to approve a resolution directing the city manager to take all necessary actions to secure financial assistance for city flood victims.

“Discussions are ongoing with the provincial and federal governments and the resolution is required to proceed further with formal requests,” the update says.

Insurance Bureau of Canada (IBC) deployed its Community Assistance Mobile Pavillion (CAMP) to Thunder Bay after the city was swamped by 91 mm of rain in just 18 hours. CAMP is a national program that provides disaster victims with onsite, quick-response, insurancerelated information. l

FSCO cracks down on fraud Five rehabilitation clinics and 10 individuals face charges from the Financial Services Commission of Ontario (FSCO) under the provincial Insurance Act. The clinics, all located in the Greater Toronto Area, were charged with one count each of knowingly making a false or misleading statement to an auto insurer to obtain payment for goods or services and engaging in an unfair or deceptive act or practice.

FSCO identified the clinics as: • Professional Medexam Management Inc. (Maple); • Assessment Direct Inc. (Toronto); • Century Diagnostics Inc. (Toronto); • Evident Diagnostics Inc. (Richmond Hill); and • Supermed Rehabilitation Centre Inc. (Woodbridge).

The individuals charged were Mark Zinger, Yan Krivoruk, Alex Smolar, Paul Benchetrit, Pavlo Tsysar, Ivan Terziev, Vladimir Naidenov, Alla Pechenik, Eugene Gurevich and Valeri Znamenski.

The clinics and individuals received summons from FSCO on May 24 to appear in the Ontario Court of Justice.

In other fraud news, a man personally involved in more than 12 staged auto collisions received a three-and-a-halfyear prison term and a freestanding restitution order for $375,000 for his participation in a staged collision ring.

Uthayakanthan Thirunavukkarasu, also known as Max or Mano, entered a guilty plea to instructing the commission of offences for a criminal organization, proceeds of crime, criminal negligence causing bodily harm and fraud charges in connection with a staged collision ring, known as Project 92, across the Greater Toronto Area.

Project 92 uncovered 50 staged collisions. Insurance Bureau of Canada estimates insurance exposure to be as high as $25 million. To date, with the support of two dedicated prosecutors, nearly 300 criminal charges have been laid and 22 individuals convicted. l

www.claimscanada.ca

27/06/12 11:17 AM

Every file is different

From city to city, shore to shore – no two insurance claims and litigation files are ever the same.

In addition to natural case differences, regional rules and nuances often come to bear and shape outcomes.

ARC Group Canada is a national network of independent law firms providing legal and risk-related services to Canada’s insurance and risk management communities. Each member firm within ARC Group intimately understands and is connected with its local market – providing you with national expertise at a regional level.

Alexander Holburn Beaudin & Lang LLP Barry Spalding Burchells LLP Gasco Goodhue St-Germain LLP Hughes Amys LLP McLennan Ross LLP Martin Whalen Hennebury Stamp Robertson Stromberg Pedersen LLP European and International Affiliation: ARC Group Canada is proud to be formally associated with Insuralex Global Insurance Lawyers Group an international affiliation of independent law firms whose members provide high quality legal and risk related services to clients throughout and beyond Europe.

Telephone: 416-581-8082

Toll-Free: 1-866-981-8082

thearcgroup.ca

ARC GROUP NEW AD.indd 1

14/06/11 4:39 PM

ad size.indd 22

17/04/12 3:27 PM

• first notice FN Summary judgment not applied in Ontario CAT impairment case The Ontario Superior Court has derailed a plaintiff’s bid to obtain under new provincial rules for summary judgment a declaration that she suffered a “catastrophic impairment.”

Nancy Stewart was severely injured in a motor vehicle accident on Nov. 4, 2005. The plaintiff was insured by State Farm and applied for no-fault benefits under the Statutory Accident Benefits Schedule (SABS).

State Farm agreed Stewart was entitled to some benefits and paid her more than $281,000 as of Feb. 29, 2012. But the insurer argued that Stewart had not established she had suffered a “catastrophic impairment”, and as such, was not entitled to enhanced medical-rehabilitation benefits of as much as $1 million.

Based on Ontario’s new rules for summary judgment, Stewart argued the

court had sufficient evidence before it to find a “catastrophic impairment” on a balance of probabilities. Therefore, she submitted, there was no genuine issue requiring a trial to determine “catastrophic impairment.”

State Farm responded there was insufficient evidence on the summary judgment motion for the court to make a finding on “catastrophic impairment.”

In support of its submission, State Farm noted the findings of a September 2008 assessment could not be relied upon and additional tests, including a psychiatric examination the plaintiff had refused to attend, had been ordered.

The plaintiff responded this test request was invalid, because it had not been made within 30 days or in writing, as required under the SABS. In its decision, the Ontario Superior Court observed the province’s recently

amended rules for summary judgment now say the court shall grant summary judgment if it is satisfied “there is no genuine issue requiring a trial with respect to a claim or defence.”

In Combined Air Mechanical Services Inc. v. Flesch, the Ontario Court of Appeal in 2011 established a “full appreciation test” to determine whether or not there is no genuine issue requiring a trial. In essence, the court requires a trial if it cannot achieve a full appreciation of the evidence and issues before it on the summary judgment motion.

“In the case at bar, expert evidence will be critical in determining whether or not Ms. Stewart is ‘catastrophically impaired,’” the court wrote in its decision. “The motion record presented by the plaintiff in this case, even if supplemented by hearing some oral evidence on discreet issues, would not enable me to achieve the ‘full appreciation’ of the evidence and issues required to make a dispositive finding of ‘catastrophic impairment.’” l

B.C. court allows limited access to Facebook for auto-related injury The B.C. Supreme Court has ordered a law school graduate student injured in a car accident to disclose Facebook and vacation photos showing her participating in physical activities.

The plaintiff in the case, Tamara Fric, is claiming for damages resulting from injuries suffered in a motor vehicle accident on November 18, 2008. At the time of the accident, Fric was a first year law student at the University of Victoria.

In her Notice of Civil Claim, which contains allegations not yet proven in court, Fric says the accident caused chronic severe headaches, upper back pain and neck pain.

On the basis of these injuries, her claim states, she has “suffered loss and damage, including pain and suffering, loss of the amenities of life, past and future loss of earning capacity and opportunity and past loss of income, loss of educational advancement, past and future loss of domestic maintenance capacity and loss of mobility.”

6

Claims Canada

p4,6,8 FIRST NOTICE.indd 6

June/July 2012

In examination for discovery, Fric testified that in December 2008 she participated in a social and sports tournament with her law school colleagues, known as the “Law Games,” but her participation was limited due to her injuries.

She also disclosed she has a Facebook website that she has maintained since before the accident.

She has posted photographs to Facebook, such as those of her participation in Law Games.

She also testified she has approximately 12,000 photographs, 759 of which were stored on her Facebook profile. They included pictures taken during her travel to Thailand, Fiji, Australia, Montana, Florida, California, Seattle, Portland and Cuba.

Counsel for the defendants in the case asked for a complete copy of the Facebook website, all photographs in her possession taken since 2008 and metadata associated with any digital photographs in her possession or control.

The B.C. Supreme Court said the defendant’s request was too broad and amounted to the “search of the filing cabinet” frowned upon in Desgagne v. Yuen.

Instead, the court ordered her to produce an amended list of documents that identifies the photographs and video in her possession and control in which in which she is featured: 1) participating in the December 2008 Law Games; and 2) on a vacation taken since Nov. 18, 2008. l

www.claimscanada.ca

27/06/12 11:19 AM

Property Damage Cost Control Consultants Providing Innovative Solutions to Control Property Claim Costs

National Coverage • Expertise • Consistency • Results DETAILED VALUATIONS LARGE LOSS SPECIALISTS LIABILITY SPECIFICATION & ACTUAL CASH VALUE (ACV) VALUATIONS INSURANCE TO VALUE APPRAISALS SPECIFICATION AND BID DOCUMENTS PROJECT CONSULTING & REVIEW CATASTROPHE VALUATION PROGRAMS CONFLICT RESOLUTION FILE AUDITS & REVIEWS APPRAISALS UNDER THE INSURANCE ACT Contact us today to further discover why we are acknowledged as Canada’s leading, independent property loss valuation and cost control professionals!

TOLL FREE: 1-877-907-7327 ext. 25 • eMail: info@specs.ca • www.specs.ca SPECS-MC7643-CC FINAL!1.indd 1 Untitled-1 1

17/02/11 11:33 AM 04/04/12 3:38 PM

• first notice FN IBC research illustrates climate change effects by 2050 Canada can expect to see warmer temperatures in the summer months by 2050, leading to an increase in wildfires, drought, water scarcity, lightning flash density and the risk of hailstorms. Parts of the country will see more intense winter storms, more freezing rain and precipitation, as well as a significant decline in sea ice cover and increased coastal erosion.

These are some of the findings of a research report released June 4, entitled Telling the Weather Story: Can Canada Manage the Storms Ahead? The research was commissioned by Insurance Bureau of Canada (IBC) and conducted by Professor Gordon McBean, a renowned climate scientist from the University of Western Ontario and the Institute for Catastrophic Loss Reduction (ICLR).

“Both the historical and projected trends shown in the research point to the need for Canada to adapt now in order to minimize social and economic costs in the future,” McBean says.

Catastrophic events cost Canadian insurers roughly $1.7 billion in 2011, up significantly from almost $1 billion in each of the two previous years. The majority of these insured losses were caused by extreme weather events, but smaller weather events also played a role in significant property damage for consumers.

McBean’s report projects Canadian climate patterns to 2050. It contains the following regional summaries: • Atlantic Canada is likely to see an increase in hurricane and storm activity in the region by 2050, with resulting storm surges.

Freezing rain events will likely increase by 50% in Newfoundland and by about 20% in Nova Scotia.

• Quebec should see more hot days. For Quebec City, trends point to three times as many days over 30 C than during the period from 1961 to 1990. Montreal is expected to see a 60% increase in hot days by 2050. Heavier precipitation and more freezing rain

Paul Aquino Publisher (416) 510-6788 paul@canadianunderwriter.ca

Steve Wilson Senior Publisher (416) 510-6800 steve@canadianunderwriter.ca

Christine Giovis Advertising Sales Representative (416) 510-5114 christine@canadianunderwriter.ca

Craig Harris Editor (905) 873-7691 craig@editinsight.com

Phyllis Wright Print Production Manager

Mike Wells Account Manager (416) 510-5122 mike@canadianunderwriter.ca

Michael Chimienti Art Director mchimienti@bizinfogroup.ca

Subscription inquiries (416) 442-5600 • 1-800-668-2374 (416)Indeépendent 442-2191 Official JournalFax: of the Canadian Adjusters’ Association

www.claimscanada.ca Produced by the publishers of Canadian Underwriter magazine

A bi-monthly magazine (6x per year), Claims Canada is published by BIG Magazines LP, a div. of Glacier BIG Holdings Company Ltd. Business Information Group is located at: 80 Valleybrook Drive, Toronto, ON, M3B 2S9.

Claims Canada magazine is the Official Publication of the Canadian Independent Adjusters’ Association [CIAA] and through its editorial content and circulation brings together the ‘entire property & casualty insurance claims market nationally’ with information and insight into the profession, business and people of insurance claims and loss adjusting.

All key claims process stakeholders are reached as part of our readership community – including: both CIAA member and non-member independent claims adjusting firms; insurance and reinsurance company executive, claims management

8

events of longer than six hours are probable. Increased forest fire frequency is projected.

• Ontario can expect summertime warming, with average temperatures likely to increase by between 2 C and 3 C. Toronto could see significantly more 30 C-plus days in summer. Frost-free days in winter in Ontario are expected to double by 2050. Research also projects heavier precipitation, more freezing rain and more frequent flash flooding. More wildfires are projected in the northwest.

• Manitoba and Saskatchewan will likely see the greatest temperature increases in winter and spring in the south, with increases of between 3 C and 4 C. Drought and water scarcity are likely to be a growing climate risk throughout the prairies. More extreme precipitation events and flooding are expected.

• Alberta will probably be hard hit by drought and water scarcity as a result of decreases in summer precipitation, falling lake levels, retreating glacier, decreasing soil-water content and a greater number of dry years. There is likely to be more hail, storms and wildfires. Lightning flash density could increase by 20 %, producing more wildfires. Heavy rainfall events could cause flash flooding.

Events happening once every 20 years will occur every 10 years.

• British Columbia weather will be variable, but overall projections show warmer and wetter weather. The mountain snowpack is expected to decline. It is possible that wildfires could increase significantly in the province’s forests by 50% to 2050.

• In The North, the likelihood of the temperature in Iqaluit exceeding 25 C in 2050 could be five times greater than during the 1980s. There is an overall projected increase in temperature by 2 C to 4 C in the north. The fire season in the Yukon and Northwest Territories will likely increase by 10 days, increasing the frequency of evacuations and the risk of property destruction. l

Claims Canada

p4,6,8 FIRST NOTICE.indd 8

June/July 2012

Gary White Production Manager (416) 510-6760

and claims adjusting personnel; corporate risk managers and loss control professionals; insurance brokers; insurance law firms; forensic engineers and accountants; appraisal, restoration, rehabilitation and collision repair professionals; Insurance Institute chapters; insurance associations, regulators and related claims market recipients.

The contents of this publication may not be reproduced or transmitted in any form, either in part or in full, without the written consent of the copyright owner. Nor may any part of this publication be stored in a retrieval system of any nature without prior written consent.

www.claimscanada.ca

27/06/12 11:20 AM

ad right size.indd 1

19/06/12 11:54 AM

Message from the President La Plume du Président GREG MERRITHEW

Spring has come and gone. Winter did not seem to happen in much of Canada this year. We, in the Northwest Territories on the other hand, can attest once again to a full cold winter! The lack of weather in most parts of Canada certainly had an impact on the claims volume in many regions. Fortunately, CIAA assisted many member companies through acquisition of EMO work in regions of Canada that experienced slower than expected P&C claims volume.

In February, I had the pleasure of joining our friends and colleagues from L’Association des experts en sinistre indépendants du Québec (AESIQ) for their annual sugar shack in St. Eustache, Quebec. AESIQ President, Elaine Savard and her executive team were especially gracious in hosting me at the event. There was, as always, a very large turnout to a well-planned and delightful event. Well done!

In April, I was pleased to join CIAA Pacific region for their annual CICMA/CIAA joint luncheon. I enjoyed the opportunity to meet many CIAA members and Claims Managers from the Province and discuss the current challenges faced by Independent Adjusters (IA’s) and Claims Managers in the region.

As reported in my last message, CIAA, Canadian Defence Lawyers (CDL) and Canadian Insurance Claims Managers Association (CICMA) have teamed up to deliver their respective memberships with valuable education seminars. The first seminar was held in Vancouver on April 11th and was very well attended.

Several topical issues of the day in our profession were discussed. The seminars also provide continuing education (CE) credits, assisting members in meeting the continuing education component as part of their licensing requirements.

Congratulations to CIAA Ontario and Nova Scotia Regions for their efforts in hosting timely education sessions in their respective jurisdictions on May 11th.

Both events received positive industry feedback and were very well attended.

Our Education Committee, chaired by Santo Carbone, has completed the work necessary to begin the roll out of on-line courses being offered through CIAA’s website. The courses are all claims specific and 10 Claims Canada

p10,11 presidents message.indd 10

June/July 2012

Le printemps est venu et reparti. Cette année, l’hiver n’a pas été trop rigoureux dans la plupart des régions du Canada.

Nous, les habitants des Territoires du Nord-Ouest, pouvons au contraire attester une fois de plus avoir vécu un hiver rude.

Les conditions météorologiques favorables dans la plupart des régions canadiennes ont certainement eu un impact sur le volume des demandes d’indemnité de nombreuses régions.

Heureusement, l’ACEI a assisté bon nombre d’entreprises membres par l’acquisition de travail de l’OMU dans les régions canadiennes ayant constaté un volume plus faible que prévu de demandes d’indemnité en assurance dommages.

En février, j’ai eu le plaisir de me joindre à nos amis et collègues de l’Association des experts en sinistre indépendants du Québec (AESIQ) à l’occasion de leur sortie annuelle à la cabane à sucre, qui s’est tenue à Saint-Eustache, au Québec.

La présidente de l’AESIQ, Elaine Savard, et son équipe de direction ont été pour moi des hôtes attentionnés. Comme pour tous les événements bien organisés et plaisants, le taux de participation était élevé. Félicitations!

En avril, je suis allé rejoindre l’équipe de la région du Pacifique de l’ACEI en vue de prendre part au déjeuner commun de l’ACDSA et de l’ACEI. J’ai été ravi de cette occasion de rencontrer un grand nombre de membres de l’ACEI et de directeurs des sinistres de la province, ainsi que de pouvoir discuter des enjeux actuels auxquels font face les experts en sinistres et les directeurs des sinistres de la région.

Comme mentionné dans mon dernier message, l’ACEI, l’Association canadienne des avocats de la défense et l’Association canadienne des directeurs de sinistres d’assurance (ACDSA) se sont unies pour offrir à leurs membres respectifs d’intéressants colloques éducatifs. Le premier colloque, qui a eu lieu à Vancouver le 11 avril dernier, a rassemblé beaucoup de participants et a abordé des sujets d’actualité liés à notre profession. Les colloques offrent également des crédits d’éducation permanente, aidant les membres à obtenir le nombre nécessaire pour conserver leur licence.

Félicitations aux équipes de l’ACEI des régions de l’Ontario et de la Nouvelle-Écosse pour les efforts déployés relativement à l’animation des séances éducatives opportunes dans leurs juridictions respectives le 11 mai. Les deux événements, très courus, ont reçu des commentaires favorables de l’industrie.

Notre Comité de l’éducation, présidé par Santo Carbone, a terminé le travail nécessaire pour commencer la mise en œuvre de cours en ligne, offerts par l’intermédiaire du site Web de l’ACEI. Tous les cours portent sur les demandes d’indemniwww.claimscanada.ca

27/06/12 11:28 AM

prequalified for CE credits in all jurisdictions requiring continuing education by IA’s. We are very excited to begin providing CIAA members with valuable training that is accessible and affordable.

The development of the new CLA designation program is on track and will be presented to members by the end of the year.

We have two new members on the CIAA National Executive Committee. Welcome to Russ Fitzgerald of Kernaghan Adjusters, Edmonton, who is the new Regional President of Western Region. Also, welcome to Georgiana Chen, of ProFormance Group, Pickering, our new Membership & Qualifications Committee Chair. Serving on CIAA’s board, committees and regional executives is rewarding work with subtle benefits such as networking as well as being in the loop on national issues of importance to our profession. I encourage all members to get involved at either the regional or national level. It is definitely worth the effort.

Remember, be safe out there. Take care of your health and your families. Remember what is important to you. n

té et sont préqualifiés pour l’obtention de crédits d’éducation permanente dans toutes les juridictions exigeant une formation continue des experts en sinistres. Nous sommes vraiment heureux de commencer à offrir aux membres de l’ACEI une formation de grande valeur à la fois accessible et abordable.

Le développement du nouveau programme de désignation des experts en sinistre est en cours et sera présenté aux membres d’ici la fin de l’année.

Deux nouveaux membres siègent dorénavant au Comité de direction national de l’ACEI. Souhaitons la bienvenue à Russ Fitzgerald, de Kernaghan Adjusters, à Edmonton, qui est le nouveau président régional de la région de l’Ouest. De plus, accueillons Georgiana Chen, du ProFormance Group, de Pickering, qui est la nouvelle présidente du Comité de recrutement et de qualifications. Siéger au conseil, aux comités et aux comités exécutifs régionaux de l’ACEI est un travail gratifiant aux avantages subtils comme bénéficier d’un réseau et être au courant des problèmes nationaux d’importance pour notre profession. J’encourage tous les membres à participer, que ce soit au niveau régional ou national. Cela en vaut vraiment la peine.

N’oubliez pas : soyez prudents sur les routes. Prenez soin de vous et de vos familles. Rappelez-vous ce qui est important pour vous. n Translation provided by Henry Arcache, Themis Translations, Montreal, Que.

NATIONAL EXECUTIVE 2011-2012 2011-2011 PRESIDENT Greg G. Merrithew, CIP, FIFAA Arctic West Adjusters Ltd. 401 – 5204 – 50 Ave. Yellowknife, NT X1A 1E2 Phone: (867) 920-2212 • Fax: (867) 873-2244 E-mail: gregm@arcticwest.ca 1ST VICE-PRESIDENT Delores Thorbourne, BA, FCIP, CRM Granite Claims Solutions Suite 103 Greystone VII 4208 - 97 Street Edmonton, AB T6E 5Z9 Phone: (780) 442-3077 • Fax: (780) 466-0325 E-mail: delores.thorbourne@graniteclaims.com 2ND VICE-PRESIDENT John D. Seyler, AIIC ProFormance Group Inc. 5080 Timberlea Blvd., Suite 214 Mississauga, ON L4W 4M2 Phone: (905) 238-4985 • Fax: (905) 238-2735 E-mail: jseyler@prospecialty.ca SECRETARY Marie C. Gallagher, FCIP, CRM Granite Claims Solutions 71 King Street, Suite 204 St. Catharines, ON L2R 3H7 Phone: (905) 984-8282 • Fax: (905) 984-8290 E-mail: marie.gallagher@graniteclaims.com

www.claimscanada.ca

p10,11 presidents message.indd 11

TREASURER Randy P. LaBrash, CIP, CFE, CFEI Crawford & Company (Canada) Inc. 300 – 191 Lombard Avenue Winnipeg, MB R3B 0X1 Phone: (204) 947-2340 Fax: (204) 943-9168 E-mail: Randy.Labrash@crawco.ca

DIRECTOR James B. Eso, BA, CIP Crawford & Company (Canada) Inc. 539 Riverbend Drive Kitchener, ON N2K 3S3 Phone: (519) 578-5540 Fax: (519) 578-2868 E-mail: Jim.Eso@crawco.ca

PAST-PRESIDENT Mary Charman, CIP Crawford & Company (Canada) Inc. 1 – 120 Mulock Drive Newmarket, ON L3Y 7C5 Phone: (905) 898-0008 Fax: (905) 898-1705 E-mail: Mary.Charman@crawco.ca

DIRECTOR John Jones, BA Granite Claims Solutions Suite 300, 5915 Airport Road Mississauga, ON L4V 1T1 Phone: (905) 671-3164 Fax: (905) 671-1889 E-mail: john.jones@graniteclaims.com

EXECUTIVE DIRECTOR Patricia M. Battle Canadian Independent Adjusters’ Association/L’Association Canadienne des Experts Indépendants Centennial Centre, 5401 Eglinton Avenue West, Suite 100 Etobicoke, ON M9C 5K6 Phone: (416) 621-6222 Toll Free: 1-877-255-5589 Fax: (416) 621-7776 E-mail: pbattle@ciaa-adjusters.ca

DIRECTOR Craig J. Walker, CIP, FCIAA, FIFAA Maltman Group International 3550 Victoria Park Ave., Suite 301 Toronto, ON M2H 2N5 Phone: (416) 492-4411 Fax: (416) 492-5657 E-mail: cwalker@maltmans.com

June/July 2012

Claims Canada 11

27/06/12 11:28 AM

CS

• cover story

Auto Reforms Did They Perform?

Key provinces across Canada have fundamentally altered their auto insurance systems with the twin goals of achieving rate stability and predictability in claims costs. The big question, which was addressed at this year’s CIAA/CICMA annual joint conference in February, is – did these reforms meet their purpose? It’s a simple question, with complex answers for independent adjusters and claims professionals.

BY CRAIG HARRIS

S

ince 2003, auto insurance products in several regions of Canada have been transformed.

Driven by substantive reforms at the government level, these changes have answered some critical questions when it comes to how injuries are to be treated and how claims should be handled.

But the reform process also led to grey areas – and, in some cases, simply created new questions. As is often the case, especially in Ontario’s frustrating struggles with auto insurance, attempts to clarify one element of coverage or benefits result in unintended consequences elsewhere.

Alterations to auto insurance in Ontario in September 2010 and amendments to Nova Scotia’s product in April 2012 (with future changes slated for April 2013) represent yet more stages of reform. These topdown modifications by provincial governments require adjusters and claims professionals to sort through

12 Claims Canada

p12-17 COVER STORY.indd 12

June/July 2012

the details in actual loss situations on the front lines of client service.

As Fred Plant, president of Plant Hope Adjusters, noted at the CIAA/ CICMA annual joint conference held in February: “They (politicians) come up with these ideas about what (auto insurance) should look like, throw it out there and leave it to us to figure out how it should work.”

The million-dollar question posed at this meeting was, “Did the reforms perform?” Unfortunately, the answer is a less than satisfying, “it depends.”

Specifically, which region and what yardstick are you measuring – rate stability or claims cost control? The annual meeting examined the experience in four key provinces that have been at the centre of the reform process – Alberta, New Brunswick, Nova Scotia and Ontario.

For example, when it comes to premium stability, provinces such as New Brunswick and Nova Scotia have fared well since major reforms, such as

minor injury caps, were introduced in 2003. The average cost of auto insurance in New Brunswick has declined by 34% since the minor injury cap was introduced in 2003, with current average premium of $813, according to Insurance Bureau of Canada (IBC).

Premiums have remained remarkably stable in Nova Scotia, with yearly average premiums dropping by 25% from 2003–2011.

Alberta’s average premium at just over $1,000 has also held steady. Ontario experienced the biggest premium swings in the past few years, with average premium currently at $1,534.

“Auto insurance rates in Ontario are too high,” noted IBC vice president, Ontario region Ralph Palumbo in a May 2012 submission to a provincial government committee. “While four years ago, Ontario premiums were on average 25% higher than the next highest province – Alberta – today the average Ontario premium is now more than 45% higher than Alberta’s

www.claimscanada.ca

27/06/12 11:31 AM

and almost twice as high as premiums in the Maritime provinces.”

What about loss experience?

Again, Ontario is facing steep challenges when it comes to reining in “out of control” claims costs, according to Palumbo. The average accident benefits claim in the province is just over $56,000, more than four times that of New Brunswick ($12,698) and roughly nine times that of Nova Scotia ($6,371). There is a long list of culprits driving up expenses in Ontario – a huge mediation backlog at the Financial Services Commission of Ontario (FSCO), an increasing number of catastrophic injury claims (coupled with a long-awaited definition of catastrophic impairment) and an alarming rise in tort claims.

Yet other provinces also face latent claims cost bubbles, many of which may come to the surface in the months and years ahead. Nova Scotia’s introduction of an optional endorsement to purchase tort coverage in April 2013, along with a substantial bump up in the minor injury cap, could release the genie on injury loss costs. Alberta, which like the Atlantic provinces has seen constitutional challenges to its Minor Injury Regulation (MIR), may bear the brunt of increased judicial scrutiny on whether the MIR is too vague for meaningful application.

Various presenters at the CIAA/ CICMA joint conference explored each of these province’s experiences with auto insurance reforms. Fred Plant discussed New Brunswick and Nova Scotia, while Sandra Corbett, a partner with Field Law, examined auto insurance changes in Alberta.

A panel of speakers on Ontario auto insurance reform – Becky Cameron, AVP, health care services, Aviva Canada; Dennis Giesbrecht, clinical intake manager, Lifemark Health Centre; Tammie Norn, CEO, ProFormance Group Inc; and Philippa Samworth, partner at Dutton Brock – was moderated by Eric Grossman, founding partner of Zarek Taylor Grossman Hanrahan. For this article, we will start with Eastern Canada and head West.

www.claimscanada.ca

p12-17 COVER STORY.indd 13

New Brunswick The key issues before New Brunswick’s provincial Progressive Conservative government are two recommendations from an auto insurance working group, which were released in November 2011.

Specifically, the working group stated that the current definition of “minor personal injury” in regulations should be replaced with a new definition: “A minor personal injury is a sprain or strain or whiplash-associated disorder, or a combination thereof, which results in minor consequences to a person’s life. ‘Minor consequences’ means that neither the impairments nor the limitations resulting from the injury last more than six months and a person substantially retains his or her pre-accident bodily functions, level of activities and participation in life.” This wording is similar to that contained in Alberta’s MIR. The group also recommended that the minor injury cap amount be increased to between $4,000 to $6,000 from its current level of $2,500 – also with annual indexing to the consumer price index (CPI).

New Brunswick’s government had appointed the auto insurance working group as part of its election platform to re-examine the system. “Unfortunately, a lot of the changes in auto insurance in Eastern Canada are driven more by political ideology than functionality reality,” Plant said. “Where auto insurance has been highly politicized is in New Brunswick. ” The working group met with 40 witnesses across the province throughout 2011, including 12 accident victims. “One of the things that came out of it was that the (victims’) biggest problem with the auto insurance scheme was they had no access to information,” noted Plant.

“They didn’t trust the adjusters or the company people they were dealing with. They didn’t understand what their rights were or how the system worked.”

Plant said that, in some ways, insurers may have been the architects of

at least some of this confusion. He recounted that companies used a sliding scale to compare the minor injury cap payments to those for non-automobile related injuries. “So, if the most severe injury in a non-auto world was $30,000 and the maximum of the minor injury cap was $2,500, then insurers would look at a $15,000 non-auto injury and say, ‘we are only going to give them $1,250 under the cap,’” he said. “That ticked a lot of people off.

They had no place to argue about it.

Lawyers wouldn’t take it on.”

Plant observed that this prompted some of the constitutional legal challenges to the minor injury cap and the Conservative government’s striking of the working group to review the auto insurance system. The government is currently studying the recommendations, which also include a provision for improved communication with customers.

“There is no timeline on this, but it is coming,” Plant said. “At some point, we are going to have a change in the amount of the cap in New Brunswick and just how much of an impact this causes will be influenced by how tight the ‘minor personal injury’ is defined.“

Nova Scotia “The place we are having the most fun in the East right now is Nova Scotia,” Plant said.

In Nova Scotia, the provincial government introduced regulatory changes to the minor injury cap that became effective July 2010. These amendments changed the definition of “minor injury” to mean strains, sprains, and whiplashassociated disorders, also similar to the definition in place in Alberta. But the government also increased the pain and suffering award limit under the cap to $7,500, with an index to inflation.

“Today, that limit is almost $8,000,” Plant noted, adding that the consequences of a minor injury in Nova Scotia can extend to one year, not the six months applied in New Brunswick. “I think that anybody who falls within the cap will be fairly compensated.”

June/July 2012

Claims Canada 13

27/06/12 11:32 AM

However, those amendments represented only one aspect of Nova Scotia auto insurance changes. In April 2012, the provincial government brought in phase one of its two-part “Fair Auto Insurance Reforms,” which doubled medical and rehabilitation expenses from $25,000 to $50,000 (also increasing funeral expenses, death benefits, loss of income and principal paid housekeeper expenses, among other items).

For Plant, the “most interesting” part of the Nova Scotia reforms will take place in April 2013, the second phase of reforms and an exercise he likens to “nailing Jell-o to the wall.”

With these changes, the government will bring in diagnostic and treatment protocols for minor injuries, direct compensation for property damage and, most controversially, an optional tort product for minor injuries.

“I think we could be heading toward the point where the cap won’t exist anymore,” Plant said. He noted that the optional tort endorsement raises several questions – how many consumers will actually pay for it (especially with the increased cap limits), how it will be explained to those consumers and how it will work between insurance companies who have claimants with different product options on the same claim.

“Exactly how that is going to work is anyone’s guess,” said Plant. “I don’t know of any other jurisdiction that has done this sort of thing.”

Ontario “Fun” is not a word widely associated with auto insurance reforms and their progress in Ontario. Instead, several key issues confront independent adjusters as they try to sort through the maze of regulations, medical and legal issues in accident benefits and bodily injury claims. The September 2010 reforms, which involved 41 recommendations including a reduction in accident benefits rehab and medical expenses from $100,000 to $50,000, are increasingly seen as “a needed first step,” according to IBC’s Palumbo.

Several points of contention were raised at the CIAA joint conference panel on Ontario auto insurance. One 14 Claims Canada

p12-17 COVER STORY.indd 14

June/July 2012

key uncertainty is the backlog of more than 30,000 mediation cases at FSCO. The regulator has sent out notices to insurers that it wants to streamline these mediated cases and it has put procedures in place to move this process along. Panel moderator Grossman referred to this as “moving the elephant through the snake.” Insurers remain skeptical.

“There has been lots of talk that ‘the floodgates are coming,’ and this has been a conversation for a good year and a half with FSCO,” noted Aviva’s Becky Cameron. “The challenge we already face right now… is our claims team has a ton of pressure exerted on them by FSCO mediators to just get it done, get it settled. The

Other changes of note include new consumer protection measures that require insurers, agents and adjusters to provide full and clear disclosure of dispute resolution processes and limitation periods to clients who initiate claims. unbiased perspective, as far as the mediation process goes, isn’t happening now. If you quadruple the amount of effort it takes, I think it will sacrifice quality.”

A central problem with FSCO mediation cases is how insurers are, or not, informed of the registration process, according to lawyer Philippa Samworth. Currently, the application for mediation is not copied to insurance companies; only the regulator can register the actual case, which begins a 60-day process to set a mediation date, she explained.

“It just goes to FSCO and sits there in some big box bigger than this room filled with all these things and some little minion pulling one out every now

and then,” Samworth said. “If only the insurer got a copy of it, and if that was mandatory, I think the backlog would be far less. Insurers could get those (minor) ones out of the system.”

The backlog issue is particularly acute with the residual impact on cost structure and premium stability for insurers. Many of the mediations involve treatments and cost guidelines under the minor injury guideline (MIG) in Ontario. How these cases are decided could “re-ignite the accident benefits cost spiral,” according to IBC. Another significant cost development is catastrophic injury claims.

Between 2004 and 2010, the number of no-fault injury claims rose 28%, while the count for large claims has more than doubled, IBC noted. Hospitalizations from motor vehicle accidents are down 12%, yet auto insurers are being presented with many more catastrophic injury claims.

While an expert panel presented its recommendations on the definition of “catastrophic impairment” to the Superintendent of Insurance in April 2011, insurance companies are still awaiting a final verdict. Grossman noted that courts in Ontario have tended to create a much more “inclusive” definition, meaning that a lot more people will qualify for enhanced benefits.

A pressing concern for CAT injury claims is the determination of psychological percentages for the “whole person impairment” criteria – what Samworth calls the “next emerging battle ground.”

What makes the determination of catastrophic injury even more difficult is the limited cap ($2,000) FSCO has put on assessments, according to Lifemark’s Dennis Giesbrecht. “The $2,000 cap has really been a fly in the ointment for us,” he said. “I think 90% of our assessments come in under that cap fairly easily, but it is the complex ones where there are massive files to wade through and significant legal and medical issues, which are challenging.”

If there are issues about the quality of a complex file, Grossman asked www.claimscanada.ca

27/06/12 11:36 AM

Confidence. Trust. Integrity.

CSN Celebrates 10 Years in Collision Repair!

Rest easy knowing you’ve made a good decision. CSN Members pride themselves on genuine service and on the fact that they personally care about delivering a job second to none. The CSN network delivers on the promise to provide an honest, quality repair that is built on confidence, trust and integrity.

Your policyholders reap the benefit of a National Lifetime Warranty on all repairs thanks to our CSN network of leading collision repair facilities across the country.

CSN Collision & Glass is proud to be celebrating a decade of dedication to the collision repair industry. CSN is committed to building stronger relationships Network-wide with all industry stakeholders in order to continue to exceed customer expectations. CSN is dedicated to deliver on this promise today and moving forward.

Visit us at www.csninc.ca to access the CSN Shop Locator.

ad right size.indd 1

19/06/12 11:51 AM

whether p&c insurers could replicate what life and disability insurers have done – hire medical people on staff to provide advice and guidance.

“I think there is a place for that,” said Tammie Norn of ProFormance.

“In terms of types of injuries, adjusters don’t have the budget or timelines on the file to have every case looked at.

For more complex types of injuries, I think there is room for that to provide recommendations on what you should be looking for and the questions to ask.”

The “interface” between accident benefits and bodily injury claims is another source of rising claims costs.

The frequency of injury claims on the tort side has been rising, as has the average claims cost. BI claims now represent more than $2 billion in annual costs, according to the latest figures from IBC. “I think this is something that insurers really need to look at, in terms of changing their practices from an investigative standpoint,” said Norn.

“The BI side has always had the ability to rely on the AB file, which was full of information. Now, with the limited benefits, the information is not necessarily there. The insurer really needs to do investigations early on to understand the exposures, so it is not faced with a statement of claim two years down the road.”

Grossman noted that the “the best

16 Claims Canada

p12-17 COVER STORY.indd 16

June/July 2012

friend of a BI insurer is the AB insurer that does a good job of adjusting the AB file. The worst enemy of a BI insurer is the AB insurer that does a bad job of handling the AB exposures. If an AB file is handled well, it is well documented – you have independent examinations, surveillance. All of this good stuff can come out in the discovery process.”

Alberta Two major issues of relevance in Alberta are the legal challenges to the minor injury regulation (MIR) and changes to the Alberta Insurance Act, some of which apply to auto insurance.

Minor injury is defined as a “sprain, strain or a WAD injury caused by (an) accident that does not result in a serious impairment” under the Alberta MIR. Damages for non-pecuniary loss for minor injuries in vehicle accidents are capped at $4,641 (as of January 2012). Field Law’s Sandra Corbett noted that the “sliding scale” that insurers applied in New Brunswick was rejected by an Alberta court in 2009.

Just as important, according to Corbett, is what may be excluded from classification as a “minor injury.” She cited a Latin phrase “expressio unius est exclusion alterius,” which means that the mention of one thing may exclude others. If the injury is not mentioned in the MIR, it is like-

ly excluded, such as bone fractures, dislocations, cartilaginous injury or psychological injury.

However, it is the definition of “serious impairment,” much like Ontario, that may cause the most problems with deciding which injuries fall within or outside the MIR. In Alberta, a serious impairment is defined as an “impairment of a physical or cognitive function: (i) that results in a substantive inability to perform the: (a) essential tasks of the claimant’s regular employment, occupation or profession (b) essential tasks of the claimant’s training or education in a program or course that the claimant was enrolled in or accepted for enrollment at the time of the accident or (c) normal activities of the claimant’s daily living; (ii) that has been ongoing since the accident; and (iii) that is expected not to improve substantially.“ Corbett noted that when this wording was introduced with the reforms in 2004, “I wondered why plaintiffs spent so much time on constitutional challenges to the MIR, when this definition (of serious impairment) lends itself to a lot of leeway in terms of interpretation.” At the time, she facetiously asked if a neck injury that pre-

www.claimscanada.ca

27/06/12 11:37 AM

vented her from blow-drying her hair constituted a “serious impairment.”

“When you see what happened in the Sparrowhawk case, perhaps I wasn’t being so facetious,” Corbett said. “The plaintiff’s bar, who are very active in Alberta, are going to chip away at the regulation by submitting challenges to definitions like serious impairment.”

In Sparrowhawk v. Zapoltinsky (2012), the issue at hand was whether a jaw injury (TMJ) suffered in a car accident was a minor injury under the MIR. Ultimately, the court held that the plaintiff’s TMJ injury was not a minor injury based on three arguments: • the tooth and cartilage injuries are not muscle, tendon, ligament or WAD injuries; • the jaw injury caused serious impairment in that it created a substantial inability to perform a normal activity of daily living that is non-trivial for that person ; and • all injuries treated principally by dentists are never minor injuries, as dentists are not certified examiners under the MIR nor are they identified as health care professionals under the treatment protocols (and therefore not authorized to evaluate whether an injury is minor).

“I think we were all a bit fearful that this sort of decision would be coming,” Corbett said. “The insurer on this case has not yet decided whether to appeal this case. Right now, it is just one trial judgment.”

Corbett also noted that in the ruling, Justice Shelley discussed the issue of whether the descriptions of minor injuries in the MIR and diagnostic/treatment protocols are unconstitutional because of their ambiguity. While that issue was deferred by the court for a different proceeding, “it really opens the door in Alberta for future constitutional challenges on whether or not the legislation is so vague that we can’t apply it,” she said.

On a different note, Corbett explained that some changes to the Alberta Insurance Act are of significance to auto insurance. In particular a new two-year limitation period for www.claimscanada.ca

p12-17 COVER STORY.indd 17

coverage lawsuits replaces the previous one-year period, a new dispute resolution process is being introduced after a proof of loss has been delivered to an insurer and electronic methods now can be used as a means of communication between insurers and insureds in some instances (but not for policy cancellations).

Other changes of note include new consumer protection measures that

require insurers, agents and adjusters to provide full and clear disclosure of dispute resolution processes and limitation periods to clients who initiate claims. Fair practices regulations also include a provision permitting a person to apply to a court for an order for an advance payment on a personal injury claims being negotiated with an insurance company. All of the changes are effective July 1. 

June/July 2012

Claims Canada 17

27/06/12 11:33 AM

• spotlight S

Northern Lights SCS Insurance Adjusters Ltd. is a family-run adjusting firm with long roots in northern Ontario and deep pride in being independently owned and operated.

BY CRAIG HARRIS

U

nlike a lot of 70-year-olds, you won’t find Gary Gauthier lining up shots on the links or taking an afternoon nap in the workweek. You will find him, well, at work.

After starting up SCS Insurance Adjusters Ltd. in 1964 in Sudbury with his older brother Hazen (now retired), Gary has stayed closely involved with the operation. “I still adjust claims and bring in accounts,” says Gary, who is proprietor. “But the overall running of the business has moved to Greg and Jennifer.”

That would be his son Greg Gauthier, president of the five-branch adjusting firm, and daughter Jennifer Gauthier, vice president, both being senior claims adjusters. SCS Adjusters is an independently owned and operated family-run business well known in the Nickel Belt and beyond of northern Ontario.

“I am in the office on a day to day basis, but I see my role more as guiding, “ Gary observes. “I like this profession, I like the business and I like being able to see my family working and succeeding at what they do.”

SCS Insurance Adjusters Ltd. is headquartered in Sudbury, but cov-

18 Claims Canada

p18,19 SPOTLIGHT.indd 18

June/July 2012

SCS Insurance Adjusters Ltd. (from left): Gary Gauthier, Jennifer Gauthier, Greg Gauthier

ers a vast swath of northeastern and northwestern Ontario with branch offices in North Bay, Sault Ste. Marie, Timmins and Thunder Bay. It employs eight adjusters and six support staff.

Gary notes that SCS used to have more branch offices, but it consolidated to five to reflect broader changes in the insurance industry. “I recall when it used to be primarily brokers in charge of assigning claims files, but that shifted some time ago,” he says.

“Insurance companies have taken on that role and internalized the claims assignment function. Brokers are still involved, but not as much.”

Now, it is common for independent adjusters to see direct assignment

of contractors by the insurance company in claim situations. Gary says he doesn’t believe there is anything particularly wrong with this strategy – if handled properly. “The contractors’ responsibility is to the insurer and sometimes they send estimates without notifying the adjuster,” he observes. “There can be an issue with communication and coordination.”

While he has seen trends come and go, Gary holds that the business of adjusting and insurance still involves the human element. “It really comes down to relationships, “ he says. “We demonstrate a commitment to our business partners, and we take care of their clients. If there is a problem, we

www.claimscanada.ca

27/06/12 11:45 AM

fix it. They key is to establish that level of confidence with your partners. You have to sell your company and stand behind your product.”

As a general insurance adjusting firm, SCS Adjusters offers 24-hour service and access to a full complement of staff to serve individuals in English, French and Finnish. Gary says employee loyalty and longevity is a key factor contributing to the firm’s success over the years. ”We have good people who are qualified, many of whom have been here for 20 years or more,” he notes.

“You know who you are dealing with.”

Gary adds this stability is complemented by a sharp focus on expertise, industry designations and ongoing education.

A dedicated team of administrators underpins the adjusters. “Strong support staff and administration has been vital in keeping high production standards and assistance to clients, examiners and adjusters in day to day operations,” he says.

While SCS Adjusters handles all general classes of insurance, it also has some specialty areas. One is municipal work. Currently, it represents the City of Thunder Bay and, for several years prior, held the contract for the City of Greater Sudbury. Through these municipal accounts, it has been called on to adjust several catastrophic losses.

For example, when heavy rainfall led to severe flooding in Sudbury in April 1997, SCS Adjusters was called on to handle more than 800 claims.

This flood resulted in $21 million in insured losses and remains one of the most significant insurance payouts in northern Ontario.

Gary says his firm has set up a comprehensive catastrophe plan to kick in when crises occur.

“We have a solid CAT plan and we have used it on several occasions,” he remarks. “One of the biggest issues in a crisis event is talking to the people who have suffered the loss. If you can get there quickly and show empathy, you have addressed their main con-

www.claimscanada.ca

p18,19 SPOTLIGHT.indd 19

cern. For many of them, this is the most important thing in their lives at the moment – they want someone to show understanding. Let’s face it, if you were wading around in three-feet of sewage back-up in your basement for four days, you wouldn’t be a happy camper either.”

Gary Gauthier: Optimistic about the future of the independent adjuster in Canada

SCS Adjusters’ crisis planning could also come into effect this year, as recent flooding in Thunder Bay and wildfires around the Timmins area have caused significant damage. Another niche aspect of the firm is heavy equipment losses and Gary notes that there will likely be several claims in the wake of the blazes around Timmins, particularly when the main highway, 144, into the area is re-opened.

“A big part of the difficulty when there is a natural disaster is waiting to see what the files are going to look like,” Gary says. “In many cases, the area is closed, highways are shut down, so you have to be prepared to kick

in when it is re-opened and move as quickly as possible on the files.”

While SCS Adjusters primarily handles adjusting in Ontario, it has relationships with other firms across the country for more extensive claims.

Here, Gary has found the breadth of geographical representation of the Canadian Independent Adjusters Association (CIAA) invaluable.

“We primarily rely on the CIAA for networking with other firms across Canada on out-of-province claims,” he notes. “We have found several firms we are comfortable working with; we pass business to them and vice versa.

These networking opportunities are a key part of the association.”

Gary Gauthier says he is a “property specialist,” yet he appreciates the specialization and knowledge required to adjust other types of claims, particularly accident benefits in Ontario (to which he defers to his daughter, Jennifer). When it comes to this expertise, he sees a looming concern on the horizon for independent adjusting firms: available talent.

“The problem right now is where we will turn to for new adjusters,” he observes. “It is pretty thin. This is going to be a problem down the line, especially when it comes to specialist areas like AB. There is a lot of training required. I think we used to see more generalists in this industry, but now there is segmentation and specialization, which means more training in defined areas.”

Even with this challenge, Gary remains highly optimistic about the future of the independent adjuster in Canada.

“I think adjusters will always be around because we provide an important service in the field and in the community,” he concludes. “Insurers have tried doing it themselves, often more as an expense-savings factor. But when there is a crisis in Smooth Rock Falls, for example, it is hard for them to get there. Economically, it doesn’t make sense. And that’s when they need us.”  June/July 2012

Claims Canada 19

27/06/12 11:45 AM

Wildfires in Canada

Members of the Slave Lake wildfire review committee put their recommendations in context

BY PETER FUGLEM AND BRIAN STOCKS

While forest fires are ubiquitous across much of the Canadian landscape (an annual average of more than 7,500 fires and more than 1.9 million hectares burned over the past decade), many decades of successful fire suppression programs resulted in very limited impacts on communities during the latter half of the 20th Century.

However, the 2003 Firestorm in British Columbia caused substantial home and business losses in Kelowna and Barriere, and brought home to Canadians the fact that they were not immune to communities being directly impacted by wildfires.The 2011 events in the Slave Lake area only served to reinforce the message that many Canadian communities are similarly at risk, particularly as the wildland-urban interface continues to expand and fire activity across Canada is forecast to increase as a result of climate change.

This was a message stated clearly in the Canadian Wildland Fire Strategy (CWFS), developed in 2005 and supported by all provincial and territorial governments across Canada, along with the federal government. The CWFS recognized that increasing future fire activity and impacts were inevitable, and that Canadian governments needed to work closely, along with an informed and involved public, to lessen future impacts, particularly on exposed communities.

Despite being signed by all governments, the CWFS has not been substantially implemented due to a lack of funding.

In recognition of the significance of the wildfires that impacted Slave Lake and surrounding communities in May 2011, the Minister of Alberta Sustainable Resource Development (ASRD) established the Flat Top Complex Wildfire Review Committee in June 2011, of which we were members. The Committee was also supported by a team of wildfire experts who documented fire science and operational information related to the Flat Top Complex and provided technical advice.

The review was titled the Flat Top Complex Review as it encompassed the “fire complex” involving three fires that threatened the Slave Lake area. The review teams and Committee were formed shortly after the fires and quickly began work with on the ground data collection, as well as inter20 Claims Canada

p20, 22-23 ICLR WILDLIFE.indd 20

June/July 2012

views with those involved in the firefighting response and stakeholders. Several important recommendations were made by the Committee to the Alberta government. But first, some context about the fires in Slave Lake region in May 2011.

The “Flat Top Complex” in Context In mid-May of 2011 two high-intensity forest fires in central Alberta, driven by sustained strong winds under low relative humidity conditions, burned into a combined total of four communities (the town of Slave Lake, and the surrounding communities of Poplar Estates, Widewater and Canyon Creek). More than 500 homes and businesses were destroyed, with an estimated insured loss of $700 million.

The social and emotional impacts of these fires are still being felt strongly within these communities a year later.

A number of key factors were identified as influencing the events of May 14 and 15. Foremost among these were the sustained and extremely high wind speeds which, in combination with low relative humidity values created very dry fine fuels and high intensity crown fire development, with prolific downwind spotting. Crown fires typically have flame lengths from the ground to above the tree crowns, and often involve significant spotting, which is the transport of firebrands ahead of the main fire front. Crown fires are nearly impossible to suppress with direct attack.

The high winds also hampered air operations and led to the suspension of air attack during the critical fire period on the afternoon on May 15th. A very high fire load across much of Alberta during the mid-May period made adequate resourcing of wildfires a challenge.

During the May 11-15 period a large number of significant wildfires started across the province, with sustained strong winds creating major wildfire suppression difficulties. Initial attack and sustained attack resources were quickly committed, and additional national and international resources requested. A total of 189 wildfires occurred across Alberta during this period, threatening over 23 communities/locations (e.g., camps, worksites, parks, wildfire lookouts).

In the Lesser Slave Area 52 wildfires occurred, threatening roughly 10 communities/locations. The Richardson Fire north of Fort McMurray spread 70 kilometres north in two days, eventually burning nearly 600,000 hectares. Two www.claimscanada.ca

27/06/12 11:56 AM

WE RESTORE with CONFIDENCE

[ WATER ] [ FIRE ] [ WEATHER ]

24/7/365 EMERGENCY RESPONSE NATIONAL COVERAGE PROFESSIONAL PROJECT MANAGEMENT QUALITY ASSURANCE - COMMITTED TO EXCEEDING SERVICE LEVEL AGREEMENT REQUIREMENTS POLICYHOLDER SATISFACTION FOCUSED When things go wrong, we have the right approach to restoration. It begins with a companywide commitment to customer service to our broker, adjuster and policyholder clients. With the expertise, experience and equipment to handle losses of any size – with national coverage. Our emergency response, 24/7/365 days a year, has us always available. Our detailed reporting and single source of contact model provides for an efficient and smooth process. Committed to exceeding service level expectations and policyholder satisfaction. Contact Paul Davis Systems today, we’re ready to make things right for you.

1 800-661-5975

EMERGENCY

RESPONSE 24/7/365

www.pds.ca

ad size.indd 22

17/04/12 3:35 PM

Lesser Slave Area wildfires were responsible for the damage to Slave Lake (Fire 65) and surrounding communities (Fires 56 and 65) started on May 14th. These fires, along with a smaller fire near Slave Lake that started on May 15th but had no impact on communities (Fire 82), were designated and managed as the Flat Top Complex.

Review Recommendations The Committee was charged with reviewing ASRD efforts before, during and after the wildfires, and met with key stakeholders and ASRD staff, along with experts in forest fire science and operations before issuing a report and recommendations in May 2012.

The Minister of the newly formed department of Environment and Sustainable Resource Development is developing an implementation strategy in response to the Committee’s recommendations.

A number of key areas were investigated by the Committee including the long and short-term contexts of the Slave Lake event. Over the past decades, as mentioned, there have been several large fires potentially threatening Slave Lake and other communities. As a result, Alberta developed sophisticated wildfire response capabilities and a FireSmart program to reduce wildfire damage to homes and communities. In the weeks previous to the Flat Top Complex, the fire conditions in Alberta of extreme drying conditions in combination with the winds resulted in conditions for explosive fire growth over most of northeast Alberta.

The Committee considered this context as well as a broad range of potentially contributing factors. As a result seven themes with 21 recommendations were developed: 1. Wildfire prevention: the number of human-caused fires continues to increase in Alberta which adds to the chal-

Wildfires

Key Facts for 2012 Much of North America experienced an unusually mild, snow-free winter in 2011/2012.

• In March, 15,000 warm temperature records were broken in the U.S. while in Canada, “we broke the record for the number of records broken.”

• Several forestry agencies across the continent have warned of hot and dry conditions in many regions.

• As a result of such conditions, Alberta moved the start of wildfire season up a full month to March 1.

• By the third week of May, Ontario had already recorded twice the number of fires recorded in 2011 (297 fires have so far burned 33,000+ hectares vs. 178 fires burning 4,387 hectares in all of 2011).

• Large fires have already threatened Timmins, Ontario (population 45,000) and Kirkland Lake, Ontario (population 8,000).

• Temperatures across Canada are expected to be above average, while precipitation is expected to be below average.

• Canada could (stress ‘could’) experience an active fire season in 2012.

Source: Institute for Catastrophic Loss Reduction

22 Claims Canada

p20, 22-23 ICLR WILDLIFE.indd 22

June/July 2012

lenge during extreme conditions. Enhancements in overall prevention of wildfires including industrial fires and with escalated measures during extreme conditions were recommended. In reviewing the FireSmart program, it is a significant challenge for most jurisdictions to maintain priority for FireSmart funding and community level activities. In some areas, it is also a challenge to obtain community acceptance and support for the program.

This continues to leave many communities at risk in fire prone areas. The Committee recommended that a funding model be implemented that broadens engagement and a priority established to accelerate on-ground treatments.

2. Preparedness and capacity: Several challenges were experienced by response organizations in the period preceding and during the Flat Top Complex. The acceleration of fire activity across Alberta occurred at the time when many firefighters and aircraft were just coming online for start of season. The Type 1 (highly trained) firefighters quickly became committed across the province.

As homes came under threat both wildland and structure firefighters were committed to saving structures.

The Committee recommended earlier start dates for resources and additional crews specialized in large fires. In order to anticipate and prepare for extreme conditions capabilities to predict fire behavior were recommended as were advancing requests for assistance. The Committee also recommended a program to expand involvement of fire departments in protecting structures using the existing mutual aid network.

3. Communications: in any fast moving emergency, communications with responders and stakeholders are critical but often challenging to manage. In that regard, the committee recommended standards and training for liaison staff, enhancements to weather advisories and support for new communications technologies. As well, under rapidly expanding response organizations, dispatch systems must be capable of handling the increased volumes of communications to support command and control. The committee recommended looking at options for enhancing Alberta’s wildfire dispatch systems.

4. Organization and incident management: major events like the 2011 wildfire season test an organization and its priorities. The Committee recommended realignment of the reporting relationships for wildfire responsibilities to ensure direct lines of reporting, with regular internal assessments of strategies, priorities and procedures. As well, in the context of provincial emergency response, the Committee recommended a consistent implementation of both the Incident Command System and use of Incident Management Teams.

5. Post-wildfire business resumption: the SRD Area office and many staff were directly affected by the wildfires and associated events which significantly complicated the post-wildfire response and recovery. Given the importance of SRD operations during and following the event,

www.claimscanada.ca

27/06/12 11:57 AM

there were many lessons to be learned. The Committee recommended a review of SRD business continuation plans to extend those learnings to future events.

6. Policy and legislation: policy and legislation are developed to deal with known conditions and expected situations. The 2011 wildfire season was well outside of the experiences of Alberta at the time its policies and legislation were last updated. The Committee recommended a review and appropriate update of relevant policies, procedures, acts and regulations and necessary updates to training and familiarization for staff.

7. Research and development: the 2011 wildfire season presented a number of key areas of potential new information for Alberta and other jurisdictions. The Committee recommended collaboration on research in a number of key areas, including factors contributing to fire spread and home losses, that will help prediction and prevention in the future. Another recommendation is to enhance the Presuppression Preparedness System with new information from 2011.

In addition to the recommendations, the team looked at the effectiveness of fire suppression activities over the period of ignition to containment of the Flat Top Complex fires. In the face of wide ranging opinions from the public and various experts, the Committee did not believe that alternative

actions as discussed could have been safely implemented that would have guaranteed improved outcomes.

The wildfires of 2011 in Alberta and the 2003 fire season in British Columbia are considered by many wildfire experts to be a harbinger of an emerging new reality. Several factors are cited as likely contributors to a change in the risks to Canadian communities and residents in the wildland-urban interface.

Climate change is often seen as the primary driver; however, two other factors also appear to contribute. Increasing and expanding activity in Canada’s wildlands amplifies the risk of fire starts and of investments being in the way of wildfires. Canada’s forests and wildlands are changing as a result of historic wildfire exclusion so that our forests are aging especially around communities. This has exacerbated problems with forest health and increased flammability.

Wildfires will continue to make impressive and uncontrollable runs through Canadian wildlands. If the number and behavior of wildfires increase and development expands into wildlands, 2003 and 2011 type events will logically become more frequent unless significant collaborative actions are taken by all parties (government, stakeholders, public) to prepare for and to mitigate the risks.  Peter Fuglem and Brian Stocks were members of the Flat Top Complex Wildfire Review Committee.

Our goal is to make them feel like it never happened.

When they felt like their lives were falling apart, we were there to put the pieces back together.

The first time that someone experiences a flood, fire or natural disaster, it can be devastating.

That’s why it’s important to have someone on their side who has been there.

head on. Most importantly, it means minimizing the damage done to a home, and having all the answers that a homeowner is seeking right now.

Years of experience in this industry means taking action right away and dealing with the situation

1-800-RESPOND servicemasterrestore.ca

www.claimscanada.ca

p20, 22-23 ICLR WILDLIFE.indd 23

Restoring Peace of Mind®

June/July 2012

Claims Canada 23

27/06/12 11:57 AM

Uncovering Canada’s Catastrophic Risks

BY PAUL THENHAUS

Compared to other countries, Canada has been fortunate to avoid large-scale economic destruction from natural disasters, such as events witnessed last year in Japan, New Zealand and Thailand. However, while the country is fairly well protected against such perils, depending on geographic location and other factors, there is still significant exposure risk.

A thorough understanding of the risk landscape, integrated with catastrophe models, can help claims professionals better manage resources and response, even in advance of the event.

Of all disasters throughout Canadian history, natural perils have accounted for 70 percent, with flooding being by far the greatest – and most costly – source in the 20th century. To put this in perspective, in 2009 insurance payments for all events in Canada totaled $5.3 billion – of that amount flooding was responsible for $1.3 billion. The Red River, with its long history of flooding, caused extensive damage in 2009 in Manitoba due to ice jams and snowmelt, and additional precipitation on flat ground, while in the 2011, the Assiniboine River caused widespread damage in both Manitoba and Saskatchewan. To a lesser degree, but common nonetheless, are tornadoes. Surprisingly, Canada has the second largest amount of tornadoes (next to the U.S.), concentrated mostly in the southern regions. And, while rare, they can be severe, such as the F5 recorded in Elie, Manitoba in 2007.

But, perhaps the most regularly occurring natural perils in Canada are earthquakes, with approximately 4,000 recorded each year. Half of these occur in or off the shore of British Columbia. Over the past century, at least nine earthquakes in this area have registered a magnitude greater than 7 – notably, the (magnitude) M7.3 earthquake that hit British Columbia’s southern Vancouver Island in 1946, and the M8.1 Queen Charlotte earthquake – the largest in Canada’s history – which occurred off the coast of nearby Graham Island three years later. The presence of the active Cascadia subduction fault in an active boundary between the North American Plate and the subducting Juan de Fuca Plate in the Pacific Ocean makes western Canada, especially southwestern British Columbia, the most earthquake-prone region, especially susceptible to major, damaging events.

Since 2004, four earthquakes exceeding M8.5 have struck worldwide– two in Sumatra (M9.1 in 2004, M8.6 in 2005), one in Chile (M8.8) in 2010, and last year’s Great Tohoku (M9.0) in Japan. Seismologists have suggested that this pat24 Claims Canada

p24-25 EQECAT.indd 24

June/July 2012

tern of megaquakes may actually occur in clusters. If this current cluster follows the one that occurred between 1950 and 1965, which saw six events ranging from M8.6 to M9.5, then it appears we may be only about halfway through, with the largest quake perhaps yet to happen. The Cascadia subduction zone is part of the “Circum-Pacific Ring of Fire” where these types of earthquakes occur most frequently on a global basis. While the Cascadia subduction zone converges only half as fast as tectonic plates in Chile or Japan, it does have a history of generating magnitude 8.5 or larger earthquakes, although not since 1700. And, the active Cascadia subduction zone is capable of producing the same size of earthquakes as in Indonesia and Japan.

While things tend to be quieter in southeastern Canada, they are not risk free. Because it is located within a stable continental region of the North American Plate, the rate of earthquake activity has been relatively low. Yet, the slow movement of this plate combined with other forces acting upon it creates sufficient stresses to have caused earthquakes of M6.0 over the decades in the St. Lawrence and Ottawa valleys. In fact, seismic sources zones along the St. Lawrence River consist of individual clusters of historical concentrations, such as the Western Quebec and Charlevoix seismic zones, which have consistently generated some of the largest earthquakes in southeastern Canada. However, earthquakes of this region seldom rupture faults all the way to the ground surface lending significant uncertainty to their causative structures.

The Canadian Risk and Hazards Network has determined that a significant earthquake is Canada’s greatest potential natural disaster. Fortunately, past earthquakes have not resulted in extensive property damage, primarily because a large event has yet to strike a heavily populated, and, therefore, highly insured area with significant exposures. But if an earthquake were to strike near one of Canada’s major urban areas, even a M6.0 would be devastating. Vancouver and Victoria would be most at risk: Estimated insured losses could approach $100 billion, with Vancouver sustaining about 20 percent of losses. Total economic damage could exceed $400 billion in that region alone, but Montreal, Ottawa, Toronto and Quebec are also vulnerable.

Because Canada experiences damaging earthquakes only every few generations, a much longer time scale than say, in California, there is little or no social memory of these devastating events. As a result, there is considerable resistance to spending the time and money to adopt earthquakeresistant designs, update code standards, retrofit building www.claimscanada.ca

27/06/12 12:04 PM

stock (especially in the older cities), or implement other preventive measures. Would high-rises, even if they are code compliant, be able to meet expectations for usability and repair/rebuilding costs? In the older cities such as Vancouver, would the numerous masonry buildings survive and the ongoing efforts to move hazardous overhead electric transmission systems underground be completed in time?

Practising Model Behaviour Of course, it is not yet possible to know when and where a major earthquake will occur, but history tells us it is inevitable. Insurance professionals can turn awareness of this into action by embracing scenario planning and using catastrophe models. Re/insurers appreciate the value of a model’s simulation sets, built from past events, to help them establish rational expectations about risk, but claims professionals can and should also be taking advantage of the technology both before and after disaster strikes to reduce surprises and better allocate resources. So, if there’s a major earthquake in a low seismic region like Quebec, even in the absence of recent history, claims managers can look at a model’s hazard maps to determine such details as how hard the ground might shake and how the soil would behave, and how structures of a specific vintage and construction are likely to react to these elements.

This data is incorporated into models in a different manner than would be in seismic code requirements. Using mod-

www.claimscanada.ca

p24-25 EQECAT.indd 25

els in conjunction with building code products can reduce the potential for bias judgment that comes from relying too heavily on building codes alone. For example, the methodology for incorporating soil amplification of earthquake motions into a base map of ground motions is known to have a bias to the high side, which meets code standards, but is not a true estimation. Catastrophe modelers change the reference conditions for soil to amplify or de-amplify the earthquake motions, thereby reducing the degree of bias.

Information derived from a model can also help claims managers pre-negotiate with suppliers, plan alternative transportation routes and provide backup to areas that could be disrupted. When an earthquake or other disaster does strike, they can compare the hazards sets against their portfolio and plan staffing resources accordingly, such as the number and experience level of adjusters to deploy to the site. With time a critical component to claims processing, a model can make getting on the ground faster and more efficient.

Claims managers have a choice. Canada’s current state of seismic inactivity can make them either vulnerable or prepared. As General Douglas MacArthur said, “There is no security on this earth; there is only opportunity.”  Paul Thenhaus is senior geologist of model development for catastrophe modeling firm EQECAT, Inc. (Tim Trainor, client relationship director, assisted with this article.)

June/July 2012

Claims Canada 25

27/06/12 12:04 PM

Controlling Environmental Remediation Costs

BY KEITH STEPHEN

We have all heard the horror stories of how expensive the remediation of a contaminated site can become. Even the simplest of fuel oil spills have been known to amount to well over a million dollars in clean-up costs due to overzealous contractors, inappropriate use of technologies and lack of oversight. How can those involved in property claims manage these challenges and the resultant unnecessary costs? Forensic Engineers experienced in the hands-on management of such losses and peer review of the quantum of damages in litigation can offer valuable insight to equip adjusters and insurers alike with the knowledge to control costs and remedial timelines before they get out of hand.

There are several key factors that contribute to the complexity of an environmental remediation claim, including site characteristics (e.g. depth and type of soil, depth to groundwater, presence of onsite structures and potential migration pathways, etc.), and contaminant characteristics (e.g. quantity of contaminant released and chemical/physical properties of the contaminant, etc.). As a rule of 26 Claims Canada

p26-28 GIFFIN copy 1.indd 26

June/July 2012

thumb, costs associated with remediation of a contaminant release increase as the degree of complexity increases.

However, there are several key steps that can be taken to ensure that site remediation is completed in the most timeeffective and cost-efficient method practicable, beginning with the retention of a professionally qualified independent environmental consultant.

The selected environmental professional must be either a Professional Engineer (P.Eng.) or Professional Geoscientist (P.Geo.) and may also need to be formally designated by the Province (such as Ontario’s Qualified Person designation). It is essential that the independent professional be one who is not affiliated with the remediation contractor or any of the subcontractors or suppliers that would potentially stand to profit from the remediation activities in order to maintain true ‘arm’s length’ direction of the project.

The trend towards ‘turnkey solutions’ does not often mesh well with the need for the professional to be separate and independent from the contractor, given the potential for conflict of interest and bias that can result. Forensic

Engineers offer added value of being well versed in the particularities of insurance claims, subrogation and litigation and have a special eye for the particular challenges of complex environmental losses, as discussed below. Once on board, the professional environmental consultant must consider the following aspects in order to control and mitigate remedial costs.

Adequate Delineation It is imperative that the environmental consultant carry out a thorough site investigation to determine the vertical and lateral extents of the loss-related environmental impacts.

Such an investigation could be combined with limited emergency response measures to remove gross contamination from the point of loss (e.g. immediate excavation of petroleum hydrocarbon-saturated soil in the vicinity of a failed outdoor aboveground storage tank). Further remediation activities should be delayed until the consultant has developed an adequatewww.claimscanada.ca

27/06/12 12:10 PM

ly detailed conceptual site model. Failure to adequately delineate the extents of the contamination in advance of proceeding with a chosen remediation methodology can constrain the ability to carry out the remediation in a cost effective manner and could result in longer timeframes and unnecessary duplication of efforts.

The environmental consultant should also be aware of the potential presence of pre-existing, non-lossrelated contamination, and seek to provide a means of differentiating such contamination from that related to the subject loss. This matter could be straightforward if the pre-existing contamination is readily distinguishable from the contamination resulting from the subject loss (e.g. encountering high concentrations of gasoline in soil while undertaking the remediation of a fuel oil release), but more detailed analysis of the chemical ‘fingerprint’ may be required if the pre-existing contamination is similar in composition to that associated with the subject

loss. This is especially important when a recent loss can be distinguished from historical spills and releases due to the ageing of the chemical profile over time. Clean-up of older and unrelated contamination can greatly increase remedial costs due to sources that may not have fallen under the loss coverages to begin with.

Identification of the Appropriate Remediation Criteria A long standing debate exists on the topic of ‘how clean is clean’. This debate is especially lively on the topic of remediation of fuel oil releases (a.k.a. heating oil or furnace oil) from failed storage tanks. This debate differs by jurisdiction. In Ontario, the Technical Standards and Safety Authority (TSSA) has well defined regulatory control over such releases unless there is a likelihood of an off-site adverse impact, in which case the Ontario Ministry of the Environment (MOE) would take the regulatory lead.

In the TSSA Environmental Management Protocol (EMP) for fuel handling sites in Ontario (May, 2007), it is clearly indicated that it is acceptable to use the applicable MOE site condition standards as the remedial objective.

The appropriate standard is based on a variety of factors (including: soil pH, proximity to bodies of water, depth of overburden, soil grain texture, whether or not groundwater is used as a potable supply, and property use, etc.).

The MOE standards, which were determined in consideration of the level of acceptable risks to both human and ecological receptors, generally allow for some detectable level of petroleum hydrocarbon-related parameters in the soil and groundwater upon completion of remediation. Given that the MOE standards allow for minor amounts of contamination to remain, the use of more stringent remedial standards (e.g. cleaning to a ‘pristine’ condition where no detectable concentration of

CAPTION CONTEST Might want to turn up the thermostat dear, I’m feeling a bit of a draft

Congratulations to our winner:

Audrey S. Francis Claims Supervisor, Aon Reed Stenhouse Inc. One London Place, 255 Queens Ave, Suite 1400 London Ontario

Thank you for all of your submissions.

Watch for next issue’s contest Debby Matz

Winmar Property Restoration Specialists with over 60 locations across Canada www.winmar.ca

24 HOUR ASSIGNMENT/EMERGENCY RESPONSE • TOLL FREE 1-866-4-WINMAR (494-6627)

www.claimscanada.ca

p26-28 GIFFIN copy 1.indd 27

June/July 2012

Claims Canada 27

27/06/12 12:10 PM

the contaminants are present) could result in unnecessary remediation and thus unnecessary remedial costs and damages.

Evaluation of Remedial Options Once the extents of contamination have been determined, the environmental professional should evaluate the various methodologies available to effect the remediation of the loss-related contamination. Various options

should be compared and contrasted based on the factors of cost, timeline, and certainty in order to ensure that the most appropriate remedial approach is chosen. These factors must also be weighed against the objectives, risk and cost tolerance and expectations of the stakeholders (including the insurer and the insured). Above all, the selected approach must be free of bias when those that may profit from a given technology or disposal option are the ones that will be doing the

Claims Canada Magazine is the only national claims publication COVERING the Canadian market

Reaching Over 8,500 Insurance Claims Professionals from Coast-to-Coast!

For advertising space information, please contact Paul Aquino, Publisher: paul@canadianunderwriter.ca

www.claimscanada.ca 28 Claims Canada

June/July 2012

work. In instances where soil contamination is confirmed to have migrated beneath an existing site structure, the alternatives evaluation should include consideration of partial or complete demolition of the structure in order to facilitate direct access to the contamination versus temporary relocation of the structure or provision of structural support during remediation activities.

In some cases, the under-supporting of a simple structure can incur far greater costs than those for the demolition and reconstruction of a building.

Summary In order to best manage the challenges inherent in contaminated site remediation losses, insurers and adjusters should insist on the use of a truly independent environmental consultant to determine the required scope of the remediation and to oversee the remediation activities from an ‘arm’s length’ perspective, so as to avoid any conflict of interest (either real or perceived).

The environmental consultant should: endeavour to identify the vertical and lateral extents of contamination before proceeding with a chosen remediation approach; be aware of the potential presence of pre-existing contamination unrelated to the subject loss; ensure that the appropriate remediation standards are applied; and communicate the available remedial options and alternatives to the insurer and other stakeholders to ensure the selection of the best approach.

Following these simple strategies will help avoid many of the common pitfalls of environmental remediation claims gone awry and will help to mitigate the resultant damages while helping to streamline future subrogation and recovery efforts. Most importantly, engaging the proper independent resources removes bias and conflict of interest and ensures that a $100k loss does not become a $1M loss.  Keith Stephen, B.A.Sc., M.Eng., P.Eng., is an environmental engineer with the forensic engineering firm Giffin Koerth Inc., and has successfully managed dozens of environmental site assessments and site remediation projects, including several for Insurers. www.claimscanada.ca

Official Journal of the Canadian Indeépendent Adjusters’ Association

p26-28 GIFFIN copy 1.indd 28

27/06/12 12:11 PM

Where Today’s Risks Meet Tomorrow’s Solutions September 9 - 12, 2012 Saskatoon, Saskatchewan

Co-Chairs Doug Brown: dbrown@regina.ca Lisa Brost: Lisa.Brost@bhpbilliton.com

Contact Charlene Roth-Diddams: charlene@pophasemail.com

PRESENTED BY

ad size.indd 22

RIMS CANADA

TM

23/04/12 9:55 AM

Cross-Border Tort Cases A Changing Environment

BY KEN MACDONALD

The Supreme Court of Canada has recently changed how courts are to decide, in tort cases, whether a court has jurisdiction over non-resident defendants. It has made less subjective and more predictable the approach to determining whether there is a real and substantial connection between the province and the defendant or the subject matter of the case. Such a connection is a long-standing constitutional 30 Claims Canada

p30-32 CROSS BORDER 2.indd 30

June/July 2012

prerequisite for a court to take jurisdiction over a non-resident defendant (absent the defendant’ consent to jurisdiction).

The cases, Van Breda v Village Resorts Ltd., Club Resorts et al. and Charron v. Village Resorts Ltd., Club Resorts et al. reached the Supreme Court not because of unusual facts, but because of widespread sentiment that the existing law was in need of review. In fact, there were several interveners at the Ontario Court of Appeal and at the Supreme Court – and the Ontario

Court of Appeal convened a special panel of five judges, instead of the usual three, to hear the case.

Both cases involved Canadian tourists who had accidents at resorts in Cuba during vacations they had arranged in Ontario. Both resorts were managed by Club Resorts, a company based in the Cayman Islands, which had marketed the resorts in Ontario.

Ms. Van Breda was catastrophically injured when exercise equipment collapsed; after leaving Cuba she took up residence in British Columbia. Dr. www.claimscanada.ca

27/06/12 12:29 PM

Charron drowned while scuba diving during an all-inclusive scuba diving vacation. The plaintiffs in both cases sued, in Ontario, the parties from whom they had bought their vacations, the management of the resorts, and others, including defendants from Canada, Cuba, and the Cayman Islands.

As often happens in cross border cases, some of the foreign defendants asked the court to stay the proceedings. There are broadly speaking two grounds on which a court may stay the proceedings. One is that the court lacks jurisdiction (i.e. that there is no real and substantial connection). The other is that, although the court has jurisdiction, it has applied the forum non conveniens doctrine, which gives the court a residual power to decline jurisdiction in appropriate but limited circumstances to assure fairness to the parties and the efficient resolution of the dispute. The court will exercise its discretion to decline jurisdiction if it determines that an-

other court elsewhere is clearly a more suitable forum.

Under the pre-Van Breda law, when defendants challenged the court’s jurisdiction over them, the court would first consider several factors to decide whether there was a real and substantial connection, namely: 1. the connection between the forum and the plaintiff’s claim; 2. the connection between the forum and the defendant; 3. unfairness to the defendant in assuming jurisdiction; 4. unfairness to the plaintiff in not assuming jurisdiction; 5. the involvement of other parties to the suit; 6. the court’s willingness to recognize and enforce an extra-provincial judgment rendered on the same jurisdictional basis; 7. whether the case is interprovincial or international in nature; 8. comity (that is, respect for the courts of other jurisdictions), and the standards of jurisdiction, rec-

ognition, and enforcement prevailing elsewhere If the court found a real and substantial connection based on these eight factors it would then proceed to the forum non conveniens analysis. Here the court considers such things as the location of the parties, witnesses, and evidence, whether another proceeding was underway in that other court, whether differences in the laws of the two jurisdictions might help or hinder one side or the other, and the like.

The problem was that some of the eight factors regarding real and substantial connection, such as fairness (factors 3 and 4) and comity (factor 8) are suitable only for deciding which of two jurisdictions are the best place to hear the case, not for deciding whether a real and substantial connection to the home jurisdiction exists (incidentally, fairness to the defendant(s) included consideration of whether it/ they have insurance.) Several commentators had observed that the fore-

24HR

www.claimscanada.ca

p30-32 CROSS BORDER 2.indd 31

June/July 2012

Claims Canada 31

27/06/12 12:26 PM

going approach was too subjective, too complicated and insufficiently predictable.

In a unanimous decision, the Supreme Court of Canada has changed the law in mainly two respects. The first change is that a real and substantial connection is to be presumed (subject to rebuttal) if one or more of certain, objective, factors that connect the subject matter of the litigation with the forum exist. If no recognized presumptive connecting factor applies, the court should not accept jurisdiction. The SCC indicated that in tort cases, these presumptive connecting factors include: a) the defendant is domiciled or resident in the province; b) the defendant carries on business in the province; c) the tort was committed in the province; d) a contract connected with the dispute was made in the province.

The Supreme Court found a real and substantial connection in Van Breda – the contractual relationship formed in Canada with the Cuban resort – and also in Charron, the fact the resort carried on business in Ontario, not just by advertising but also with an office and frequent visits by staff to promote its resort. The Court allowed both cases to proceed in Ontario.

The Supreme Court made clear that courts may identify other new presumptive connecting factors, i.e. connections giving rise to a relationship with the forum that is similar to the four factors listed above, but it did not say much about what would qualify as a presumptive connecting factor. It also clarified that neither the mere fact the plaintiff is present in the jurisdiction, nor that the injured plaintiff has incurred income loss or medical costs there, nor considerations such as fairness, comity and efficiency, would constitute presumptive connecting factors.

If the plaintiff shows there is a presumptive connecting factor, then

32 Claims Canada

p30-32 CROSS BORDER 2.indd 32

June/July 2012

to rebut the presumption of jurisdiction the defendant must show that the presumptive connecting factor does not point to any real relationship between the subject matter of the litigation and the forum, or that the relationship is weak. For example, if the connecting presumptive factor is that the defendant carries on business in the forum, the defendant should show that the subject matter of the litiga-

Differences in the laws between the home jurisdiction and the jurisdiction to which the defendants want the case transferred are often an important factor in the forum non conveniens analysis. tion is unrelated to the defendant’s business there.

The second change is to more clearly separate and distinguish the real and substantial connection test from the discretionary forum non conveniens analysis as to whether the court should decline jurisdiction in favour of another court elsewhere. The court

may consider forum non conveniens only after having first determined it has jurisdiction, and then only if the defendant invokes forum non conveniens.

The defendant has the burden to show another forum is clearly more appropriate. He must show a presumptive connecting factor connecting the subject matter of the litigation to the other forum, then must show that forum is clearly more appropriate, based on the factors mentioned above and others. Probably the defendant’s insurance or lack thereof will be considered here, rather than as part of the real and substantial connection issue.

Differences in the laws between the home jurisdiction and the jurisdiction to which the defendants want the case transferred are often an important factor in the forum non conveniens analysis. For example, the plaintiffs in Van Breda would not be entitled to statutory family law benefits if Cuban law applied. However, the Supreme Court rightly pointed out that letting the case proceed in Ontario does not necessarily mean that Ontario law will apply. As well, differences that are an advantage for one side are a disadvantage for the opposing side. Accordingly, the Court cautioned against giving much weight to such differences in the forum non conveniens analysis.

All in all, the decision helps a little to clarify when courts will assume jurisdiction. But it remains to be seen what new connecting factors will be recognized, and what is needed to rebut the presumption.  Ken MacDonald is a partner with Henry K. Hui & Associates. His practice focuses on commercial and general civil litigation with expertise in cross border cases. The foregoing provides general information only and is not legal advice; readers should contact counsel for advice tailored to their particular situation.

www.claimscanada.ca

27/06/12 12:26 PM

National Standing Committees 2011-2012 ADVISORY Delores Thorbourne, BA, FCIP, CRM Granite Claims Solutions Suite 103 Greystone VII 4208 - 97 Street Edmonton, AB T6E 5Z9 Phone: (780) 442-3077 Fax: (780) 466-0325 E-mail: delores.thorbourne@ graniteclaims.com John D. Seyler, AIIC ProFormance Group 5080 Timberlea Blvd., Suite 214 Mississauga, ON L4W 4M2 Phone: (905) 238-4985 Fax: (905) 238-2735 E-mail: jseyler@prospecialty.ca

John M. Sharoun, FIIC, CFE, FCIAA Crawford & Company (Canada) Inc. 300 – 123 Front Street West Toronto, ON M5J 2M2 Phone: (416) 867-1188 Fax: (416) 867-1925 E-mail: John.Sharoun@crawco.ca

CONVENTION Karen Kuronen, CIP, Dip. Mech. Eng. Arctic West Adjusters Ltd. 401 – 5204 – 50 Ave. Yellowknife, NT X1A 1E2 Phone: (867) 920-2212 Fax: (867) 873-2244 E-mail: kkuronen@arcticwest.ca

Dennis N. Schembri, CIP, CFEI Granite Global Solutions 133 King Street East, 3rd Floor Toronto, ON M5C 1G6 Phone: (647) 789-2438 Fax: (647) 789-2449 E-mail: dennis.schembri@graniteglobalsolutions.com

DESIGNATION Paul W. Greening, CLA, FCIAA Greening Aviation Claims Inc. 26C Palliser Park, Box 190 Riverhurst, SK S0H 3P0 Phone: (306) 353-2000 Fax: (306) 353-2200 E-mail: pgreening@sasktel.net

Mary Charman, CIP Crawford & Company (Canada) Inc. 1 – 120 Mulock Drive Newmarket, ON L3Y 7C5 Phone: (905) 898-0008 Fax: (905) 898-1705 E-mail: Mary.Charman@crawco.ca

Jo-Ann Eccleston, CIP Aviva Canada Inc. 2206 Eglinton Ave. East Toronto, ON M1L 4S8 Phone: (416) 689-3328 Fax: 1-866-805-8585 E-mail: jo-ann_eccleston@avivacanada.com

James B. Eso, BA, CIP Crawford & Company (Canada) Inc. 539 Riverbend Drive Kitchener, ON N2K 3S3 Phone: (519) 578-5540 Fax: (519) 578-2868 E-mail: Jim.Eso@crawco.ca

Bob Grouchy, BA, FCIP, CRM Allianz Global 1600 – 130 Adelaide Street West Toronto, ON M5H 3P5 Phone: (416) 915-4247 Fax: (416) 849-4555 E-mail: bob.grouchy@agr.allianz.ca

John Jones, BA Granite Claims Solutions Suite 300, 5915 Airport Road Mississauga, ON L4V 1T1 Phone: (905) 671-3164 Fax: (905) 671-1889 E-mail: john.jones@graniteclaims. com

Carol Jardine, FCIP, CRM TD Insurance 2161 Yonge Street, 4th Floor Toronto, ON M4S 3A6 Phone: (416) 486-2507 Fax: (416) 545-6022 E-mail: Carol.Jardine@tdinsurance.com

Craig J. Walker, CIP, FCIAA, FIFAA Maltman Group International 3550 Victoria Park Ave., Suite 301 Toronto, ON M2H 2N5 Phone: (416) 492-4411 Fax: (416) 492-5657 E-mail: cwalker@maltmans.com

Justin J. MacGregor Martin Merry & Reid Limited 3 Church Street, Suite 404 Toronto, ON M5E 1M2 Phone: (416) 366-3333 Fax: (416) 366-0730 E-mail: jmacgregor@mmr.ca

CIAA NATIONAL INSURANCE INDUSTRY ADVISORY BOARD Patti M. Kernaghan, FCIP, CRM Kernaghan Adjusters Limited 300 - 1575 West Georgia Street Vancouver, BC V6G 2V3 Phone: 1-800-387-5677 Fax: 1-800-387-5644 E-mail: pkernaghan@kernaghan.com

Mark Stewardson, FCIP Royal & SunAlliance 2225 Erin Mills Parkway, Suite 1000 Mississauga, ON L5K 2S9 Phone: (905) 403-2333 Fax: (905) 403-2326 E-mail: Mark.Stewardson@ rsagroup.ca

Greg G. Merrithew, CIP, FIFAA Arctic West Adjusters Ltd. 401 – 5204 – 50 Ave. Yellowknife, NT X1A 1E2 Phone: (867) 920-2212 Fax: (867) 873-2244 E-mail: gregm@arcticwest.ca Delores Thorbourne, BA, FCIP Granite Claims Solutions Suite 103 Greystone VII 4208 - 97 Street Edmonton, AB T6E 5Z9 Phone: (780) 442-3077 Fax: (780) 466-0325 E-mail: delores.thorbourne@ graniteclaims.com Mary Charman, CIP Crawford & Company (Canada) Inc. 1 – 120 Mulock Drive Newmarket, ON L3Y 7C5 Phone: (905) 898-0008 Fax: (905) 898-1705 E-mail: Mary.Charman@crawco.ca Craig J. Walker, CIP, FCIAA, FIFAA Maltman Group International 3550 Victoria Park Ave., Suite 301 Toronto, ON M2H 2N5 Phone: (416) 492-4411 Fax: (416) 492-5657 E-mail: cwalker@maltmans.com Patricia M. Battle Canadian Independent Adjusters’ Association/L’Association Canadienne des Experts Indépendants 5401 Eglinton Ave. West, Suite 100 Etobicoke, ON M9C 5K6 Phone: (416) 621-6222 Toll Free: 1-877-255-5589 Fax: (416) 621-7776 E-mail: pbattle@ciaa-adjusters.ca

www.claimscanada.ca

p33 CIAA NSC.indd 33

Mark Weir Intact Financial Corporation 700 University Avenue, 13th Floor Toronto, ON M5G 0A1 Phone: (416) 341-1464 Fax: (416) 217-0562 E-mail: mark.weir@intact.net Peggy Wong, CIP The Economical Insurance Group 111 Westmount Road South Waterloo, ON N2J 4S4 Phone: (519) 570-8500 Fax: (519) 570-8690 E-mail: Peggy.Wong@teig.com CAREER RECRUITMENT PLANNING Richard Swierczynski, BA, CIP AZ Claims Services Inc. 1500 Upper Middle Rd., Unit #3 P.O. Box 76041 Oakville, ON L6M 3G3 Phone: (905) 825-0027 Fax: (905) 825-5543 E-mail: Richard@azclaims.ca COMMUNICATIONS Teresa Mitchell, FCIP, CRM, FCLA, FCIAA, FIFAA Crawford & Company (Canada) Inc. 14 – 431 Bayview Drive Barrie, ON L4N 8Y2 Phone: (705) 728-5597 Fax: (705) 728-2167 E-mail: Teresa.Mitchell@crawco.ca CONSTITUTION & RULES John Jones, BA Granite Claims Solutions Suite 300, 5915 Airport Road Mississauga, ON L4V 1T1 Phone: (905) 671-3164 Fax: (905) 671-1889 E-mail: john.jones@graniteclaims.com

E. Brian Gough, FCIP, CLA, FCIAA Marsh Adjustment Bureau Limited 1550 Bedford Highway, Suite 711 Bedford, NS B4A 1E6 Phone: (902) 469-3537 Fax: (902) 469-2396 E-mail: ebgough@marshadj.com Robert V. Pearson, CLA, FCIAA LSW & Associates Ltd. 2424 4 Street S.W., Suite 600 Calgary, AB T2S 2T4 Phone: (403) 452-2195 Fax: (403) 452-3568 E-mail: rvp@lswadjusters.com DISCIPLINE Mary Charman, CIP Crawford & Company (Canada) Inc. 1 – 120 Mulock Drive Newmarket, ON L3Y 7C5 Phone: (905) 898-0008 Fax: (905) 898-1705 E-mail: Mary.Charman@crawco.ca EDITORIAL Fred Silvestri, BA, CIP Sedgwick CMS Canada Inc. 21 Four Seasons Place, Suite 100 Toronto, ON M9B 6J8 Phone: (416) 695-5100 Fax: (416) 695-5120 E-mail: fred.silvestri@sedgwickcms.ca John M. Sharoun, FIIC, CFE, FCIAA Crawford & Company (Canada) Inc. 300 – 123 Front Street West Toronto, ON M5J 2M2 Phone: (416) 867-1188 Fax: (416) 867-1925 E-mail: John.Sharoun@crawco.ca Mary Charman, CIP Crawford & Company (Canada) Inc. 1 – 120 Mulock Drive Newmarket, ON L3Y 7C5 Phone: (905) 898-0008 Fax: (905) 898-1705 E-mail: Mary.Charman@crawco.ca EDUCATION Santo Carbone, CRM, FCIAA Crawford & Company (Canada) Inc. 300-123 Front Street West Toronto, ON M5J 2M2 Phone: (416) 364-6341 Fax: (416) 435-0546 E-mail: Santo.Carbone@crawco.ca EMERGENCY MEASURES Richard Van Horne Action Investigations Inc. 2 Catelina Court Dartmouth, NS B2X 3G9 Phone: (902) 462- 1222 Fax: (902) 462-3688 E-mail: richardvanhorne@actioninvestigations.ca FINANCE Randy P. LaBrash, CIP, CFE, CFEI Crawford & Company (Canada) Inc. 300 – 191 Lombard Avenue Winnipeg, MB R3B 0X1 Phone: (204) 947-2340 Fax: (204) 943-9168 E-mail: Randy.Labrash@crawco.ca Greg G. Merrithew, CIP, FIFAA Arctic West Adjusters Ltd. 401 – 5204 – 50 Ave. Yellowknife, NT X1A 1E2 Phone: (867) 920-2212 Fax: (867) 873-2244 E-mail: gregm@arcticwest.ca

Mary Charman, CIP Crawford & Company (Canada) Inc. 1 – 120 Mulock Drive Newmarket, ON L3Y 7C5 Phone: (905) 898-0008 Fax: (905) 898-1705 E-mail: Mary.Charman@crawco.ca IBC: LIAISON, LEGISLATIVE & FORMS Paul Hancock, B.Sc., CIP Crawford & Company (Canada) Inc. 300 – 123 Front Street West Toronto, ON M5J 2M2 Phone: (416) 867-1188 Fax: (416) 867-1925 E-mail: Paul.Hancock@crawco.ca LICENSING J. Miles O. Barber, B.Comm. (Hons.), FCIP, CRM Network Adjusters Ltd. 67 Folkestone Blvd.

Winnipeg, MB R3P 0B4 Phone: (204) 897-5793 Fax: (204) 897-5797 E-mail: mbarber@mts.net MEMBERSHIP & QUALIFICATIONS Georgiana Chen, CIP ProFormance Group Inc. 1101 Kingston Rd., Suite 280 Pickering, ON L1V 1B5 Phone: (877) 539-3111 Fax: (905) 554-3776 E-mail: gchen@proadjusting.ca NOMINATING Mary Charman, CIP Crawford & Company (Canada) Inc. 1 – 120 Mulock Drive Newmarket, ON L3Y 7C5 Phone: (905) 898-0008 Fax: (905) 898-1705 E-mail: Mary.Charman@crawco.ca Greg G. Merrithew, CIP, FIFAA Arctic West Adjusters Ltd. 401 – 5204 – 50 Ave. Yellowknife, NT X1A 1E2 Phone: (867) 920-2212 Fax: (867) 873-2244 E-mail: gregm@arcticwest.ca James B. Eso, BA, CIP Crawford & Company (Canada) Inc. 539 Riverbend Drive Kitchener, ON N2K 3S3 Phone: (519) 578-5540 Fax: (519) 578-2868 E-mail: Jim.Eso@crawco.ca Craig J. Walker, CIP, FCIAA, FIFAA Maltman Group International 3550 Victoria Park Ave., Suite 301 Toronto, ON M2H 2N5 Phone: (416) 492-4411 Fax: (416) 492-5657 E-mail: cwalker@maltmans.com PRIVACY James B. Eso, BA, CIP Crawford & Company (Canada) Inc. 539 Riverbend Drive Kitchener, ON N2K 3S3 Phone: (519) 578-5540 Fax: (519) 578-2868 E-mail: Jim.Eso@crawco.ca Keith P. Edwards, FCILA, CLA, FUEDI-ELAE CIAA Honorary Life Member c/o CIAA National Office 5401 Eglinton Ave. W., Suite 100 Etobicoke, ON M9C 5K6 Phone: (416) 621-6222 Fax: (416) 621-7776 E-mail: info@ciaa-adjusters.ca

CIAA REGIONAL PRESIDENTS 2011 – 2012 NEWFOUNDLAND & LABRADOR Marcel Pitcher, CIP, CRM Crawford & Company (Canada) Inc. 300 – 44 Torbay Road St. John’s, NL AlA 2G4 Phone: (709) 753-6351 Fax: (709) 753-6129 E-mail: Marcel.Pitcher@crawco.ca NOVA SCOTIA E. Grant King, BA, B.Ed., CIP Crawford & Company (Canada) Inc. 120 – 237 Brownlow Avenue Dartmouth, NS B3B 2C7 Phone: (902) 468-7787 Fax: (902) 468-5822 E-mail: Grant.King@crawco.ca NEW BRUNSWICK & PRINCE EDWARD ISLAND Luc Aucoin, BBA, FCIP Plant Hope Adjusters Ltd. 85 Englehart Street Dieppe, NB E1A 8K2 Phone: (506) 853-8500 Fax: (506) 853-8501 E-mail: laucoin@planthope.com QUEBEC/AESIQ Elaine Savard, LL.B., FPAA Les Expertises Richard Racette 1090, rue Principale Sainte-Agathe des Monts, PQ J8C 1L6 Phone: (819) 326-0012 Fax: (819) 326-2023 E-mail: elaine.savard@exprr.ca ONTARIO Teresa Mitchell, FCIP, CRM, FCLA, FCIAA, FIFAA Crawford & Company (Canada) Inc. 14 – 431 Bayview Drive Barrie, ON L4N 8Y2 Phone: (705) 728-5597 Fax: (705) 728-2167 E-mail: Teresa.Mitchell@crawco.ca MANITOBA Timothy W. Bromley J.P. Hamilton Adjusters Ltd. 125 Enfield Crescent Winnipeg, MB R2H 1A8 Phone: (204) 944-1057 Fax: (204) 944-1606 E-mail: tbromley@mts.net SASKATCHEWAN Lee Dixon Midwest Claims Services Box 37006 North Park PO Saskatoon, SK S4P 2R6 Phone: (306) 361-5285 Fax: (306) 249-4114 E-mail: lee@midwestclaims.ca WESTERN Russell Fitzgerald, CIP Kernaghan Adjusters Limited 203 – 4246 97 Street N.W. Edmonton, AB T6E 5Z9 Phone: (780) 488-2371 Fax: (780) 488-0243 E-mail: rfitzgerald@kernaghan.com PACIFIC David Porter, LL.B., FCIP, CRM Granite Claims Solutions 206 - 2323 Boundary Road Vancouver, BC V5M 4V8 Phone: (604) 642-0660 Fax: 1-888-452-5246 E-mail: david.porter@graniteclaims.com

June/July 2012

Claims Canada 33

27/06/12 1:14 PM

BY DONNA INCE

It started out as just another quiet April day in Wellington, Ontario, but how quickly things can change. A fire ripped through a meat processing plant leaving behind nothing more than a pile of rubble and an uncertain future for a company and the 34 Claims Canada

p34-36 RSA.indd 34

June/July 2012

dozens of people in a small community who depended on it.

It’s the call every insurer and broker dreads – a total loss fire that leaves customers reeling with the difficult question: “Now what?”

When the flames were finally extinguished, it was clear that there was millions of dollars in damages and 150 people out of a job. Employees who had

evacuated the building stared in disbelief, some in tears, as the building that many had spent much of their careers in, was reduced to a mountain of ash.

Scott Willard, who co-owns the Canada First Brands (CFB) plant with his brother Dale, told us he was in total shock when he got a call from one of his employees that the plant was burning down. www.claimscanada.ca

27/06/12 1:19 PM

“I was getting the blow by blow on the phone of them trying to put out the fire and people were screaming, ‘Oh no…..’” he told us afterwards. “That was on a Sunday and all we could think of is, what’s going to happen Monday?

What happens now?”

It’s during these difficult moments, when the people we insure feel lost and vulnerable, that is the most powerful moment for insurers, when we get to do what we do best – keep our customers moving.

There are many considerations and many players involved in handling a claim of this magnitude and we knew that it was critical for us to spring into action immediately.

The morning after the fire, the plant’s broker Mark Sampson, vice president of CG&B Group Inc., had just returned to work after undergoing major knee surgery. He received the devastating news from Dale Willard and headed right to his car, driving several hours to the plant to survey the damage and meet with the owners.

The Willards had never been in a situation like this before. They were at a loss of what to do next and Mark’s first priority was going over their policy with them and providing assurance that they had the proper insurance coverage in place.

In terms of a risk, the plant wasn’t overly complicated. But there were things RSA needed to carefully consider during the underwriting, such as the fact it was situated right in the middle of a residential and school area.

The fear is always that if the plant were to ever catch fire, it could spread to neighbouring areas, which thankfully didn’t happen.

By all accounts, the plant was what we would consider a good risk. They were properly certified and had controls in place to mitigate risk. They were a federally inspected, HACCPapproved facility. They had done all the right things. But that’s the purpose of insurance – it covers you when the unexpected and unimaginable happens.

When our adjusters arrived on the scene, it was clear this was going to be a significant claim. Not only did it involve the destruction of an entire www.claimscanada.ca

p34-36 RSA.indd 35

manufacturing plant, it also impacted other operations for the owners.

The adjuster’s first line of business was to conduct an immediate assessment of the damage and to go over the claims process with the Willards, while letting them know who would be involved. The constant flow of people at the site – including health inspectors, appraisers and demolition contractors – could be overwhelming and we wanted to ensure they were properly prepared. Given that this was a

meat processing plant, there were special considerations that had to be made due to the risk of contamination. Also because of its proximity to a residential area and school, the entire site needed to be secured to prevent liability risks.

It was soon apparent that nothing in the plant was salvageable; the adjuster began the significant task of pricing all the items. He looked at the equipment – from large machinery right down to the hairnets worn by the workers – the products and inventory,

Coming Through For You!

THE PROPERTY RESTORATION SPECIALISTS WITH SERVICE LOCATIONS ACROSS CANADA

24 HOUR ASSIGNMENT/EMERGENCY RESPONSE TOLL FREE 1-866-4-WINMAR (494-6627) Proud to be Canadian owned and operated.

For more information visit www.winmar.ca

June/July 2012

Claims Canada 35

27/06/12 1:19 PM

APPOINTMENT

Craig Harris Paul Aquino, Publisher, Claims Canada magazine (claimscanada.ca), is pleased to announce the appointment of Craig Harris for a one-year term to the position of Editor of Claims Canada magazine.

got estimates and hired an accountant to begin conducting business interruption calculations.

The monetary value of the claim was much higher than the typical claim we receive, but this had no bearing on the adjustment of the loss. It also helped that we were working with extremely cooperative and pro-active customers.

Everyone worked together: broker Mark Sampson, the underwriter, the RSA Claims team, the independent adjuster, the vendors and the Willards – with the key goal of ensuring the company didn’t fall into bankruptcy.

Getting the Willards a partial pay-

sense for their business was to consolidate with an existing plant they had in Trenton and this freedom allowed them to not just rebuild but to reinvent themselves.

In the end it took just over two years to get the new operation up and running in the Willards’ existing plant in Trenton. With their claims settlement, CFB has added a line of premium meat products to their existing business, selling to major Canadian and international retailers. They have exceeded sales expectations by 37% and grown their team by 40%, while providing economic stimulus in their new location.

ment cheque right away was crucial to ensure they were able to cover ongoing expenses, move some operations to a neighbouring plant they owned and keep the business afloat while the claims process took place. At RSA we always talk about our Hassle Free Claims Service and this was a critical moment to ensure we were living up to that promise.

Part of removing that hassle also came from the flexibility within their policy. They had a broad insurance program, which gave them the flexibility to implement a plan that was right for their business. Because their Replacement Cost coverage had the Same Site clause removed, they had several options about how they wanted to move forward. They could take the claims payout and not rebuild the plant; they could rebuild the plant in its current location if local authorities allowed; or they could rebuild elsewhere. What they decided made most

This was a claim that really hit home for both the broker and RSA because it was a family-run business.

So when we all went to visit the new gleaming operation in Trenton, two years after the fire, we felt a great sense of pride and attachment to what had been accomplished.

The Willards have been quite candid about the fact that without insurance they would be out of business.

Employees would be out of a job and the Ontario economy would have lost a world-class meat processing facility.

For RSA, this was an opportunity to help build a new beginning for a strong company and the people who depend on them. It also reinforced the power of partnership with our broker and the invaluable role of insurance in keeping our customers and businesses moving. 

With a Master’s Degree in Journalism from Carleton University, Craig brings more than 20 years of business reporting experience in the insurance and financial services industry to Claims Canada. He has edited several industry trade journals and currently operates a freelance writing and editing business, Edit Insight Ltd. He has won more than eight industry awards for his business journalism, including four KRW awards.

Published bi-monthly by the Canadian Underwriter magazine – Insurance Media Group, Claims Canada magazine is the Official Journal of the Canadian Independent Adjusters’ Association (CIAA). Through its editorial content and circulation, Claims Canada brings together the entire property & casualty insurance claims market nationally with information and insight into the profession, business and people of insurance claims and loss adjusting.

The Canadian Underwriter group of insurance industry media products has grown and developed to cover a wide range of information vehicles, both in print and online. Canadian Underwriter’s Insurance Media Group is committed to providing the most timely and relevant news, information and resources to insurance professionals from all segments of the property and casualty insurance market.

INSURANCE MEDIA GROUP www.insurancemediagroup.com 36 Claims Canada

p34-36 RSA.indd 36

June/July 2012

Donna Ince is vice president, Ontario Region, RSA Canada. www.claimscanada.ca

27/06/12 1:20 PM

速

SERVICEMASTER.indd 1

20/06/12 10:44 AM

Avoid the

Ambush!

Self-Defense for Insurers

BY CAROLINE L. MEYER

Picture it: on the eve of a Financial Services Commission arbitration, a medical report on behalf the insured is delivered, one that introduces new medical opinions supporting the insured’s position. In fact, the report appears to introduce new evidence supporting a new medical position, and lands with a thud on the insurer’s lap.

Insurers need not fear such an ambush, as defences are strengthened by a recent decision of the Ontario Divisional Court in Certas Direct Insurance Company v. Gonsalves (2011 ONSC 3986).

In Gonsalves, the insured sought and was denied caregiver benefits pursuant to the test established for post-104 weeks. An arbitration was scheduled. One month prior to the commencement of the arbitration, two new orthopaedic opinions were delivered on behalf of the insured. These opinions supported the insured’s position and were found to include a new diagnosis. The insurer rallied and ob38 Claims Canada

p38-39 MEYER.indd 38

June/July 2012

tained an adjournment and an Order for the insured to attend a section 42 assessment.

To determine the reasonable necessity of the insurer’s request for examinations, the Arbitrator relied upon the factors found in prevailing arbitral authority, including: the timing of the request; whether the insurer made its insurer examination request as soon as it reasonably determined the need for the examination; what other information was available to the insurer; whether information provided by the claimant since the insurer’s last insurer examination suggested a new diagnosis, a change in the claimant’s condition or a new direction in medical investigation of it; and whether there was a reasonable nexus between the requested examination and the insured person’s injuries, among other factors.

Despite the Arbitrator’s Order, the insured would not be thwarted and continued to refuse to attend the section 42 orthopaedic assessments.

When the Director’s Delegate reversed the arbitrator’s Order, the insurer applied for judicial review.

The Divisional Court saw the insured’s reports for what they were: trial by ambush! The Court noted that fundamental to any administrative process is the requirement that it be fair. At its most basic, procedural fairness required that a party have an opportunity to be heard and that it be able to respond to the position taken against it.

In Gonsalves, the Court specifically held that it was not enough to say that the delivery of the reports was made within the permitted time frame (in this case, one day before the last day the Code, clause 39.1 says is acceptable) when those reports provided new evidence supporting a new position.

The Court relied on the tenet of procedural fairness to find that the insurer would be denied the right to make a full response if the insurer orthopaedic assessment did not take place. The Court ordered the insured to attend the assessment and ordered costs payable by the insured in the amount of $10,000.00.

The Gonsalves decision was invoked as a self- defence mechanism for the inwww.claimscanada.ca

27/06/12 1:31 PM

ness analysis is keeping with previous surer in the decision of Kostynyk shame on him.

Onrecent the other hand, we and State Farm Mutual Insurance Com- arbitral decisions, Gonsalves appears could provide all of the information, Many years ago, I was told pany (FSCO A09-003158, 28 Sept. to place more significant weight upon warts and all. I was then told that if I aspectperson of the request as a 2011). In that case, the insurer assessed thatthe anfairness unethical was notthe prepared to provide all of the insured for caregiver benefits, prior determinative factor. was one who stole money. information, should employment Indeed, Kostynyk, in adopting the to theI 104 weekseek point.

Post 104 weeks, elsewhere. in was Gonsalves, reflects an Thatreasoning definition just as the insured obtained her own reports, Whendetermining we considerhertheentitlement lessons from overriding concern with fairness.

In for careinadequate then as itwhere is now. the arbitral process, insurers Enron, Lehman Brothers, the sub-prime giver benefits and subsequently refused fiasco and so many similar situationsto de- are at a disadvantage, deprived of curto attend section 42 assessments termine caregiver in entitlement that have beenherprevalent recent be- rent knowledge as to the insured’s ofyond times, we have104 to weeks. wonderArbitrator if there isRogers any re- ten evolving condition, treatment, and lied on to define the insurer’s such thing asGonsalves a concept of business right to assessments under ethics. But when we consider theSection con- 42.

Arbitrator Rogers found sequences of these activities, we havethat to the insurer’s assessments were reasonable realize we cannot survive without a and necessary, as Gonsalves established clear concept of what is acceptable and that an insurer has a prima facie right what is not.

medicalOF investigations, FUTURE INTEGRITYGonsalves goes a ways towards levelling the playing Paul Griffith, Humber College field when there is an attempt to am-

A changing business environment doesbush. n’t have to translate into changing values or a different understanding of Caroline L. Meyer is a lawyer with what is Thomson right andLLP. wrong.

During inthe Miller Her practice past decades, weinsurers have experienced volves defending in first and third party claims. previtransformations in Caroline businesswas methodously involved in a very different line of ologies, technology, rules, regulations, defence work: defending death row inmates in Texas. 

“GeT all THe rIGHT cOnnecTIOnS!”

to require an insured person to be assessed upon a change in the test GREAT for TRADITION OF The Arbitration reentitlement.

MENTORING lied on three principles distilled from BradleyGonsalves: Wells, Blaney 1.

McMurtry Fairness LLP is fundamental to any adOver the past few decades, a push has ministrative process.

Procedural fairness party be able been underway torequires changethat theapercepresponse to the decision tion of thetoinsurance industry from ataken it; Associations and process to aagainst profession.

2. Aorganizations Section 42 assessment may be reregulating offer continuquired in order to have a fair hearing education programs and designaing; and tions for achievement (i.e. CIP, FCIP, 3. A change in circumstances, such as CAIB, CRM), which add more depth to a change in the test for entitlement, the industry’s long-held principles of gives an insurer prima facie right to professionalism. is evidence requireThis an insured personofto abe asshift in thesessed. multigenerational self-perception ofArbitrator the insurance as arRogersindustry, stayed the well as an outwardpending indication of a moreattenbitration Kostynyk’s structured professional education. dance at the proposed assessments.

Arbitrator concluded that The industry hasRogers a great tradition of if the hearing were to proceed without mentoring. Even as the most senior the opinionsretire fromfrom the proposed assessprofessionals the workments, would have the unforce, there is the no insured reason this tradition fair advantage being able to rely on the cannot continue. Just as today’s senior opinions from her own assessments, professionals learned from the previ- to which the insurer would not be able to ous generation, they must be encourrespond. aged to pass their knowledge down to This line of decision-making prothe newvides generation of tool professionals. a practical for insurers, to And as the ranks of junior professiondefend against trial by ambush in the als gainaccident knowledge and experience, benefits arena.

The approach they are no that longer They beis one relies“junior.” upon the insurer should ing be encouraged to participate able to adequately illustrate circumstances that would lead conto unfairin the mentoring process, thereby the insurer were tinuing ness the ifexisting cycle ondeprived its end-of the opportunity to respond by way of secless loop. tion 42 assessments. While this fairwww.claimscanada.ca

p38-39 MEYER.indd 39

2012

Ontario Insurance Directory This outstanding directory is your personal address and telephone book dedicated solely to the Ontario Insurance Industry… find the company contacts you need immediately!

Used on a daily basis by all segments of the Industry — the O.I.D. is the Undisputed Source for Insurance professionals to make contact with companies quickly and easily.

The coil bound O.I.D. contains: • 400+ pages of information • 2,200+ company listings

• 130+ advertisers • 12 key industry sections:

• Insurance Companies / Wholesalers • Lawyers / Dispute Resolution • Brokers • Engineers / Accountants • Independent Adjusters • Bodyshops / Collision Repair • Appraisers • Automotive Recyclers • Rehabilitation Services • Insurance Industry Associations • Restoration Services • Industry Suppliers Guide 2012 Ontario Insurance Directory: $59.00 each (plus $5.00 Shipping & Handling plus applicable taxes)

Call now to order

1-800-668-2374 Or order online @

Completely Updated for 2012 - over 10,000 changes!

www.bit.ly/oidorder

November 2011 Canadian Underwriter

June/July 2012

45 Claims Canada 39

27/06/12 1:31 PM

EF

• education forum

A SERIES OF ARTICLES PROVIDED BY THE INSURANCE INSTITUTE OF CANADA

Calling for Coverage!

Cell Phones and the CGL Policy

I

n the last issue, Education Forum looked at key scientific and legal findings on the potential health risks posed by cell phone use. In this article, we look at some of the insurance issues triggered by claims related to the electromagnetic fields (EMF) emitted by cell phones.

Much of the case law in this area comes from south of the border.

Courts in the US have considered the issue of an insurer’s duty to defend in cases based on claims of injury related to cell phone use; and have also considered claims to recover the costs of medical monitoring to detect and prevent future illness.

Insurer’s duty to defend Some US courts have concluded that an insurer has no duty to defend in cases involving claims of injury at the cellular level allegedly related to cell phone EMF emissions. But others have concluded that allegations of harm at a biological or cellular level do constitute “bodily injury” and trigger CGL policy defence obligations. The dissenting and majority judgments from the Supreme Court of Texas in Nokia, Inc. v. Zurich American Insurance Co. (2008) illustrate the differing views on the question.

In the Nokia v. Zurich, class actions were brought against Nokia seeking damages for alleged biological injury from exposure to radiation emitted by cell phones that Nokia manufactured.

40 Claims Canada

p40-41 EDUCATION FORUM.indd 40

June/July 2012

Nokia tendered defence in one of the cases to Zurich American Insurance under its CGL policies. Zurich agreed to defend, but reserved the right to contest its obligations later and ultimately sought a declaration that it had no duty to defend or indemnify Nokia.

At the Texas Supreme Court, Zurich argued it had no duty to defend because the complaints in the underlying cases did not state claims for bodily injury or seek damages because of bodily injury – the plaintiffs’ complaints used the phrase “biological injury” rather than the term “bodily injury”.

The majority decision of the court concluded that the injuries alleged by the plaintiffs did potentially qualify as bodily injuries under the policies, and drew a parallel to claims for subclinical injuries resulting from exposure to asbestos. The majority also found that, although the class-action plaintiffs

were seeking compensation for the cost of headsets, they were also asserting injury and claiming damages for physical exposure to radiation.

By contrast, the two justices who dissented agreed with the insurance company’s argument that none of the damages sought were “because of” bodily injury. According to the dissent, the plaintiffs claimed for headsets or their value (on the grounds that using cell phones without headsets could potentially cause bodily injury because of EMF), but they did not explicitly claim for personal injury damages.

Medical monitoring claims Some US class action suits alleging radiofrequency radiation exposure have included claims for medical monitoring, to recover the cost of testing to detect and prevent possible illness.

This kind of claim is often made when

Cell phone precautions The evidence on the health risks of cell phone use remains uncertain, but here are few tips for keeping on the safe side: • When choosing a cell phone, look for one with a low SAR rating – the lower the better.

• When you’re not using your phone, keep it turned off. A cell phone emits EMF only when it’s turned on.

• Use the phone only where you get a strong signal. The better the signal reception, the lower the power the phone transmits at.

• When using the phone, the farther you can keep it from your head, the better.

Texting or using a hands-free device involves less exposure to EMF.

www.claimscanada.ca

27/06/12 1:37 PM

someone has been exposed to high levels of a substance that is known to increase the likelihood of illness.

Such claims raise questions about whether, and to what extent, they might fall within a CGL policy’s defence or indemnity obligations. The answer hinges on three issues: • whether the claim alleges “bodily injury” within the scope of the coverage • whether the injury occurred during the policy period • whether the claim is for damages that the policyholder is obligated to pay Most US courts seem to have concluded that claims of harm at a biological or cellular level resulting from cell phone use do satisfy the bodily injury requirement, and that insurers therefore have a defence obligation.

However, it is not yet clear whether the bodily injury involved in medical monitoring claims is sufficient to trigger coverage.

The issue of whether or not the injury occurred during the policy period is especially tricky because medical monitoring claims are made before the illness has materialized. Whether claims for medical monitoring constitute damages typically centres on whether “damages” refers to legal damages only or whether it also covers other relief. Courts have come to different conclusions on this.

In Canada, although most health care is government-funded, claims for medical monitoring have been made on various grounds, including the fact that provincial health care plans may be subrogees, that certain services and treatments are not covered by provincial health care plans, and that there is a risk that some services may not be government-funded in the future.

Analogies to asbestos As discussed in the last Education Forum article, definitive scientific evidence of a connection between cell phone use and cancer is not yet available. If a definitive link is eventually confirmed, the injuries may not emerge until years after the exposure, and insurers could face significant growth in claims for a previously unwww.claimscanada.ca

p40-41 EDUCATION FORUM.indd 41

derestimated risk. In this sense, cell phone claims could prove similar to asbestos claims.

Yet brain cancer can also be attributed to other causes and exposures.

Establishing a direct link to cell phone use in a given claim would be more difficult than is the case with asbestos and mesothelioma, where most cases of the disease can be traced back to asbestos exposure.

Although the scientific evidence is currently confusing and contradictory, some underwriters are adopting a cautious approach, seeking to limit their exposure to a potentially uncontrollable and unpredictable risk.

Apportioning liability could also be difficult, since a claimant might have used different cell phones at different times. Apportioning liability has come up in asbestos cases where claimants might have been exposed to asbestos in more than one workplace. Some employers were found jointly and sev-

erally liable; others were found severally liable but not jointly liable.

Another issue in asbestos cases that is also likely to arise in EMF cases is the question of when the insurance contract is triggered. To decide this, courts may have to determine when a claimant is considered to have sustained the illness, which the asbestos cases show can be difficult.

The Canadian context If a product liability action were brought in Canada against a business in the cell phone supply chain – a manufacturer, cell phone service provider, cell phone retailer, etc. – it’s likely the business would look to its CGL policy, as most such policies cover product liability.

There is anecdotal evidence that some Canadian underwriters take EMF risks into account when providing CGL quotes, and some even include specific exclusions for EMFrelated risks. Although the scientific evidence is currently confusing and contradictory, such underwriters are adopting a cautious approach, seeking to limit their exposure to a potentially uncontrollable and unpredictable risk.

Other Canadian underwriters take the line that, given the current scientific evidence related to EMF, at this point there is no quantifiable exposure to take into account.

Finally, even if there is no consensus regarding product liability exposure for EMF emitted by cell phones, some companies in the cell phone business are already looking to insure against the possible risk, and some insurance products – whether specialty products or CGL policies without exclusions – are potentially available to protect them.  This article is based on excerpts from ADVANTAGE Monthly, a series of topical papers on emerging trends and issues provided to members of the CIP Society.

The Chartered Insurance Professionals’ (CIP) Society is the professional organization representing more than 15,000 graduates of the Insurance Institute’s Fellow Chartered Insurance Professional (FCIP) and Chartered Insurance Professional (CIP) programs.

June/July 2012

Claims Canada 41

27/06/12 1:37 PM

• on the scene OTS Each year, CICMA’s New Brunswick chapter makes donations to three charities for $2,500 each.

Grant King, CIAA Nova Scotia Region President, presenting a cheque to Gilberte Theriault of the Nova Sco-

Stephen Robb, CICMA New Brunswick chapter president, made the presentation to a representative from Harvest House in Moncton. l

Chapter member Jeff Rideout presents to a representative from Laubach Literacy in Fredericton. l

tia Insurance Women’s Association. l

CIAA New Members — March 2012 INDIVIDUAL MEMBERSHIP Crawford & Company (Canada) Inc. Jed Muir, BA, CIP Calgary, AB Neil Randall Winnipeg, MB Tammie Ryan Mississauga, ON Don Baxter Toronto, ON

Chapter member Rick Cicin presenting CICMA’s donation to Sandy Johnson from Hospice Greater Saint John. l

Walter Tingley of Crawford & Company (right) presenting cheque for $5,000 to Tom Anderson of ABC Insurance Brokers on behalf of NS Special Olympics. The donation was made in conjunction with NS Blue Goose Pond annual “Honker Classic” held at Chester Golf & Country Club. l Crawford & Company (Canada) Inc. recently promoted three current officers.

James Eso is now Senior Vice President, Property and Casualty. Eso has 26 years of experience in multi-line adjusting, with 23 of those years at Crawford.

Greg Smith has been promoted to Senior Vice President, Key Account Management. Smith has more than 14 years of experience.

Heather Matthews is now Senior Vice President, National Claims Management Center. Matthews started as an adjuster with Crawford. She has worked in sales, where she specialized in the risk management and U.S. markets, and in the healthcare division, which she went on to lead in 2009. l

42 Claims Canada

p42-43 OTS final.indd 42

June/July 2012

Granite Claims Solutions Meaghen Calder Clement Legault

Level 3 Level 2 Level 2 Level 2

St. Catharines, ON Level 1 Sudbury, ON Level 3

Kernaghan Adjusters Limited John Sutherland Osoyoos, BC David Horner Edmonton, AB Raymond Harris Smith Toronto, ON

Level 2 Level 2 Level 1

Sedgwick CMS Canada Inc. Gregory Bidzinski Mississauga, ON

Level 1

CIAA New Members — April 2012 CORPORATE MEMBERSHIP Canadian Specialty Services Corporation — Moncton, NB Nick Stagliano & Associates — Mississauga, ON INDIVIDUAL MEMBERSHIP Canadian Specialty Services Corporation Richard Ravn, CIP Moncton, NB

Level 2

Nick Stagliano & Associates Nick Stagliano, CIP Mississauga, ON Scott Mastromatteo, CIP Mississauga, ON

Level 3 Level 3

Crawford & Company (Canada) Inc. Kate Nelson Calgary, AB Denise Duval, CIP Regina, SK Jules Giasson Winnipeg, MB Charles Beland Dartmouth, NS Juanita Fraser, CIP Dartmouth, NS Christopher Goodwin Mt. Pearl, NL Chris Kidney Mt. Pearl, NL

Level 2 Level 3 Level 1 Level 1 Level 3 Level 1 Level 2

Granite Claims Solutions David Lavergne

Winnipeg, MB

Level 2

Kernaghan Adjusters Limited Kirk Rudnick Winnipeg, MB

Level 2

www.claimscanada.ca

27/06/12 1:40 PM

APPOINTMENT

CIAA Ontario chapter recently held their annual education seminar on May 11, 2012 at the Sheraton Hotel with guest speakers Philippa Samworth of Dutton Brock and Kirk Quinn from the Insurance Bureau of Canada. The seminar was well attended and proudly sponsored by H&A Forensic Accounting Inc., McKellar Structured Settlements, Northwood & Associates and Sibley & Associates.

Congratulations to the following individuals who won the raffle prizes from our sponsors: Debra J. Hodgson of The Co-Operators, Craig Anderson, Sajed Hussain and Izin Convery of Crawford & Company. l

Gia Ghassemi Claude Blouin and Jamie Dunn, Partners at Blouin, Dunn LLP, are extremely pleased to announce that Gia Ghassemi has joined the firm as an associate lawyer.

Gia graduated with a Bachelor of Arts in Economics from the University of Western Ontario in 2001, following which, she worked in a compliance and risk role at an investment firm in Toronto. She then attended at Bond University in Australia to obtain her law degree. She obtained her Certification of Qualification from the National Committee on Accreditation in 2009 and was called to the Ontario Bar in 2010.

CIAA Toronto Executive members at the Mix & Mingle hosted by Blouin Dunn & Giffin Koerth following the 45th annual CICMA/CIAA Ontario Chapter Joint Conference. l

After her call to the Bar, Gia articled and practised as an associate at an insurance defence firm prior to joining Blouin, Dunn.

Gia’s legal practice is focused on insurance defence litigation with an emphasis on personal injury tort claims, occupier’s liability, property damage, sports liability and products liability.

Gia is a member of the Canadian Bar Association, Advocates Society, Toronto Lawyer’s Association and the MedicoLegal Society of Toronto.

Gia’s contact information is: gghassemi@blouindunn.com (416) 365-7888 ext. 147

CIAA’s Nova Scotia chapter held a seminar in Dartmouth May 11 on Post Concussion Syndrome: The Concept And Its Abuses. In the photo above (from right) are Grant King, CIAA N.S. Pres; Sarah LeBlanc, Director CIAA N.S.; Jamie Chipman, Q.C .( Presenter ); Carol Messervey, Director/ Education chair, CIAA N.S.; Dr. David King, Bsc, MD, FRCPC,( Presenter); Candice Colwell Director, CIAA N.S. l

Claims Canada Wants You!

Blouin Dunn LLP is one of Ontario’s leading insurance defence firms whose members have been providing quality legal support to the insurance community for over 30 years.

We offer services in Ontario to property and casualty insurers throughout North America, at all levels of experience, at appropriate and competitive rates.

www.blouindunn.com

Claims Canada magazine wants you to send us your company news, appointments and event photos for possible inclusion within our ‘On the Scene’ department. Please help us share your items with the claims industry across the country. For more information, please email: craig@editinsight.com

www.claimscanada.ca

p42-43 OTS final.indd 43

June/July 2012

Claims Canada 43

27/06/12 1:40 PM

• on the scene OTS A.R.S. Assessment Rehabilitation Services Inc. held an Open House on Apr. 12, 2012. A.R.S. staff greeted and hosted dozens of company partners and clients. l

ProFormance Group Inc. hosted its 2nd Annual Wine Tasting & Charity Event on Apr. 19. The evening, held at the Drake Hotel in Toronto, included a silent auction, a 50/50 draw and great raffle prizes, including a weekend getaway. More than $6,600 was raised and went to the Jennifer Ashleigh Children’s Charity - These funds will go to help approximately 10 families with children that have serious illnesses “when love is not enough”. Wine tasting and hors d’oeuvres were available throughout the evening. Jennifer Valentyne of Breakfast Television emceed the event. l

44 Claims Canada

p44-45 OTS.indd 44

June/July 2012

www.claimscanada.ca

27/06/12 1:43 PM

APPOINTMENT

A record turnout of almost 200 industry representatives attended the 53rd Annual Reception of the Quarter Century Club on May 17 at the Hilton International in Toronto. The event was a roast for claims industry veteran Gary Gardner, senior vice president with Crawford & Company (Canada) Inc. His insurance career began in 1981 as an adjuster with Crawford & Company in Toronto. Gardner became Canadian sales manager before moving on to Willis (then Willis Corroon Melling) in 1994. He subsequently moved to JLT (then Jardine Insurance Brokers Group) in 1995. Gardner moved back to Crawford July 2000 and is currently Crawford’s senior vice president of sales and marketing. l

Paul J. Barnes Claude Blouin and Jamie Dunn, Partners at Blouin, Dunn LLP, are extremely pleased to announce that Paul J. Barnes has joined the firm as an associate lawyer.

Paul received his Bachelor of Arts (Honours) degree from Acadia University in 2000 and then attended the University of Windsor, where he obtained his law degree in 2004.

Paul was called to the Nova Scotia Bar in 2005 where he began a general litigation practice and did work as a Federal Crown Attorney. He returned to Ontario in 2006 and began working exclusively in insurance defence litigation, initially on behalf of municipalities in the Greater Toronto Area. In 2007, he started to practice with the in-house litigation firm of one of Canada’s largest home and automobile insurers, where he worked until joining Blouin, Dunn LLP in April 2012.

Paul has extensive experience in the handling of motor vehicle and property-based tort claims, as well as Statutory Accident Benefits disputes. He also has significant experience acting as counsel for insurers in private arbitrations arising from Priority and Loss Transfer disputes, and right-to-sue applications before the Workplace Safety and Insurance Appeals Tribunal.

Outside of the office, Paul’s interests are largely focused on professional baseball – he is a season ticket holder to the Toronto Blue Jays and has travelled extensively in the United States, Japan, and Cuba to experience the game in as many different ballparks as possible.

Paul’s contact information is: pbarnes@blouindunn.com (416) 365-7888 ext. 139 Blouin Dunn LLP is one of Ontario’s leading insurance defence firms whose members have been providing quality legal support to the insurance community for over 30 years.

We offer services in Ontario to property and casualty insurers throughout North America, at all levels of experience, at appropriate and competitive rates.

www.blouindunn.com

www.claimscanada.ca

p44-45 OTS.indd 45

June/July 2012

Claims Canada 45

27/06/12 1:43 PM

• on the scene OTS The 12th annual Ontario Pond Blue Goose Scotch Nosing took place on May 31, 2012 at the spectacular Ritz Carlton - Toronto. Over 180 Ganders and guests attended with substantial sums raised for the Women in Insurance Cancer Crusade and Starlight Children’s Foundation. The donations were as a result of the generosity of our sponsors Blouin Dunn LLP, Giffin Koerth Smart Forensics, Hughes Amys LLP, & The Interpreters Group. This year saw the return of Ed Patrick - President and Founder of the International Order of the Companions, Ed lead with tastings from Dalmore, The Balvenie, Macallan and the very rare Aberlour Abunadh.

Thank you to organizers Laurel DiMaso, Jamie Dunn & Anna Galanter for a very special evening. l

46 Claims Canada

p46 OTS.indd 46

June/July 2012

www.claimscanada.ca

27/06/12 1:45 PM

CRDN

Absolutely worth the call.

CRDN proudly supports environmentally conscious processes that achieve significant reduction to water, energy and landfills. You and your homeowners deserve a professional Textile Specialist on your team!

Calling a CRDN Textile Restoration Specialist will: F Reduce SeveRity - Ability to restore 100% of all soft textiles found in homes today - CRDN Restoration vs. Replacement is an 80% savings - 100% Guaranteed – If it doesn’t restore – it’s free!

F Reduce A.L.e.

- 48 hour “Rush” service F iMPROve cuStOMeR SAtiSFActiON - Fast response and highly professional service with a caring attitude

CRDN Certified Restoration Drycleaning Network

1-866-897-CRDN (1-866-897-2736) www.CRDN.ca

ad size.indd 22

12/04/12 10:43 AM

ad right size.indd 1

19/06/12 10:28 AM