Claims Canada February/March 2011

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February/March 2011

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Contents FEBRUARY/MARCH 2011 • VOLUME 5 • NUMBER 1

Cover Feature

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12 Forecasting the Future Adjusters can better navigate catastrophic bodily injury claims by paying close attention to key factors, including working with a qualified life planner and understanding potentially problematic areas.

BY CRAIG HARRIS

Spotlight 20 Coasting Uphill Coast Claims is taking the West Coast by storm; looking for opportunities for growth throughout the region.

BY LAURA KUPCIS

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Education Forum 42 Coping with Catastrophes A catastrophe is a sudden and unexpected event causing many insured claims.

When and how to set up a response service is crucial.

News Features 22 The Independent Adjuster New education programs, and commitment from the CIAA, will ensure that independents are around for a long time yet.

BY TERESA MITCHELL

26 Injury vs. Syndrome Under the right conditions, a whiplash injury can turn into whiplash syndrome.

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BY LAURA KUPCIS

28 A Year of Firsts A number of legal issues were addressed before the courts for the first time in Atlantic Canada over the last year.

BY J. GREGORY CLOONEY and SHEREE L. CONLON

32 10 Coverage Decisions from 2010 That You Ought to Know About The Ontario Court of Appeal had a busy year with six major insurance coverage decisions released.

BY CHRISTOPHER R. DUNN

36 Analyzing Weaknesses in Income Loss Reports There are many factors involved in preparing an income loss report and any weaknesses can be detrimental.

BY MICHAEL SIGSWORTH and DARRELL SHERMAN

38 Minor Injury Caps While the constitutionality of the cap does not appear to be an issue, future disputes will likely surround whether an injury is minor or not.

BY CHRISTA M. BROTHERS and JOSEPH A. CHEDRAWE

Departments 4 First Notice 44 On The Scene

Columns 42 Education Forum

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• first notice FN Privacy Commissioner reaches impasse with SGI over collection of health information under province’s Insurance Act The Office of the Information and Privacy Commissioner in Saskatchewan says it has reached an impasse with Saskatchewan Government Insurance (SGI) over three ‘breach of privacy’ complaints related to the collection of personal health information under the Automobile Accident Insurance Act (AAIA).

Saskatchewan’s privacy commissioner has recommended in a report that Saskatchewan’s legislature amend legislation to clarify the rules applying to the public insurer’s collection, use and disclosure of health information collected under the AAIA. The privacy commissioner has also recommended that SGI publish on its web site “clear information about its collection, use and disclosure practices.” SGI, the commissioner said,

should also “revise its procedure for the collection of personal health information to ensure it is not over-collecting such information.”

The privacy commissioner released its report after investigating three formal, separate breach-of-privacy complaints.

Each complaint related to the collection of health information after the claimant sustained an injury in a motor vehicle accident.

Upon being approached by the privacy commissioner, SGI took the position that the privacy commissioner had no authority to investigate the complaints,

because the information was collected pursuant to the AAIA, and not therefore subject to the Health Information Protection Act or the Freedom of Information and Protection of Privacy Act. “The Commissioner considered representations from SGI and concluded that there is no evidence that the Legislative Assembly would have intended to create such a gap in legislated privacy protection and that, in fact, there is no such gap as alleged by SGI,” the commissioner concluded in its report. ●

Change in occupation test not enough to overturn arbitrator’s order to pay IRB benefits A change in the occupation test for determining Income Replacement Benefits (IRB) before and after a 104-week period of disability is not necessarily enough of a “change” of circumstances to warrant overturning an arbitrator’s order to pay IRB benefits.

Ontario’s insurance regulator, the Financial Services Commission of Ontario (FSCO), made the ruling in Wawanesa Mutual Insurance Company and Sophia Sun. Under Ontario legislation, an insurer cannot deny IRB benefits after an arbitrator has ordered that a claimant is entitled to ongoing benefits, unless the insurer receives a variance order from an arbitrator based on an “alleged change of circumstances.”

Among other things, Wawanesa noted the change of the occupational test in Ontario’s legislation between the pre- and post-104-week disability period was in itself a change of circumstances to warrant termination of benefits.

Prior to the 104-week point of a disability, a claimant must meet the “own 4

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occupation” test to be entitled for IRB benefits. In other words, the claimant’s injury must prevent him or her from performing the tasks of his or her own occupation.

IRB

104WEEKS After the 104-week point of a disability, however, the test changes to the “any occupation” test. That is, to be entitled to receive IRB benefits after the 104-week period, a claimant’s injuries must prevent them from performing the tasks of any reasonable occupation.

An Ontario arbitrator ruled Sophia Sun was entitled to IRB benefits because she could not perform the

tasks of her own occupation, which was on an assembly line.

Subsequent to that decision, Wawanesa ordered a number of further assessments, and sought for the IRB benefits to be terminated based on the findings of these new assessments.

Wawanesa argued the subsequent assessments proved that Sun’s injuries did not meet the post-104-week occupation test — that she could not meet the tasks required of “any” reasonable occupation.

The arbitrator re-iterated this was an appeal case under s. 287 of the Insurance Act, which “affords a mandatory protection of benefits” following an arbitrator’s order. To overturn this, there must be a change of circumstances.

“Neither of these decisions [supplied by Wawanesa in support of its case] supports the proposition that the change in the [occupational] test alone suffices to constitute a material change in circumstances where benefits have been finally ordered after a full hearing on the merits,” a FSCO arbitrator concluded. ● www.claimscanada.ca

Every file is different

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

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• first notice FN DNA testing at the top of MPI’s list of top five frauds in 2010 DNA testing, CSI-style, ferreted out a fraud scheme in which a Manitoba driver vehemently denied crashing his car, causing his airbag to deploy.

The attempted fraud made the top of Manitoba Public Insurance (MPI)’s top five frauds of 2010.

The vehicle owner was adamant his vehicle had been stolen, despite a statement to the contrary by an eyewitness who arrived shortly after the vehicle had crashed into a pole. The crash occurred only blocks away from the home of the owner.

“The airbag, which had blood on it, was subsequently seized by MPI and sent to a lab for testing,” MPI says in a press release announcing its top five list. “DNA testing conclusively proved that the blood belonged to the vehicle owner, who later pleaded guilty to making a false statement.”

In addition to a fine of $350, the

owner agreed to withdraw his vehicle damage claim with MPI valued at $12,900. “’Mr. DNA [the vehicle’s owner] also agreed to reimburse the public auto insurer $3,437 in investigative costs,” MPI announced.

MPI says its investigators have recovered undeserved benefits and denied fraudulent claims totaling more than $50 million over the last five years.

Other frauds on the list include a Winnipeg man with a guilty conscience who contacted MPI and admitted to burning a vehicle four years after the act.

“The man explained that he had been the former fiancé of the vehicle owner and needed to admit to his criminal actions,” MPI said.

The man agreed to repay $3,782 to MPI, in addition to receiving a fine of $864 after pleading guilty to Fraud Under $5,000. ●

Nova Scotia projects 17 per cent claims cost increase from tripling auto injury cap The Nova Scotia Utility and Review Board says the province’s decision to triple its minor auto injury cap from $2,500 to $7,500 will result in a 17 per cent increase in third party liability-bodily injury claims costs, and the industry-wide rates are adequate to absorb the costs.

The board held a hearing on the effects of the cap, the final submissions of which were heard on Oct. 28, 2010.

In its final decision following the hearing, the board’s actuary reported the increased claims cost would result in a $24 increase in required premium (the analysis presumed a return on equity of 12 per cent).

But since the average street premium (the premium charged to a policyholder) is about $800 — $106 higher than the estimated amount required to cover claims and generate a reasonable profit — the board concluded the $24 could be absorbed in the industry-wide 6

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rate without consumers being charged more premium.

The board’s numbers were in marked contrast to those submitted to the board by an actuary contracted by the Insurance Bureau of Canada.

Ron Miller of Exactor Insurance Services estimated the impact of the province’s higher cap would increase claims costs in the third party-bodily injury area by 49.3 per cent.

Miller said the $70 increase in claims costs would require a premium increase of more like $100 than $24. The surplus in street premium would mean the full $100 would not need to be charged, Miller noted.

The board did note it was premature in 2010 to determine the effects of the cap reform on loss costs and loss trends. It therefore concluded it will “hold a formal paper hearing in the fall of 2012 to examine any impact of the minor injury reforms.” ●

ICBC loses appeal in hit-and-run case The Insurance Corporation of British Columbia (ICBC) has lost its bid to appeal a case in which a gas station owner was injured after a customer filled up her car with gas and attempted to drive away without paying.

Parminder Kumar Nayar commenced an action against ICBC when he was hurt trying to stop an unidentified driver from driving away without paying for gas.

The driver drove into Nayar when he stood on the road in front of the car. She accelerated to 100 km-h while he lay on the hood of the vehicle, and then turned sharply, throwing him to the pavement.

Nayar launched the action against ICBC because his injuries were caused by an unidentified driver. A lower court found ICBC was 100 per cent responsible for the plaintiff’s injuries.

ICBC argued the lower court should have found Nayar at least partly responsible for his injuries.

ICBC claimed Nayar was negligent for having placed himself in front of the vehicle when the driver was in an agitated state, and remained there even though she revved the engine and inched forward before driving into him.

Nayar was injured in 2004. The trial occurred in September 2008. A notice of appeal was filed in October 2008, but counsel for ICBC fell ill, which meant ICBC’s case wasn’t prepared until the end of April 2010, three weeks after the appeal was dismissed.

ICBC applied to have its appeal reinstated, but B.C. Court of Appeal denied the attempt. The Court of Appeal agreed with the judge who dismissed the case on the basis that the appeal was “very weak” and “doomed to failure.” ●

HIT&RUN www.claimscanada.ca

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• first notice FN Nova Scotia has right to recover nursing home costs against insurer in an auto accident case Nova Scotia’s Department of Health does have a subrogated right to claim against an insurer for nursing home costs arising from injuries sustained in a motor vehicle accident, according to the Supreme Court of Nova Scotia.

In Slauenwhite v. Keizer, Jean Slauenwhite was 81 years old in Dec. 15, 2004, when she was a passenger in a car driven by Erna Keizer, then 78. Kaizer drove her vehicle off the road into a rock cliff, and Slauenwhite suffered a permanent loss of eyesight. Slauenwhite’s injury meant she was unable to return to her apartment at Musquodobit Harbour. After a lengthy hospital stay, Slauenwhite moved into a nursing home.

The province subsidized the costs of the nursing home.

The province claimed the nursing home subsidy from Kaizer’s insurer, citing the Health Services and Insurance Act of Nova Scotia (HSIA). The legislation was amended in 1992, allowing the province to charge an annual levy against the province’s motor vehicle insurers to collect health-related services resulting from motor vehicle accidents.

The court rejected the defendant insurer’s reference to an apparent exclusion contained in Subsection 18(10) of the HSIA. Subsection 18(10) of the act reads: ‘This section applies except where personal injury has occurred as the result of a motor vehicle accident in which the person whose

act or omission resulted in the personal injury is insured by a policy of third-party liability insurance on or after the date this subsection comes into force.’

The court noted this subsection was in direct contrast with Subsection 18(6), which states: ‘Where a person whose act or omission resulted in personal injuries to another is insured by a liability insurer, the liability insurer shall pay to the Minister any amount referable to a claim of recovery of the cost of insured hospital services, benefits under the Insured Prescription Drug Plan, ambulance services to which the Province has made payment and insured professional services that would otherwise be paid to the insured person and payment of that amount to the Minister discharges the liability of the insurer to pay that amount to the insured person or to any person claiming under or on behalf of the insured person.’

Noting the apparent discrepancy between the two subsections, the court said the exemption in Subsection 18(10) must be interpreted in the context of the entire legislative scheme.

The court goes on to note the legislation’s objective is clearly to impose liability on tortfeasors and their insurers to pay for health costs resulting from personal injuries caused by any wrongful or negligent act or omission, and does not exclude auto accidents. ●

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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: 12 Concorde Place Suite 800, Toronto, ON, M3C 4J2.

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 and

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Message from the President La Plume du Président MARY CHARMAN I am extremely pleased to announce that a CIAA National Insurance Industry Advisory Board has been created. The board consists of CIAA executive members and insurance company and broker representatives. The mandate is to maintain a pro-active national forum working on behalf of Canada’s claims professionals to address and resolve mutual and individual issues of concern. This is a very exciting initiative, representing the interests of CIAA member companies and differentiating CIAA members by communicating and working side-by-side with key industry stakeholders for the benefit of the entire membership. Our first meeting was extremely productive, addressing property and casualty core issues to develop working solutions, protocols and standards to ensure CIAA member firms are consistently on the leading edge. Education, cross training and secondments between CIAA members and insurers are just a few initiatives being explored to help resolve the overwhelming concern of attracting, training and retaining the best people to ensure a bright future with top-quality industry professionals.

The Insurance Institute’s Annual Convocation and Awards night showcasing the industry’s academic achievements was held in January. CIAA is proud to support the Institute’s award ceremonies at both the national and regional level. The association also offers its own scholarship to assist the next generation of insurance professionals and more specifically those looking to pursue a career in the claims field. Further information on CIAA’s scholarship can be found on our website at www.ciaa-adjusters.ca.

Congratulations to the CIAA and CICMA Ontario Chapters for hosting another extremely successful Joint Conference in early February. This event is always a big draw and attracts members from across Canada. The opportunity to learn and network with your colleagues and grow together as a profession is really what our associations are all about. I sincerely thank organizing committees across the country for their efforts in hosting these superb events and living up to the motto, “United 10

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J’ai le grand plaisir de vous annoncer que le Conseil consultatif national de l’industrie de l’assurance de l’ACEI a été formé. Composé de membres de l’exécutif de l’ACEI et de représentants de sociétés et de courtiers de l’assurance, ce conseil a pour mission de constituer un forum national chargé de prendre des initiatives au nom des professionnels canadiens des sinistres, en abordant et solutionnant les problèmes communs et individuels qui les préoccupent. Il s’agit d’une initiative passionnante qui représente les intérêts des sociétés membres de l’ACEI et où se distinguent les membres de l’ACEI qui communiquent et travaillent côte à côte avec des participants essentiels de l’industrie pour le bénéfice de tous les adhérents. Notre première réunion, très fructueuse, a porté sur les questions fondamentales des biens et accidents, à la recherche de solutions, protocoles et normes de travail de sorte que les sociétés membres de l’ACEI soient constamment à l’avant-garde.

L’enseignement, la formation transversale et les affectations provisoires entre les membres de l’ACEI et les assureurs ne sont que quelques-unes des initiatives examinées pour aider à résoudre la difficile question d’attirer, de former et de retenir les meilleurs personnes et leur assurer un brillant avenir parmi les grands professionnels de l’industrie.

La soirée de la cérémonie annuelle de remise des prix de l’Institut d’assurance soulignant les succès académiques de l’industrie s’est tenue en janvier. L’ACEI est fière d’appuyer cette cérémonie de remise des prix de l’Institut aux plans national et régional. L’Association offre en outre sa propre bourse pour aider la prochaine génération de professionnels de l’assurance, et plus précisément ceux qui désirent faire carrière dans le secteur des sinistres. De plus amples renseignements sur la bourse de l’ACEI sont affichés sur notre site web au www.ciaa-adjusters.ca.

Nous félicitons les sections ontariennes de l’ACEI et de l’ACDSA qui ont accueilli, début février, une autre Conférence conjointe qui a connu un franc succès. Cet événement est toujours très populaire et attire des membres de partout au Canada. Une telle occasion de se renseigner et de tisser des liens avec nos collègues et de faire www.claimscanada.ca

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& Committed Leadership through Education, Professionalism and Communication.”

The winter of 2010-2011 came in like a lion, especially in Atlantic Canada, and members were in full response mode bringing in extra staff, some from other provinces, to handle the excessive amount of claims. Severe weather events appear to be the norm and no longer the exception. CIAA New Brunswick, Nova Scotia, Newfoundland and Manitoba regions have expended a lot of time and energy in developing EMO response programs with their provincial governments. They are to be commended for their diligence and proficiency in the planning and execution of these programs on behalf of the CIAA membership. CIAA’s National Emergency Measures Committee is working on securing similar Disaster Assistance Programs in all regions.

I encourage the non-members waiting in the wings to make the investment and join us! ■

progresser ensemble la profession répond au but ultime de nos associations. Je remercie sincèrement les comités organisateurs à travers le Canada qui ont préparé ces remarquables événements en accord avec leur devise ‘Leadership uni et engagé par la formation, le professionnalisme et la communication.’

L’hiver 2010/2011 a fait une entrée fracassante, particulièrement dans les provinces de l’Atlantique, et nos membres, constamment sur le qui-vive, ont dû embaucher des surnuméraires, même dans d’autres provinces, pour faire face au nombre excessif de sinistres.

Des changements climatiques importants semblent devenir la norme plutôt que l’exception et l’ACEI des régions du Nouveau-Brunswick, de Terre-Neuve et du Manitoba a consacré beaucoup de temps et d’énergie à établir des programmes d’accès à l’OMU avec leurs gouvernements provinciaux. Ils méritent d’être félicités pour avoir, au nom des membres de l’ACEI, planifié et exécuté ces programmes avec diligence et efficacité. Le Comité national des mesures d’urgences de l’ACEI désire instaurer des programmes semblables d’Assistance désastres dans toutes les régions. J’encourage donc les non-membres de notre association, qui se tiennent dans la coulisse, d’aller de l’avant et de se joindre à nous. ■ Translation provided by Henry Arcache, Themis Translations

NATIONAL EXECUTIVE 2010 – 2011 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

SECRETARY Marie C. Gallagher, FCIP, CRM McLarens Canada 71 King Street, Suite 204 St. Catharines, ON L2R 3H7 Phone: (905) 984-8282 Fax: (905) 984-8290 E-mail: marie.gallagher@mclarens.ca

1ST VICE-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

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

2ND VICE-PRESIDENT Delores Thorbourne, BA, FCIP McLarens Canada Suite 103 Greystone VII 4208 - 97 Street Edmonton, AB T6E 5Z9 Phone: (780) 442-3077 Fax: (780) 466-0325 E-mail: delores.thorbourne@mclarens.ca

www.claimscanada.ca

PAST-PRESIDENT 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

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 David Porter, LL.B., FCIP, CRM Advance Claims Service Ltd. 206 - 2323 Boundary Road Vancouver, BC V5M 4V8 Phone: (604) 642-0660 Fax: 1-888-452-5246 E-mail: davidp@advanceclaims.com

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 DIRECTOR John Jones, BA McLarens Canada Suite 300, 5915 Airport Road Mississauga, ON L4V 1T1 Phone: (905) 671-3164 Fax: (905) 671-1889 E-mail: john.jones@mclarens.ca

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Unraveling the complexity of future care costs and life care plans can be a challenging task for adjusters in today’s legal environment of high personal injury awards. Paying close attention to key factors, such as working with a qualified life care planner and understanding potentially problematic areas, can help adjusters navigate the waters of catastrophic bodily injury claims.

BY CRAIG HARRIS

W

hile catastrophic injury claims in Canada have not necessarily increased in frequency in recent years, the numbers associated with court awards have raised several eyebrows in the insurance industry.

Over the past five years, a “cluster” of high-profile serious bodily injury claims in Ontario has upped the ante for these types of losses to $15-20 million or more.

The most recent large personal injury award, involving an Ontario woman who was severely injured in an August 2002 car accident, is only the latest in a series of settlements involving insurance companies. Ontario Superior Court Justice Peter Howden awarded Katherine-Paige MacNeil a record-setting $18.4 million on Sept.

2, 2009 after the car in which she was a back-seat passenger ran a stop sign, crossed a highway and landed in a ditch.

The Ontario Court of Appeal www.claimscanada.ca

upheld a $17-million personal injury award in April 2009 –at the time, the largest in Canadian history – to Rob Marcoccia. In June 2000, Marcoccia suffered massive brain damage when he collided with a furniture truck at an intersection.

These cases build off several substantive court awards for future care costs involving two claimants with brain injuries (Sandhu v. Wellington Place Apartments – future care cost of $10.9 million, Gordon v. Greig – future care cost of $8.6 million) and one claimant with quadriplegia (Morrison v. Greig – future care cost of $8.8 million). In the Sandhu case, in which a 2year-old boy fell through a screen window from a fifth floor apartment building and sustained a severe brain injury, the jury awarded about $1.3 million more in future care than the figure suggested by plaintiff counsel.

“The implication of these cases is that damage awards . . . involving a catastrophically injured claimant can

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? reach upwards of $20 million,” says Michael Bennett, a lawyer with Thomson Rogers and the lead author of a recent report on future care costs. “If the evidence adduced from experts established that future care is reasonably necessary to preserve the plaintiff’s health and this care is proved to cost millions of dollars, the courts have been more than willing to award millions in future care.”

Future care costs are the biggest component underpinning these large damage awards in catastrophic bodily injury cases. As costs increase, there is emerging recognition from the insurance industry that the way these claims should be handled needs to change.

“I think the plaintiff’s bar has taken a more sophisticated and comprehensive approach to catastrophic injuries,” says Gerry George, a lawyer with Samis & Company. “They have marshaled experts and gathered opinions to support future care costs. At the same time, I think defence lawyers and February/March 2011

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insurance companies have been caught a little flat-footed. They have not defended these claims as aggressively as they could.”

This call for change and a more comprehensive approach to catastrophic injury claims filters down to adjusters and claims handlers. “What the insurance industry needs is experienced people who know how to separate the wheat from the chaff in these cases, so the injured person is getting what he or she needs, no more and no less,” points out Fred Plant, president of Plant Hope Adjusters.

One of the key tools used to calculate accurate future care costs and quality of life for the catastrophically injured claimant is the life care plan. It has become more prominent in tort cases involving serious bodily injury claims within the last ten years, often used to assist plaintiff or defence lawyers in identifying total costs of future care.

“I would say that more and more lawyers are aware of the need to get a life care plan done to more accurately determine future care costs for those seriously injured,” says Jamie Campbell, director of rehabilitation services for Rehab First. “These are being done more frequently than in the past.”

A life care plan is a structured, researched plan that identifies and estimates an injured or disabled person’s current and future needs in areas of medical, rehabilitation, equipment, home support and quality of life. These plans are customized to the individual’s situation and can include: home care/facility care, projected therapeutic treatments, diagnostic testing, wheelchair needs and mobile assistance devices, orthopedic equipment, orthotics/prosthetics, aids for independent function, home furnishings and accessories, medication, future medical care, transportation, architectural home modifications, leisure or recreational equipment and programs and vocational/educational plans.

(While sometimes referred to interchangeably, future care cost reports and life care plans are similar but not necessarily the same. Life care plans focus on catastrophic and permanent 14

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A life care plan is a structured, researched plan that identifies and estimates an injured or disabled person’s current and future needs in areas of medical, rehabilitation, equipment, home support and quality of life. whole-body impairment from which the claimant will not recover over his or her lifetime, while future care cost reports may involve serious but less catastrophic injuries and treatment over a prescribed time period.)

In life care plans, several factors are contributing to higher expenses in catastrophic injury claims — including predictable increases in inflation and market value of health care services and equipment, but also a greater use of private agencies for treatment.

“The life care plan has continued to evolve whereby there is less of a reliance

on the health care system and government services and more on the private clinics who offer these services,” says Monique Besz, a certified life care planner with Kompass Lifecare. “This has led to increased costs of care for the injured individual, which in turn has led to increased awards in court.”

Another evolution in life care plans is a more expansive view of quality of life issues for the catastrophically injured claimant, as opposed to the strict focus on medical treatment and care.

“Sometimes, there is the perception from people in the insurance industry that ‘if we just get the person a wheelchair, he or she should be fine’,” says Phyllis Spencer, a vocational consultant with Crawford & Company (Canada) Inc. “That is not the case. There are many other aspects of a person’s life that you need to take into account, such as recreational, vocational, social and community interaction, family relations.”

Life care plans are usually completed by registered nurses, occupational therapists, vocational consultants and rehabilitation management firms.

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The two most contentious areas of life care plans themselves seem to be attendant care and transportation, with some pointing to modification to housing as an increasingly costly issue.

(CLCP) designation, which started in the U.S. but has expanded to include a Canadian designation (CCLCP). The Canadian program consists of eight courses that must be completed within a five-year period in order to write the Canadian certification exam. The International Commission on Health Care Certification, based in Virginia, is the agency that certifies life care planners in Canada.

“One thing adjusters and insurers should look at is whether the life care planner they choose is certified,” says Judy Farrimond, technical advisor, catastrophic and legal services for Sibley & 16

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Associates. “There are lots of people who do life care plans who don’t have the training. They may have experience, but when you are trained and certified in life care planning, there are certain nuances you can pick up. It can make the process that much more objective.”

Certification in Life Care Planning is becoming increasingly important, adds Linda Walker, a certified life care planner and rehabilitation consultant with Linda Walker & Associates. “Both insurers and lawyers are requesting Certified Life Care Planners. Training, experience and additional qualifications are highlighted, in particular experience working with catastrophically injured clients.”

Plant says he concurs with the importance of finding the right kinds of experts to conduct appropriate life care plans. “The quality of the expert comes into play and a good one will have an impact,” he says. “Selecting the good one requires someone in the know making the recommendation and moving the file in the right direction.”

George says he does not disagree with the importance of life care certification, but “it should be the icing on

the cake. I think there should be more emphasis on the actual hands-on experience in rehabilitation and the medical background of the planner. My understanding of the designation requirements is that these are pretty light on actual course work and study hours.”

The two most contentious areas of life care plans themselves seem to be attendant care and transportation, with some pointing to modification to housing as an increasingly costly issue.

These are two among a wide range of quality of life determinants that could include ongoing treatments for physiotherapy, occupational therapy (among other therapies), medication, assistive devices, wheelchairs or mobility aids, recreational and vocational needs.

For many life care planners, their recommendation to adjusters and insurers is to look at the big picture. “I think adjusters, lawyers and insurance companies have to avoid the pitfall of being penny wise and pound foolish,” says Spencer. “For example, there may be something like transportation costs in a life care plan that a company might see as unnecessary. But let’s say that transportation actually gets the client to a job. He or she starts to become a wage earner, becomes more independent and experiences the social and team aspects of work. That is a positive outcome.”

Life care planners also have to be conscious of budgetary realities, according to Spencer. “The role of the life care planner is to create the best plan for the person first, and think of the budget second,” she says. “Having said that, we live in the real world of cost constraints. There are some creative ways that life care planners can address cost issues without sacrificing the quality of the plan.”

Spencer cites a specific example of how life care planners can approach expenses from a different perspective.

In one case involving a claimant with mental health issues, a financial institution was designated as the administrator of the settlement, at a fairly high fee. However, the planner found that the office of the public guardian could provide the same administration for a lower fee. “On a huge settlement www.claimscanada.ca

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amount, such as $5 to 10 million, a few percentage points can make a big difference,” she says.

Others contend that there is a long laundry list of items adjusters and insurers can do to help create effective life care plans — enabling correspondence with all treating practitioners, giving enough lead time for report completion and allowing the plan author to meet with the client. Thorough file documentation, a theme familiar to many adjusters, is also a crucial element of a successful life care plan, according to sources.

“The role of the life care planner is to educate and provide a report that identifies the client’s current and future needs,” Besz observes. “In order to achieve this result, insurers should provide the life care planner with all medical documentation as it is available to them.”

It is better to have all the information in the file, particularly if there is a conflict between the plaintiff and defence lawyers, Farrimond says. “The last thing you want is to surprised by a kick in the teeth on a certain file.”

An adversarial legal system and lengthy disputes of cost projections between plaintiff and defence lawyers can frustrate many in the field of life care planning and rehabilitation, with the claimant often caught in the middle.

“The ongoing fighting between plaintiff lawyers and defence lawyers or adjusters can get very annoying,” Campbell says. “The goal should be to ensure that clients get what they are entitled to, no more and no less. The role of the life care planner is to come up with that right number.”

Spencer offers up blanket advice for all involved: try and be reasonable when it comes to costs. “That may be more difficult if someone is working on a contingency fee basis, but there is a lot to be said for common sense when it comes to settlement and life care plans. I have seen files that are inches thick and the process has gone back and forth for five years. That is not necessary (because) it is usually the injured person that is stuck in limbo in this process.” www.claimscanada.ca

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This push-pull dynamic can lead to questions about the qualifications and potential bias of report providers.

Sometimes the answer appears to depend on who is commissioning the future care report — the plaintiff or defence lawyer.

Walker notes that Form 53, which was introduced in January 2010 and requires acknowledgement of an expert’s duty under rules of civil procedure in Ontario, must now accompany

all life care plans. “Basically the author of the life care plan or future care report is stating that the report is fair, objective, non-partisan and our opinion related to only matters within area of expertise,” she says. “In addition we are to provide additional assistance as the court may reasonably require.”

If litigation does take place, George argues that insurers have to be better prepared to properly defend these types of claims. “The sophistication of the

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plaintiff’s bar is not going away on these claims,” he notes. “They are spending more money on pursuing these claims in the form of disbursements. That is why it has gotten as far as it has. We need to increase our sophistication and resources in defending these claims.”

George points out that there have been some favourable developments for the insurance industry in catastrophic injury claims and life care plans. The first is the regulatory change in recent Ontario auto insurance reforms that no longer require insurance companies to pay for life care plans or future care plans. While this decision applies only to accident benefits claims under SABS, George argues that it will still provide some relief for insurers.

Others are not sure this provision will actually help claimants or insurers.

“I have to ask, why is this a good thing?” asks Campbell. “If someone buys enhanced benefits in med/rehab and attendant care and they suffer a serious injury, they could have up to $3 million in accident benefits funding. Shouldn’t there be someone working with the client, adjuster and lawyer to figure out a plan and determine costs? I think enlightened insurers and adjusters will still pay for life care plans because they see the value.”

Another emerging trend in litigation for catastrophic injury claims is the move to a more level playing field for defence and plaintiff- requested life care plans, according to George. Several cases were heard in 2010, including Vanderidder v. Aviva Canada and Kozhani v. Gelbart, in which a judge held that insurance companies could require the plaintiff to participate in a life care assessment by a certified life care planner.

In Aviva v. Vanderidder, the plaintiff, Vanessa Vanderidder, was injured when rock fragments from a truck flew through her open car window and struck her in the head. She alleged serious injuries that caused permanent and serious disfigurement, as well as serious impairments of important physical, mental and psychological functions. A future care costs report was prepared for the plaintiff’s counsel,

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which placed the present value on Vanderidder’s future health care needs at just over $719,000.

Aviva requested that the plaintiff participate in a life care plan assessment by an occupational therapist and certified life care planner. In granting Aviva’s motion, Justice Granger noted that “it would seem to me that if Vanessa Vanderidder elects to place before the court evidence concerning her future care needs as determined by a non-health practitioner, she can hardly be heard to claim that it would be unfair to order her to submit to such an assessment by a person of the choosing of the defence.”

George notes that, “This is important because it puts the defencerequested life care plan on a similar footing as that of the plaintiff. Previ-

“If a report is completed and insurance companies are relying upon it to settle, it is in their interest that (the report) is not only objective and complete, but also defendable.” ously, the insurer had to prove that the requested assessment or plan was necessary to aid a health care practitioner as a diagnostic tool.”

For Plant, this confirms a long-held suspicion that life care plans recommended by insurers for defence purposes are frequently seen by courts as mere tactical maneuvers. “I think that often defence-commissioned reports tend to be looked upon as somehow tainted, less than valid and only there to beat down the oppressed plaintiff — no matter how bogus the plaintiff’s case may be,” he says.

Another litigation strategy for insurance companies to consider is the role of juries in catastrophic injury cases, George notes. “We used to look at judges as the enemy of the defence in

personal injury cases, but I think now the reverse is true,” he says. “Many of the high awards in Ontario were given by juries at trial. In contrast, in B.C. the personal injury awards given by judges have been more moderate. We may have to look at issues like whether these cases are too complex for juries. This will not be an easy process to change, but it is worth contemplating.”

Catastrophic injuries represent a delicate balancing act for insurers and adjusters. The goal is to ensure that claimants receive the appropriate treatment, care and compensation to which they are entitled. But insurers and adjusters also have to recognize the trend of rising personal injury damage awards and an increasing sophistication on the part of plaintiff lawyers when it comes to future care costs.

They can react appropriately to the claim by requesting a comprehensive life care plan by a qualified professional, either outright or in defence. But it has to be the right plan conducted by the right planner.

“To do a proper life care plan requires a certain amount of time and expense,” Campbell says. “If someone spends a couple of hours with a client and then writes a report, it is probably not adequate. You get what you pay for. Insurers have to work closely with life care planners. It is in not only their client’s best interest, but in their interest as well.”

A life care plan is supposed to represent an objective evaluation of the client’s needs, Besz notes. “If a report is completed and insurance companies are relying upon it to settle, it is in their interest that (the report) is not only objective and complete, but also defendable.”

For Plant, a crucial part of the appropriate handling of these serious injury cases comes down to the experience of the claims professional involved. “The biggest issue we have now is the (need for) people in the adjusting and insurer offices who can properly deal with these things, find the right medical experts and quarterback settlements, in litigation or not, to where they need to be,” he concludes.

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• spotlight S

Coasting Uphill Coast Claims is taking the West Coast by storm.

BY LAURA KUPCIS

C

oast Claims wasn’t about to let losing 50 per cent of their business slow them down. In 1974, just four years after launching a new adjusting firm whose main source of business was adjusting automobile claims, the Insurance Corporation of British Columbia became the exclusive automobile insurer for the province, effectively decimating this line of business for independent adjusters.

But 27 years later, the company has grown from one office to eight and from two employees to 50. Clearly, Coast Claims didn’t let the setback hold them back for long.

Three partners launched the company in 1970: Jim Bennolio, Jack Bell and Don Wakham. In 1972, Jim Eisler joined the firm, followed by Dave Hart in 1973. In 1974, after the loss of the auto claims, the original three partners went their separate ways and Coast Claims was left in the capable hands of Eisler and Hart. The two partners rebuilt the business by finding new opportunities to create a successful and thriving company, before retiring.

Eisler retired in 1997 and, although still working, Hart sold his interest in the business five years ago. Today, there are two controlling shareholders: Darwyn Stickle and Allan Hart. Many of the company’s adjusters are also shareholders in the business.

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“We have had three management transitions in 40 years, a milestone we just reached,” A. Hart says proudly.

Over the years more than just the faces have changed. For Coast Claims, the biggest change has been the nature of communication within the organization and the industry as a whole.

“Everything is immediate,” A. Hart says. “Insurers and insureds expect and get a much higher level of service because of the way communication is sent. Emails and electronic reporting has improved the way we convey information to insurers.” Previously, communication between independent adjusters and insurers was, for the most part, based on formal reporting.

While that still exists to some degree, there is now constant email communication between all parties that didn’t exist previously.

Technological improvements Another major change for Coast Claims was switching to an electronic file management system, which was implemented two years ago. This allows insurers to access their files online and check the status of the claim 24-7. They can access reports, attachments and enclosures, including photographs. Additionally, it allows the company to track the number of claims that Coast Claims is handling

on their behalf currently, and throughout the previous year. The company can also provide the client with loss tending if they so desire. Furthermore, as a tool for management it allows the firm to monitor adjuster performance, workload and file status, keeping everyone accountable. “Our clients love it and are using it more all the time,” A. Hart says.

“It was a bit of a challenge getting some of our “senior” adjusters to use the program” A. Hart adds. “Now we’ve got everyone working on it religiously.”

Digital technology has also allowed the firm to provide a much more thorough product. This includes more statements and photographs which are stored and sent to our clients in electronic format for future use, as needed.

“The Internet is a fantastic tool which helps us in our investigations, research, sourcing and pricing. “It’s just easier to obtain information these days,” A. Hart says.

A great place to work But while there might have been many changes in technology, the company has very little in the way of staff turnover. “Good people are hard to find and once we have them we work hard to make sure they never want to leave,” A. Hart says. www.claimscanada.ca

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There have been a number of additions to the roster over the years — there are now roughly 50 employees including 27 adjusters and investigators in eight offices and one satellite office.

“We embrace a team concept, but encourage our adjusters to think independently and outside the box,” A. Hart says. “We also try to create a fun and creative work environment so that our people actually look forward to going to work.”

For Hart, the company is at a good size right now. “We are large enough to compete with the national firms in our area, but not so large as to be inflexible or to have excessive overhead.

“We’re at a size where we appreciate every piece of business that we get and we ensure that each new assignment is handled properly by a competent and qualified adjuster,” A. Hart adds. “We’re also flexible enough that if there is an emergency in a certain area, we can pull adjusters from other offices and have them there in a matter of hours to assist.

“We can also accommodate any requirements that an insurer has and convey direction to our adjusters instantaneously. Furthermore, if there is a problem or concern it is dealt with by the owners of the business, and we follow up to ensure that it was addressed to everyone’s satisfaction.”

Looking forward And while the company might be at a good size right now, that doesn’t mean they are not focused on growing further. Coast Claims is currently the largest independent adjusting firm on Vancouver Island, and while they are going strong on the Island and in Vancouver proper, they are looking at opportunities for growth in British Columbia and other parts of Western Canada. “We intend to carefully expand organically and by mergers and acquisitions,” A. Hart says.

“We’re not looking at being a national player at this point. We already are www.claimscanada.ca

strong in several niche areas and are looking for opportunities to expand in the West.

“There are still lots of opportunities out there for adjusting firms that are able to provide exceptional service, A. Hart adds.

“We’ve sometimes been disappointed when major insurers who have been long-time supporters decide to move all their business to a national adjusting firm. But those issues sort themselves out over the long-term.”

Coast Claims is the largest independent adjusting firm on Vancouver Island, and while they are going strong on the Island and in Vancouver proper, they are looking at opportunities for growth in British Columbia and other parts of Western Canada.

It’s also tough to find good adjusters to bring on board — a plight plaguing all adjusting companies.

“We’ve attracted great people with experience in other fields and other industries,” A. Hart says. “We’ve promoted several people from within and we’ve recruited top talent from larger insurers. Finding good qualified adjusters is a challenge not only for us, but I’m sure for most firms”.

While there isn’t an official mentoring program in place at Coast Claims, if somebody expresses interest and has what it takes to be a great adjuster, there exists the possibility to move up the ranks to independent adjuster. “We’ve promoted several

people from within in the last couple of years and it’s worked out really well,” A. Hart says.

Making good choices Clearly, the choices Coast Claims has been making and the directions they have been taking have been for the best — they’ve increased their office space eight-fold, their staff 16 times over and they’ve added special investigators to the mix. “We’ve expanded and specialize in various niche markets, including marine accident investigation and damage surveying,” A. Hart says. “Our adjusters, especially our senior ones, have a tremendous array of skill sets and they are always willing to share their experience and provide advice to our younger adjusters. In addition to general property and liability loss adjusters, we have adjusters that specialize in large losses; property and complex liability, marine, municipal insurance and heavy equipment. We also have several investigators who conduct special investigations. We make sure that each assignment gets to the right person.”

The firm is also a long-time member of the association. Both Eisler and D. Hart were Canadian Independent Adjusters’ Association (CIAA) national presidents. A. Hart is currently the treasurer for the Pacific Region and served as conference organizer for the most recent convention which was held in Victoria, B.C. “It is the only organization of independent adjusters in Canada and it provides a united voice to deal with government issues, licensing issues and the insurance industry as a whole” A. Hart says.

“It has allowed us to meet and discuss issues with other adjusters and firms, in non-competing areas. We’ve made a lot of friends across Canada and the United States.”

And just like in business, you get out of it what you put into it.

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The Independent Adjuster: The End of the Road?

BY TERESA MITCHELL

It’s 2:13 a.m. on a Tuesday, you’re in bed, sound asleep, when the phone rings.

You wake with a start, heart pounding, wondering who is calling at this time of night. When you answer the phone, it’s the after-hours emergency service calling you with a claim.

You ask them to hold, while you try to wake up enough to find the pen and paper you know is somewhere in the room. You take down the information: A family of four is standing out on the road watching their home burn to the

ground. You call the claimants, explain who you are, listen to the woeful events from a sobbing insured — “everything is gone.” You get some vital information and directions to the home. You say you’ll be there as soon as possible and to hang tight, all the while trying not to wake up your spouse or the kids. You get dressed in the shadows of the bedroom, thinking, “I hope these socks match.” You rush downstairs, grab your briefcase and cell phone, throw on a coat and boots, and out the door you run. As you’re racing down the highway, going through your mind what is needed;

XYZ Insurance Company has a specific protocol: consent to enter; privacy consent; statement from the insured; building and contents scope (if there’s anything left); interview the fire chief and police; photos; if the Fire Marshal is there and releases the property, arrange for the preferred contractor to attend and secure the property (Who’s on the rotation list for the preferred’s this week?); arrange for site security if warranted (What’s the name of that company the insurer uses?). You arrive at the scene, witness a smoldering heap of what once was a two-storey century home, and parents with two kids

A large loss

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under 10 standing on the road, wearing nothing but the pajamas they wore to bed, watching anxiously as you drive up the road towards them. Your adrenaline is rushing; this family needs help. And you’ve arrived to do just that — help them.

Education programs I suspect many of you have gone through something like this a time or two in your career. In my 20-plus year career as a road adjuster, this has happened often, and always with the same result: the great feeling that you are helping others in their time of need.

Over the years, people have asked why I became an adjuster. I come from an era where almost everyone became an adjuster by accident: It wasn’t planned, it just happened. But today, Ontario has several colleges that have insurance programs, where students can take business studies with an emphasis on insurance and obtain courses towards their CIP. So we are now seeing young people choosing to work in insurance,

and planning their education to achieve that goal. Canadian Independent Adjusters’ Association (CIAA) Ontario region developed a program in 2009 to introduce these students to the world of the independent adjuster, a program which is now an annual event. During the 2009 CIAA/Canadian Insurance Claims Managers Association (CICMA) Joint Conference, we sponsored six students from the three local colleges to attend the conference.

Then-president John Seyler and pastpresident Mary Charman spent the day with the students, participating in the conference, and introducing them to claims managers and other independent adjusters. The students were amazed at what we do and the service we provide to the industry and the public as a whole. Four of the six students were so enthralled they presented their resumes to CIAA, eager to start their career as an independent adjuster. It is wonderful to see young people wanting — and planning — to work in our industry.

A dying breed?

Unfortunately I have heard rumblings throughout the independent adjuster community about us being a “dying breed.” This concerns me terribly! I have spent my entire career as an independent: It’s what I know and love and plan to do until I retire. My research attempts to locate the root of these rumblings were not successful.

Every industry goes through cycles of “feast and famine,” and every time our industry slows down, the rumblings start about independent adjusters dying out. We are in another cycle right now, where “famine” has set in with many firms. Claims volume is down, insurers repatriating claims, smaller independent adjusting firms are either closing or being bought by large firms and large firms are laying off staff. But, we are a resilient group, and as with previous cycles, things will change for the better. How do we stop these rumblings? The answer is twofold.

First, education is paramount. The industry leader for insurance educa-

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CIAA is working towards revamping their designations, and developing a program to promote the designations and our members, to bring the independent adjuster into the forefront of the insurance industry. tion is the Insurance Institute of Canada (www.insuranceinstitute.ca). Others include Mohawk College (www.mohawkcollege.ca), Seneca College (www.senecac.on.ca), Fanshawe College (www.fanshawec.ca), or information on the CIAA website (www.ciaa-adjuster.ca). Education is important to every employer, and most offer in-house courses or programs.

Second, we need to promote the abilities and skills of our members.

CIAA is working towards revamping their designations, and developing a program to promote the designations and our members, to bring the independent adjuster into the forefront of the insurance industry. The key to our success is showing the insurance industry and consumer, that doing business with us is a benefit to them.

We provide a vital service, and the independent adjuster is here to stay.

Teresa Mitchell is a senior general adjuster with Crawford Global Technical Services at Crawford & Company (Canada) Inc. Mitchell is also the CIAA Ontario region’s first vice president.

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Syndrome Versus Injury Both whiplash syndrome and whiplash injury cause pain to the injured party, but only one presents with a physical cause

BY LAURA KUPCIS

D

istinguishing between someone suffering from whiplash syndrome and someone suffering from whiplash injury can be tricky for for both the medical and insurance community. Both clients are experiencing real pain, one simply has no physical cause for the hurt.

“They are feeling true pain, there is just no physical cause,” said Dr. R.J. Kamatovic, family and emergency medicine doctor, of those suffering from whiplash syndrome. “It’s thought largely to be due to psychological issues.

They are not faking it, they are not just trying to cash in; in most cases they are actually experiencing true pain.”

Whiplash injury, on the other hand, is a musculo-ligamentous sprain, Kamatovic said during a recent seminar in Toronto hosted by Giffin Koerth. And, as with any minor sprain, there is the expectation that it will heal and the injured person will recover.

A 1995 study conducted by neurologist Dr. Henry Berry looked at injury suffered by demolition derby drivers.

“He couldn’t find one single case of whiplash,” Kamatovic said. The study looked at 20 drivers, aged 19 through 48 who had been in the sport an average of 6.8 years. The average driver is hit 48 times per derby and will drive in roughly six derbies per year, accounting for about 1,900 hits for one driver.

A quarter of these hits were considered severe. Most of the drivers had a sore neck or sore shoulders and were back driving in the derby within three days.

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one month, before getting right back in the driver’s seat. There were no reports of dizziness, headaches, numbness, poor memory, poor sleep or anxiety.

Somatiform disorder However, there are those injured in a motor vehicle accident who continue to believe that they have — and continue to be treated for — whiplash injury, when in fact they whiplash syndrome — a somatiform disorder. The patient continues to receive treatment for a sprain, when in fact they should be treated for the underlying psychiatric or psychological disorder which is causing them to feel pain, Kamatovic said.

“The important thing about recognizing somatiform disorder and appreciating it is . . . they are experiencing true pain,” he said. In fact, it is a pain severe enough to disrupt their every day life; it just does not have a physical cause. There is, however, often a psychological reason for the pain — one that can be triggered and exacerbated by a visit to the emergency room and follow-up trips to a family doctor. Certain common characteristics tend to be present among those prone to somatiform disorders: female, questionable coping skills, pre-existing psychological or psychiatric issues, depression, anxiety, history of abuse, low levels of job satisfaction and general unhappiness with life. Oftentimes they have a catastrophizing personality — where everything is the worst-case scenario.

When looking at the classic patient who is at risk of developing whiplash syndrome or chronic pain syndrome,

there is a strong desire to assume the “sick role,” Kamatovic added. This often stems from an unhappy childhood where the only time the person felt good was when they were sick — they stayed home from school and didn’t have to deal with bullies, their overly critical parents might have been a little lax — and in fact provided some nurturing — when they were ill. “So, on a subconscious level, with a fragile psyche, there’s a strong drive to stay in that sick role,” Kamatovic said. “And most of this is subconscious; they don’t realize they are doing it. They find it better off being sick than trying to deal with the world around them.”

But how do we go from having an injury, which more often than not heals within a few days, to having a somatiform disorder?

Step 1: The emergency room Wait times in ERs can be upwards of six hours — at times higher — for nonemergency cases. It’s overcrowded, there are people on floors, on stretchers, in hallways. “It’s mass chaos . . .

You’ve got to be nuts to go to an emergency room,” Kamatovic laughs. “But, that is red flag number one: They have come to the emergency room.”

Those who come in hours, or even a few days, after an accident, and are willing to wait around for hours in the ER can signal one of two things: The person either has poor coping skills or they are looking for documentation to confirm a first encounter for insurance purposes.

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around for quite some time, waiting to see a doctor. While there are very few whiplash patients who need an x-ray of their neck — based on the Canadian CSpine Rule — most will still receive one.

A big part of this is customer satisfaction, Kamatovic said. This person has been waiting for upwards of six hours, if not more, and are not going to be very pleased when a doctor finally comes over to speak to them and says, “You’re fine, you can go,” without running any tests, he said. So, some of it is about avoiding complaints. But, other times it’s a fear of missing something.

Every ER doctor has heard the horror story of a patient who walked in with an unstable C-Spine fracture, and now every doctor is afraid this patient is coming back, so they order x-rays.

“We’re afraid that we might missing something; either a real injury or an imaginary injury or a coincidental injury later on,” Kamatovic said.

A doctor will diagnose whiplash, because it is a symbolic diagnosis and the patient leaves because they have been told they have a sprain, which seems reasonable. This can be followed up by a prescription for anti-inflammatories, which is a reasonable course of action for a sprain, though not required and will not speed healing. This makes the doctor seem active in the treatment process, and the patient is happy.

“We use the term whiplash because it’s a symbol, and human beings are more symbolic thinkers than anything else,” Kamatovic said. “They recognize the term whiplash, they know it’s not fatal, they feel safer leaving.” However, this can cause problems down the road.

“By giving them that prescription, you’ve just told them that they have an actual disease,” he added. “Treatment equals disease. You wouldn’t have given them anything if there wasn’t anything wrong.”

Step 2: The family doctor After a trip to the emergency room, the patient follows up with their family doctor — a patient advocate. “It’s very hard, because you have a therapeutic alliance and so when the patient comes in, there is almost this sense that you should be on the patient’s side and you’re in this together,” Kamatovic said. www.claimscanada.ca

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The patient who is best off is the one who never goes to see a doctor, Kamatovic said, noting that this is with respect to a low-grade sprain. He cited a low-back strain study (the equivalent of whiplash injury in motor vehicle accidents) where 186 patients were split into three groups: Two days of best rest, an hour of back school where they were educated on their lower back and exercises to do at home, and a third group who were told to continue their life as normal. The third group fared the best, seeing better recovery, less pain and greater functional status. Those in the back school fared the worst, because they were forced to focus on the pain.

“There’s no better way of making sure they won’t recover from their pain, than having them think about it every day,” Kamatovic said. A little bit of benign neglect is probably the best thing offered to a patient, he added.

The problem with whiplash syn-

There is, unfortunately, a strong enticement on both sides of the fence to keep whiplash syndrome alive, and more often than not patients are caught in the middle drome is that the sprain isn’t the actual problem, and trouble starts with continuing to try and treat the sprain and not the actual psychological concerns.

There are symptoms, including anxiety, depression, headaches, fatigue, neck pain, etc., which are accepted as legitimate. The issue is that, more often than not, these are symptoms of a somatiform disorder, and not actual injury; a disorder which is extremely difficult to treat in a family doctor’s office. The problem is that pain is subjective — it is very difficult to prove or disprove. “We are afraid to let it end with the idea that they are somaticizing, because they might not be,” Kamatovic said. “And the stakes are so high, it’s a risk we can’t take.”

This means that tests are ordered — MRIs, bone scans, x-rays, blood tests — and, frankly, if enough tests are

ordered, something will show up, he said. An MRI is, in fact, the worst test to order, because most people have bulging discs — a finding which has very little to do with actual symptoms.

But it’s enough for a person to cling to, which means the illness is reinforced when treatment is prescribed for the bulging disc.

“The problem is continuing to treat at the tissue level for an illness that is psychological or psychiatric,” Kamatovic said. “You can’t make something go away when it’s never really there.”

The solution The ideal solution for Kamatovic would be to get family doctors out of the equation: The minute a whiplash injury walks through the door, the doctor is at a conflict of interest. “In the absence of being able to prove or disprove, all we can do is rubberstamp their symptoms,” he said.

Anybody who suffers from a whiplash injury could be sent to a third party whiplash treatment and assessment centre, where the doctors are “bulletproof” and able to make “schoolyard diagnoses.” (This is a reference to when kids are playing in the yard, one gets hurt and another tells them to suck it up and get on with it, and they do — not realistic, however, in a professional setting, Kamatovic notes).

The third solution is to rebalance the scale: If there are no secondary benefits to having whiplash injury, the actual number of cases would decrease. Kamatovic cited how self-employed people take next to no sick days, because the benefits of being sick do not outweigh the benefits of going to work.

There is, unfortunately, a strong enticement on both sides of the fence to keep whiplash syndrome alive, and more often than not patients are caught in the middle, Kamatovic said.

“The solution would be to stop paying patients for having whiplash, stop paying us for treating it, and then you’d rebalance the scale,” he said. “The benefits of not having whiplash would start to outweigh the benefits of having whiplash and you would see whiplash syndrome cease to exist.”

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A Year of Firsts

BY J. GREGORY CLOONEY AND SHEREE L. CONLON

2009-2010 marked a series of “firsts” in Atlantic Canada, particularly in Nova Scotia, as several legal issues were addressed before the court for the first time.

The first Canada pension plan deduction case McKeough v. Miller1 The first time a Nova Scotia Court deducted Canada Pension Plan (CPP) benefits from an award for loss of past and future income was in McKeough.

The case involved a multivehicle collision which occurred during whiteout conditions. The trial was straightforward with regard to liability. There were claims of contributory negligence and damage issues.

Defence counsel argued that CPP benefits should be deducted from any past and future loss of income award.

A reduction in damages paid for loss of income is allowed if the plaintiff receives benefits under an income-continuation plan, provided the plan has no right of subrogation as per amendments to the Insurance Act.2 Prior to the amendments the case law precluded the deductibility of CPP benefits from loss of income claims. Justice N.M. (Nick) Scaravelli held that s. 113A is very similar to provisions in the Ontario Insurance Act3, aside from the “no subrogation” requirement in the Nova Scotia legislation. Scaravelli held, as the Ontario courts have long held, that 28

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CPP benefits are deductible from an award for past and future income loss.4 McKeough is a useful precedent in rationalizing Nova Scotia law with the quantification of damages in other jurisdictions and is of immediate importance in cases of loss of income.

The deductibility of income replacement or continuation benefits will have to be evaluated in relation to the law applicable to collateral benefits and s. 113A of the Insurance Act. Scaravelli’s decision on costs is also of interest.5 At trial, Scaravelli determined the $75,000 available Section B no-fault benefits would be split between medical expenses ($25,000) and future weekly indemnity benefits ($50,000). The amount outstanding on the loss of future income claim, after deducting CPP benefits, fell well short of $50,000. Although the $50,000 had been earmarked for the loss of income claim in the trial decision, Scaravelli held that the remaining Section B money could be deducted from the total damages award.6 Therefore, monies payable under Section B can be applied against all heads of damages in order to prevent double recovery.

The first case overturning the certification of a class action Ring v. Canada (Attorney General) 2010 NLCA 20 The Newfoundland and Labrador Court of Appeal handed down a significant class action decision on Mar. 22, 2010 in Ring v. Canada. This is an Agent Orange case, arising from the spraying of herbicides at CFB Gagetown in New Brunswick from 1956 to date. The allegation was that the spraying of herbicides at the army base during that period of time materially contributed to or caused lymphoma for the plaintiff, and other members of the class. The trial judge held that the criteria for certification of a class action had been met. Three appeals were taken by various parties affected by the certification decision. The Court of Appeal overturned the decision, holding that the criteria for certification of a class action had not been met. In the course of reaching its decision, the Court looked at the standard of review, holding that whether certification of the class action complies with the standards specified in the class actions legislation (in this case, the Class Actions Act) is a question of mixed fact and law, noting that for www.claimscanada.ca

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“certain criteria, a question of law is extricable.”

The Court held that under the Newfoundland legislation, the onus is on the applicant to establish the criteria for certification, with an onus of meeting all criteria (in this case five) prescribed by the legislation. The Appeal Court agreed with the trial division judge that the evidentiary threshold for certification application was “some basis in fact.”

In the course of discussing the cause of action, the Court noted that the plaintiffs proposed to identify the existence of “toxic areas” within which herbicides had been sprayed, and they proposed that members of the class who had not yet been diagnosed with lymphoma would not have to prove they had absorbed toxic chemicals, but simply that they had been in a “toxic area” of the base. As the Court put it in paragraph 57, “the plaintiffs seek to proceed directly from breach of a duty of care to compensation without the necessity of proving either economic or physical injury. (emphasis added)” However, returning to fundamental principles, the Court of Appeal said in paragraph 58 that damage or injury to a plaintiff is an “essential element in a claim in negligence,” and said that element was absent from the pleadings with respect to the asymptomatic subgroup, and further held that the risk of a future disease is not actionable in the absence of a present injury, citing Grieves v. FT Everard & Sons Ltd. The Court of Appeal then examined whether an identifiable class could be determined and held that it was not possible to do so, finding in paragraph 72 that defining a class as “all individuals who were at CFB Gagetown between 1956 and the present” lacks the required rational connection to the causes of action and common issues identified by the plaintiffs. Those two items alone — existence of a cause of action and lack of identifiable class — were sufficient to dispose of the appeal. The Court then examined the proposed common issues, noting in paragraph 85 that the appellants submitted that there were “at least 12 chemicals sprayed and 40 www.claimscanada.ca

than in Bryson, the Court had similar concerns to those outlined in Bryson with respect to the proposed common issue, namely, the association between the spraying and the risk of or causation of lymphoid cancers in humans.

The Court concluded that none of the proposed common issues in the Ring case was truly a common issue for each member of the class.

distinct lymphomas, hundreds of causal relationships would have to be determined, leaving aside the complicating factor of spraying having taken place over a period in excess of 50 years.” The Court adopted the discussion of general versus specific causation in another Agent Orange case, Bryson v.

Canada. While the issue was more narrowly framed in Ring

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Rather, as the Court put it, “there is a series of issues common to the subclasses” (para. 107). The Court concluded that in light of the timeframe involved, the large number of people, the size of the Base, and the different chemicals used, the proposed common issues would be insignificant when compared to the large number of individual inquiries necessary to resolve the claim. Accordingly, there would be no judicial economy in certifying a class action.

In conclusion, the Appeal Court said the trial division judge erred in certifying a class action as the proposed class definition did not meet the requirements of law, no common issues were identified, and there were serious issues as respects both the existence of cause of action and the common issues.

with the plaintiffs. While Justice Suzanne M. Hood did not take a new or novel approach to Pierringer agreements, this did represent the first time a Court in Nova Scotia has outlined the approach to be taken: I conclude that, in evaluating a Pierringer settlement agreement, the Court should consider the following: (1) there are strong public policy reasons in favour of settlement (Amoco para.

41); (2) potential prejudice to the non-settling defendants is not a sufficient reason to refute the implementation of a settlement agreement; (3) the settlement agreement must not directly limit the non-settling defendants’ procedural rights (Amoco, para. 41); (4) the terms of the agreement must be disclosed to the non-settling defen-

interrogatories. The settling parties argued that imposing such a duty would have the effect of treating them as non-settling parties, negating some of the benefits of having settled early.

Hood agreed and found that the settling parties should not be required to participate as if they had remained parties to the action.9 Another area of contention was the status of expert reports prepared for the settling defendants. The settling defendants argued that any expert reports prepared were, until disclosed, privileged. They submitted the Court should not order waiver of that privilege. Hood agreed. She held that until and unless the expert opinion is disclosed, it remains privileged. Any discovery of the experts would only be on factual matters and not on their opinions.10

Sable represented the first time a Court in Nova Scotia had considered the applicability of a Pierringer agreement.

Under the Pierringer agreement, the settling parties paid a specific amount of money to the plaintiffs and, in return, the plaintiffs discontinued their action against the settling parties.

The first “Pierringer” case Sable Offshore Energy Inc. v.

Ameron International Corporation7 Sable represented the first time a Court in Nova Scotia had considered the applicability of a Pierringer Agreement. Under the Pierringer Agreement, the settling parties paid a specific amount of money to the plaintiffs and, in return, the plaintiffs discontinued their action against the settling parties. The plaintiffs were still free to continue to pursue the action against the non-settling parties. The settling parties were relieved from any obligation to contribute to damages payable by the non-settling parties in the event of any court-ordered payment.

In Sable, fifteen defendants and third parties (the settling parties) entered into settlement agreements 30

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dants and the court (Amoco, para.

41); (5) the court must balance the potential prejudice to the non-settling defendants against the cost and inconvenience to the settling defendants preventing the loss of evidence which may be relevant at trial to determine the degree of fault of any person; (6) the order must not be inconsistent with the terms of the settlement agreement; if it is, it is in effect a refusal to approve the settlement; (7) the non-settling defendants are not entitled to procedural rights they would not have if there were no settlement; (8) the stage of litigation.8 One of the more contentious issues was whether the settling parties had to make their workers available for discovery in order to provide answers to

Sable, as the first judicial consideration of a Pierringer agreement in Nova Scotia, will be influential in the evaluation of subsequent Nova Scotia cases involving a Pierringer agreement.

Sheree L. Conlon is a partner and J. Gregory Clooney is an associate at Stewart McKelvey in Halifax, N.S. 1. McKeough v. Miller, 2009 NSSC 394 2. Insurance Act, s. 113A ( R.S.N.S. 1989 c. 231, as amended by 2003 (2nd Sess.), c. 1, s. 12) 3. Insurance Act, R.S.O. 990, c. I-8, s. 267.8(1) 4. McKeough at para. 62 5. McKeough v. Miller, 2010 NSSC 172 6. Ibid at para. 12 7. Sable Offshore Energy Inc. v. Ameron International Corporation, 2010 NSSC 19 8. Ibid, para. 28 9. Ibid para. 78 10. Ibid para. 100

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Coverage Decisions from 2010 That You Ought To Know About

BY CHRISTOPHER R. DUNN

It was a relatively busy year in Canadian courts for insurers.

While all was relatively quiet on the Supreme Court of Canada front, with the exception of release of the muchanticipated decision in Progressive Homes v. Lombard, the Ontario Court of Appeal had a particularly busy year, with no less than six major insurance coverage decisions released. Without further adieu, here are my top 10 . . . in no particular order.

Progressive Homes v.

Lombard Insurance Co. of Canada (Supreme Court of Canada, September, 2010) Progressive, a developer, was accused of faulty construction when defects in one part of a condominium project built for it by subcontractors caused damage to other parts of the building. Progressive was insured under a CGL policy issued by Lombard. Lombard denied coverage, arguing that the policy excluded coverage for the insured’s faulty work. Lombard succeeded all the way to the B.C. Court of Appeal, but ultimately failed in the Supreme Court of Canada. The court held that CGL policies cover “property damage” caused by an “accident.” The plain and ordinary meaning of property damage included damage to any tangible property, including the work of the insured. The term 32

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accident means, simply, any event which is neither expected nor intended.

The pleadings against Progressive alleged property damage, including leaking water and deterioration of building components. The pleadings also alleged an accident, as there was no reference to any intentional conduct

by Progressive. The damage also resulted from “continuous or repeated exposure to conditions,” which squarely fit within the policy. Finally, the various policies’ exclusion clauses did not apply as there was coverage for damage to work completed by a subcontractor or resulting from work performed by a subcontractor, and possibly even for damage resulting from the particular part of Progressive’s work that was defective.

This decision substantially broadens the scope of coverage available to contractors under CGL policies for their own work.

Lewis v. Economical Insurance Group (Ontario Court of Appeal, July, 2010) — Unidentified Automobile Coverage The plaintiff was injured when she struck her head on a steel pole protruding from a parked truck. Since the truck could not be identified, the plaintiff sued her own insurer under the OPCF 44R Family Protection Endorsement on the basis that she was

“hit” or “struck” by the unidentified automobile.

The Court of Appeal found in favour of coverage, holding that the words “struck by” or “hit by” must be interpreted in context of the dominant purpose of the OPCF 44R coverage, which is to compensate those injured in accidents involving unidentified automobiles.

The words struck by or hit by generally connote simply “coming into contact with” the vehicle.

Poplawski v. McGrimmon (Ontario Court of Appeal, October, 2010) — Homeowner’s Liability Coverage The insureds constructed a new home and lived in it for several years.

Their homeowner’s insurance included third party liability coverage. The insureds sold the home, and the purchasers subsequently discovered numerous defects and deficiencies with the property and sued the insureds for misrepresentation/material concealment of those defects. The insureds sought a defence from their homeowner’s insurer. The insurer conceded that an “occurrence” took place during the “policy period”, but argued that the exclusion for “claims made against you arising from damage to property you own . . .” applied.

Both the motion judge and the Ontario Court of Appeal found in favour of the insured. Based on its language, the exclusion applied only to property owned by the insured at the date of loss, as it was written in the present tense only. As the insureds no www.claimscanada.ca

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longer owned the home when the damage was suffered by the purchasers, the exclusion did not apply.

Insurers need to be very aware of this decision and may wish to make appropriate changes to their own policy language to negate its effect, as, in my view, the Court of Appeal found coverage for a risk that most insurers would never have intended to cover.

Meadows v. Meloche Monnex (Ontario Court of Appeal, June, 2010) — Homeowner’s Liability Coverage David Skidmore sued Brent Meadows following a physical altercation.

While the claim alleged assault, Meadows argued in his statement of defence that he acted in self-defence and sought coverage from his homeowner’s insurer. The Court of Appeal refused coverage, holding that, on any reasonable reading of claim, the claim was strictly one for the intentional torts of assault and battery. As there was no possibility of indemnity, there was no duty to defend. The court reasoned that if Skidmore succeeded in the action, he would have shown it to be an assault, which was excluded. If the claim failed, there was nothing to indemnify Meadows for, and therefore no insured claim. The court specifically disagreed with Glassford v. TD Insurance and Hawkes v. TD Insurance, prior Ontario trial decisions in which judges had found in favour of coverage for similar allegations. This decision is good news for insurers.

While both Glassford and Hawkes had caused insurers concern, the Ontario Court of Appeal has now refused the possibility of coverage for physical assaults, regardless of the defence plead.

Rougoor v. Co-Operators (Ontario Court of Appeal, January, 2010) — Accident Benefits The insured was covered under a standard Ontario OAP 1 for his off34

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road dirt bike. He was injured in Florida while riding an uninsured dirt bike of the same make and model as the insured bike and claimed accident benefits. The insurer denied the claim, taking the position that the dirt bike was not an “automobile” as defined in the policy. While the application judge agreed with The Co-Operator’s arguments, the Court of Appeal disagreed. Since the insured’s own virtually identical dirt bike was considered an automobile in Ontario, the policy must be interpreted consistently to hold that the American dirt bike qualified as an automobile, and coverage was available for any other automobile driven by the insured in Canada or the U.S.

Buchanan v. Wawanesa Mutual Insurance Co. (British Columbia Court of Appeal, June, 2010) — Homeowner’s Property Insurance The insureds noticed large cracks in their retaining wall, concrete planter and driveway resulting from a leaking city water valve under the property.

The insureds sought coverage for the damage under their homeowners’ policy. The insurer denied, relying on the policy’s exclusion for damage resulting from “settling, cracking and moving.” The Court of Appeal found in favour of the insured, as it felt that a prospective insured reading the policy would reasonably have assumed that there was coverage for any damage resulting from the escape of water from a public water main.

Whether on the basis of policy language itself, or the notion that the proximate cause of the loss, “escape of water . . . from a public water main” was covered, the court’s decision is sound, as the intent of the policy would seem to have been to exclude cracking and settling caused by natural forces only.

Concord Pacific Group Inc. v. Temple Insurance Co. (British Columbia Court of Appeal, June, 2010) — Builder’s Risk Temple issued builder’s risk coverage to Concord Pacific for a condominium development. The coverage included construction delays. The expiry date of the coverage was listed as Apr. 15, 2002, but, due to clerical error, the policy failed to specify a scheduled date of completion. The project was delayed in construction, and the insured claimed under the policy. The insurer argued that there was no delay as the scheduled date of completion was Apr. 15, 2002, and sought rectification of the policy. The insured argued the completion date was Nov. 15, 2001. The court initially held in favour of the insured, though the judge accepted the evidence of the insured’s broker that it agreed that the date of completion was supposed to be Apr. 15, 2002. The Court of Appeal overturned the decision, finding that the trial judge erred in considering the intention of the insured as he had already concluded that the broker intended coverage to end on Apr. 15, 2002, and the contract was made between the broker and the insurer.

This decision emphasizes that the broker is the insured’s representative in obtaining coverage, and that the broker’s representations/intentions are those that matter. If the broker errs in placing the coverage, the issue is between the insured and its broker — not between the insured and the insurer.

Engle Estate v. Aviva Insurance Co. of Canada (Alberta Court of Appeal, January, 2010) — All Risks Property The insured had all risk coverage which excluded loss or damage caused directly or indirectly by settling, expansion, contraction, moving, shifting or cracking.

When cracks develwww.claimscanada.ca

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oped in the floors, walls and ceilings of the insured building caused by construction next door, the insured sought coverage. The insurer denied.

The court held in favour of the insured, holding that the exclusion applied only to settlement-type damages caused by natural forces.

Minox Equities v. Sovereign General Insurance (Manitoba Court of Appeal, June, 2010) — All Risks Property Minox owned a condominium complex insured by Sovereign. For more than 20 years, units experienced humidity problems and mould. Minox filed two proofs of loss in 2002 relating to damage by mould, and the costs of repairing it. Sovereign denied on the basis of the policy’s exclusions for seepage, rain or dampness. The Court of Appeal upheld the denial as the policy excluded any losses resulting “directly or indirectly” from seepage, rain or dampness. The insurer was not required to prove that such events would always cause loss or damage — only that those events caused or contributed to the loss.

age on the grounds that the pool was the insured’s “work” or “product” and therefore excluded. Wawanesa argued that the mere fact that the insured’s deck needed to be replaced did not mean that it had suffered “property damage” caused by an “occurrence.”

Wawanesa’s arguments were rejected.

The deck, which was not constructed

by Beaverdam, qualified as third party property damage, and the duty to defend was engaged.

This decision is well reasoned. One must also question whether the damage to the pool itself is covered on the basis of Progressive Homes.

Christopher Dunn is a partner with Dutton Brock, LLP and his practice involves representing and providing insurance coverage advice to those in the insurance industry.

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Analyzing Weaknesses in Income Loss Reports

BY MICHAEL SIGSWORTH AND DARRELL SHERMAN

Insurers and plaintiff lawyers call upon forensic accountants to provide expert reports, which set out the income loss suffered by individuals as a result of injuries sustained in an accident. There are many factors involved in preparing these reports and as a result many opportunities for the accountant to misstep. For the careful reader, these missteps can reveal a report containing more holes than Swiss cheese.

Income loss reports (ILR) will continue to be a significant component of the claims settlement process, especially in light of the expected shift resulting from the recent SABS changes. This article identifies the weaknesses that are commonly found in ILRs, which will enable you to assess your own expert’s report or to critique an opposing expert’s findings.

First reading A forensic accountant’s report should be easily understood and absorbed on the first reading. If the report needs to be read several times before it is understood, then expect opposing counsel and the trier of fact to have similar difficulties.

This is strike one against the report. The report should be clear and logical, using layman’s terminology. A straightforward approach often examines the most critical aspects of the loss, excluding minor variables that will not significantly impact the conclusions. However, while a report may appear strong in substance, small errors (even grammatical) may hint at an underlying problem with the quality of professional effort, the rigour of the analysis and the report’s actual credibility.

Therefore, a report should be thoroughly examined for mathematical errors, where even a small error could lead to a significant difference in the quantum of the calculated loss.

Hazards and pitfalls of assumptions The most basic factor in valuing an income loss is the determination of how much the individual or business would 36

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have earned during the damage period, but for the injurious event. Due to the uncertainty that exists in projecting into the future, assumptions are used to determine the level of earnings that could have been achieved. However, it is these assumptions that are often the weakness of ILRs. The credibility of a report can quickly be destroyed because of weak or incorrect assumptions. Therefore, it is important that the assumptions are identified, that they are reasonable and they are supported by evidence. When such evidence is missing or weak, the assumptions the accountant used get called into question and this leads to the credibility of the entire report being brought into question.

In assessing the strength of assumptions, both economic and medical documentation should be considered. Projected earnings, whether pre- or post-trial, should take into account the plaintiff’s pre-incident earnings as well as their education, career progression, future goals, industry standards, economic environment, historical earning patterns and other qualitative factors. If the assumptions change over time, an explanation as to why the assumptions change, backed by evidence, should be provided to support the changes.

Another area of assumption typically overlooked, and often with significant uncertainty in an ILR, is the period during which a loss will be incurred. It is important that the end date for the damage period is reasonable, especially in cases where plaintiffs are permanently disabled and there is little or no possibility that they will be earning any future income. In some cases, the traditional retirement age of 65 will be considered reasonable. However, in some industries or for some individuals this assumption would be anything but reasonable.

For example, if an individual who was almost 65, was in good physical health prior to the accident, and had intended to work for another 10 years, using a retirement age of 65 would be unreasonable. Additionally, statistically men and women do not retire at the same age. It is important to note that the farther the end date is from the trial date, the smallwww.claimscanada.ca

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er the impact is on the overall numbers, due to discounting to a present value.

Of course, the ILR must not only include a calculation of the projected earnings, it must also include a determination of the earnings the plaintiff can expect to attain in the future, given their compromised state. The assumptions on which this latter calculation is based are no less important, since the difference between the projected and expected earnings are what form the basis of the loss. Serious thought must be given to whether a person is really permanently unemployable.

From a plaintiff counsel’s perspective, it is becoming ever more important that the assumptions employed by their expert result in realistic conclusions as well. ILRs which overstate the loss due to unsupportable assumptions may result in settlements at amounts significantly lower than indicated in the ILR and perhaps lower than merited, exposing plaintiff counsel to negligent settlement claims by their clients.

ever, upon closer examination it may be revealed that a component of the loss results from the loss of a significant customer immediately prior to the incident, seasonal variations in sales, changes in accounting policies, changing economic conditions or perhaps the injured person was on the verge of being laid off or downsized. These variables, and many others, can significantly impact the assumptions, findings or conclusions and should be kept in mind.

Uncertainty in findings As previously stated, ILRs are projections into the future.

As a result, some degree of uncertainty will always exist.

Therefore, it is legitimate, and often helpful, to present one or more alternative scenarios of the loss of income.

Presenting a single scenario leaves all parties with very little room to negotiate and the trier of fact with no flexibility. Either that finding presented is accepted or not. Normally, providing a range of scenarios permits all parties to assess potential losses while incorporating their view on the underlying issues, including medical findings. However, similar to the assumptions supporting projected earnings, each of the alternative scenarios should be prepared based on supportable assumptions.

What isn’t considered counts too An often overlooked weakness in ILRs is not what has been included in the report, but rather what is missing.

As an example, income losses for an employed individual should consider the lost fringe benefits and the loss of pension value, and not just the lost Final considerations wages. Where this has not been considIt is common that ILRs are preered, it is likely that the calculated loss pared close to mediation or trial dates is understated.

The ILR must not only to ensure that the accountants have Contingencies are also sometimes the most up-to-date information on include a calculation of overlooked, and may have either a negwhich to prepare and base their conative or positive effect on the calculatthe projected earnings, clusions. Where reports have been ed loss. Contingencies may include, it must also include a prepared well in advance, it is imporbut are not limited to: tant that any new information be pro• Mortality rate determination of the to the accountant to re-assess • Labour force changes (ie. unemployearnings the plaintiff can vided the position, or to re-crunch the numment rates in an industry) expect to earn in the bers. Without this consideration, it • Possibility of earnings increases/ may not only be the accountant that decreases beyond inflation future, given their loses face.

• Disability period compromised state.

The hired gun is something that • Economic or business conditions, both sides now have to be aware of, bankruptcy of the employer’s comespecially in light of the Rules of Civil Procedure. At a minipany, etc. mum, opposing counsel and the trier of fact may discount • Impact of disability on future earnings These contingencies are often difficult to determine, and the credibility of the ILRs, when the expert is perceived as in many cases positive and negative contingencies may be an advocate rather than an objective expert.

While there may not be any single correct way to esticonsidered to cancel each other out.

Trending is also a common tool in determining future mate the income lost by an injured individual, we have losses of a business. By looking at what was happening prior observed that there are a large number of incorrect ways to to the accident, projections into the future can be created. perform such calculations. Be on the lookout for the weakBut trending can be affected by many variables, and if these nesses in ILRs described above. are not explored, the impact can be significant. For examMicheal Sigsworth and Darrell Sherman are founding prinple, a report may attribute a decline in the post-incident sales entirely to the injuries suffered by the plaintiff. How- cipals at ADS Forensics. www.claimscanada.ca

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Minor Injury Caps Early cases offer some guidance as to when a claim will fall within the cap in Nova Scotia, Alberta, New Brunswick and Prince Edward Island.

BY CHRISTA M. BROTHERS AND JOSEPH A. CHEDRAWE

Lgislative limits on general damages for minor injuries arising out of motor vehicle accidents, colloquially known as caps, have been subject to judicial scrutiny and legislative reform across Canada. The appellate courts in Alberta and Nova Scotia have upheld the constitutionality of minor injury regulations. While challenges have not been heard in New Brunswick or Prince Edward Island, given the recent court pronouncements, it does not seem the constitutionality of caps is seriously in issue. With a few early cases offering some guidance as to when a claim will fall within the cap, what lies ahead are disputes over whether a plaintiff’s injury is minor or not.

Two forms of legislative cap schemes Generally speaking, there are two very different forms of legislative cap schemes in Canada, one broad and one narrow.

The broad cap scheme has existed in New Brunswick since Jul. 1, 2003, Prince Edward Island since Apr. 1, 2004 and in Nova Scotia for accidents occurring between November 1, 2003 and Apr. 27, 2010 (the old cap in Nova Scotia). All three define a minor injury (or minor personal injury) as one that does not result in: (i) a permanent serious disfigurement; and (ii) a permanent serious impairment of an important bodily function caused by a continuing injury which is physical in nature.

The Nova Scotia definition uniquely requires that the injury resolve within 12 months following the accident. All three define “serious impairment” as an impairment that causes substantial interference with a person’s ability to perform their usual daily activities or their regular employment.

All three limit the recovery of general damages to $2,500.

While there are some differences between the three provinces’ schemes, the broad spectrum of injuries to which the cap may apply is what unites them. These schemes do not apply exclusively to soft tissue injuries, although in Nova Scotia, some categories of injury are expressly excluded, such as burns causing serious disfigurement. The New Brunswick legislation alone uses both the terms “minor personal injury” and “soft tissue injury.” The Court of Appeal in LeBlanc v.

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Bulmer ruled that these two phrases are not mutually exclusive.

The narrow cap scheme has been in place in Alberta since Oct. 1, 2004 and in Nova Scotia since Jul. 1, 2010 for accidents occurring on or after Apr. 28, 2010 (the new cap in Nova Scotia). Both provinces incorporate a narrow definition of minor injury requiring that the injury be a sprain, strain or whiplash associated disorder. It would appear that injuries other than the soft tissue variety are excluded. The definitions of “serious impairment” are essentially identical and state that it must be an “impairment of a physical or cognitive function” that meets three requirements. The cap in Alberta was $4,000 as of 2004 with yearly adjustments for inflation. The cap in Nova Scotia was $7,500 as of 2010 also with an inflation adjustment mechanism.

Evidentiary burden Whether the burden is on the plaintiff or the defendant depends on the legislation. Under the old cap in Nova Scotia, there is a presumption that the injury is minor thus placing the burden on the plaintiff to prove it is not minor. The schemes in New Brunswick and PEI do not specify an evidentiary burden, although the New Brunswick Court of Appeal in Fraser v. Haines held that the defendant has to prove that a plaintiff’s injury is minor.

In Alberta, sprains, strains or WAD injuries are considered to be minor injuries unless the plaintiff establishes that they would have resulted in a serious impairment. In this way, there is no presumption that an injury is minor, but rather a presumption that the listed injuries are minor injuries. Under the new cap in Nova Scotia, the presumption that an injury is minor has been removed and it is yet to be seen whether the burden will be placed on the plaintiff or the defendant. The Nova Scotia scheme does allow parties to make a pre-trial motion to determine whether the plaintiff has suffered a minor injury.

Constitutional challenges to the cap Both forms of legislative cap scheme have come under judicial scrutiny for their constitutionality.

In Morrow v. Zhang, the Alberta Court of Queen’s Bench struck down the Alberta cap on the basis that it infringed the plaintiff’s equality rights under section 15 of the Charter, but found no infringement of the section 7 life, liberty and security guarantee. The Alberta Court of Appeal overturned the www.claimscanada.ca

BASEMENT FLOODING Symposium May 26, 2011 Toronto Board of Trade Presented by the Institute for Catastrophic Loss Reduction (ICLR) Basement flooding is one of the biggest challenges facing homeowners, municipal governments and personal property insurers across the country.

All industry stakeholders are invited to join the Institute for Catastrophic Loss Reduction (ICLR) at a comprehensive full-day event, as we discuss the issue of basement flooding in depth.

Symposium discussions will focus on basement flooding causes, mitigative best practices, homeowner perceptions research, as well as the legal side of the issue - including discussions surrounding government liability and the role of laws and bylaws.

Contact: Tracy Waddington 416 364 8677 or twaddington@iclr.org for both attendee registration and event sponsorship opportunities.

For more info see www.iclr.org

Presenters at this one-day symposium will include: * City water/wastewater experts and managers * Researchers * Insurance experts Cost: $295 per person (includes HST)

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In Beaulieu v. Gyuraszi, a 2008 case that proceeded to the Nova Scotia Supreme Court, but applied the PEI scheme since the accident took place in PEI, multiple medical experts testified for both sides. The defendant had obtained an Independent Medical Evaluation (IME) from a specialist in orthopaedics and called him as a witness. There was also surveillance evidence. The Court relied heavily on medical opinion in assessing all heads of damage and found that the plaintiffs’ injuries fell within the cap.

In the 2009 case of Farrell v. Casavant, the plaintiff suffered a broken right wrist, a chipped bone in his left hand, a contusion to his right ankle, and soft tissue injuries to his lower back. The Nova Scotia Supreme Court applied the cap finding that the plaintiff’s injuries did not cause substantial interference with his usual daily activities or employment as Early cap cases an assistant manager at Wal-Mart. Quoting from the Ontario With the constitutional challenges Court of Appeal’s 1993 decision in settled, the new battleground will be Meyer v. Bright, the Court emphasized whether a plaintiff’s injury falls within that whether an injury will be classified the definition of minor injury. There as minor will depend on the effect of have been less than a handful of cases the injury on the particular plaintiff. that have decided whether an injury Therefore, even if the injury is one that should be classified as minor and thus most people would consider serious, subject to the cap, two from Nova Scosuch as a broken back, if no permanent tia and two from New Brunswick (and serious disfigurement or permanent all dealing with the broad cap). There serious impairment of an important are no such reported cases from PEI or bodily function results, and if the Alberta. injury resolves within twelve months, In Rossignol v. Rubidge, a 2007 New the injury will qualify as minor. ConBrunswick case, the plaintiff suffered versely, if the injury is one that most With the constitutional fractures of his right tibia and fibula people would consider minor, such as challenges settled, the and offered expert evidence from a a broken finger, it will not be considclinical psychologist that he suffered new battleground will be ered minor if that finger belongs to a post-traumatic stress disorder (PTSD). whether a plaintiff’s injury harpist who is no longer able to work The Court accepted the defendant’s as a harpist. In other words, if a seemfalls within the definition expert’s evidence who disputed the ingly minor injury (like a broken finof minor injury.

PTSD diagnosis. It could not conclude ger) results in a “substantial interferthe plaintiff had suffered a permanent ence” with the person’s ability to serious impairment of any bodily function much less an perform their usual daily activities or regular employment, important bodily function. In the result, the Court held that the injury will not be classified as minor. the injury was minor and fell within the cap. The Court noted that the Ontario cap legislation, although in some respects What lies ahead: IME’s and judicial guidance The Alberta regulations describe a comprehensive different, was useful in interpreting that of New Brunswick scheme for medical assessments by a certified examiner. In and cited heavily from the Ontario cases.

In Fraser v. Haines, a 2007 New Brunswick case, the plain- the other provinces, the defence must make a decision on tiff, a construction worker, suffered a soft tissue injury to his whether to obtain an IME. In some of the cases to date, shoulder and alleged he could no longer drive stakes into the IMEs have been used to counter a plaintiff’s subjective ground with two hands. The Court was persuaded that the claims of injury. This, along with the use of other methods accident did not result in a serious injury that substantially such as surveillance, social media and employers’ records, impaired the plaintiff’s activities or employment. He was still may be critical in assessing whether an impairment is seriable to perform his job very well albeit in a different manner. ous. That is, whether the injury causes substantial interferThe plaintiff’s general damages were capped at $2,500. The ence with one’s usual daily activities or regular employCourt of Appeal upheld the decision noting generally that an ment. It is clear that more judicial guidance is necessary to injury may be serious, but that does not mean there has been allow counsel for both plaintiffs and defendants to better a serious impairment. The Court further noted that before a predict and advise as to whether an injury is minor or outfinding of “serious impairment” could be made, there must side the applicable cap. be a substantial interference with a person’s usual daily activities or ability to perform their employment. Whether a Christa M. Brothers is a partner and Joseph A. Chedrawe is plaintiff’s injury results in a “serious impairment” is a finding of fact to be made by the trial judge based on a subjective an associate at Stewart McKelvey in Halifax, NS. They are both members of Canadian Defence Lawyers. assessment on a case-by-case basis.

trial judge’s decision on section 15 and upheld the constitutionality of the Alberta cap. In December 2009, the Supreme Court of Canada denied leave to appeal.

The old cap in Nova Scotia was challenged in Hartling v.

Nova Scotia (Attorney General). The Nova Scotia Supreme Court concluded that the legislation did not violate the section 15 equality guarantee in the Charter. The Nova Scotia Court of Appeal upheld that decision. Leave to appeal to the Supreme Court of Canada was denied in May 2010.

It is uncertain whether there will also be constitutional challenges to the cap schemes in New Brunswick and PEI, although there are test cases in New Brunswick. A recentlyannounced New Brunswick task force is expected to issue a report reviewing the cap in May 2011.

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A SERIES OF ARTICLES PROVIDED BY THE INSURANCE INSTITUTE OF CANADA

Coping with Catastrophes: Preparing a response

A

catastrophe is an opportunity for adjusters and insurers to outdo themselves and provide outstanding claims service. In this issue, we look at when and how catastrophe response services are set up.

Defining catastrophe A catastrophe is a sudden disaster of immense proportions that causes havoc to people, property and the natural environment. Many catastrophe situations arise from extreme weather conditions such as hurricanes, tornados, heavy rain, sleet and hail. Serious accidents may also cause catastrophes, for example, if hazardous materials are spilled in a residential area.

However, not all large-scale events resulting in significant damage qualify as catastrophes for the insurance industry. An insurance claims catastrophe is a sudden and unexpected event causing many insured claims, often on a large scale. The event often creates an urgent situation of need for policyholders that is a challenge to service due to the scarcity of resources in the aftermath.

For the industry to classify an event as an insurance catastrophe, the event must first be the result of an insured peril and therefore recoverable under insurance policies. Some natural disasters are not insured, so that although many homeowners and businesses may sustain damage, insurers would not be contractually required to respond. For example, most losses caused by flooding are not covered under standard policies.

Secondly, once an event qualifies for insurance coverage, it must still be 42

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severe enough to have significant financial consequences for the insurance industry. This usually involves large numbers of policies being affected, although some catastrophes involve relatively few policies but each with very large losses.

Impact of scarcity When a disaster strikes, it often creates a scarcity of resources. Large numbers of people may be without a home, without transportation, and without power. Materials and labour for repairs can be difficult to come by. Rental vehicles may not be available, and temporary accommodation for victims of the event and for relief workers may be difficult to arrange. Even cashing cheques to cover expenses can be difficult if banking systems are down.

Such scarcity causes prices to increase. In addition, when repairs and cleanup are delayed because resources are not available, property continues to deteriorate, allowing further damage to ensue. Both of these factors add to the severity of the effects of a catastrophe for the insurance industry.

Assigning loss adjusters An insurer’s catastrophe coordinator will be involved in finding qualified local staff to join the catastrophe team and enlisting the services of independent adjusters where needed. Insurers may hire independent loss adjusters if the initial claims volume exceeds what the insurer’s own staff can handle, or if specialist claims expertise is needed, for example, to deal with claims arising from an oil spill.

Enlisted loss adjusters are asked to commit to a schedule based on the demands of the emergency. For example, the insurance company may ask for a two-week commitment. This schedule should be outlined when loss adjusters are being canvassed to participate and should also be reinforced at an orientation meeting. Independent adjusters may need extra instruction on the insurer’s procedures and practices at the outset, unless they have worked closely with the insurer before.

Travel and accommodation Frequently, loss adjusters must travel to another town, city, province or even country to deal with a catastrophe claim. Adjusters may need travel documents, such as passports, and perhaps special identification to show policyholders and local officials their status.

When adjusters work across political borders, a range of requirements may need to be met. For example, adjusters sent to handle hurricane claims in Bermuda have been required to provide proof of certain vaccinations; and all loss adjusters working in Quebec — even staff adjusters — must be licensed.

The qualifications that adjusters must meet vary depending on the laws of the jurisdiction.

Transportation must be organized for loss adjusters and shipping for equipment and documentation. If the situation warrants, loss adjusters may be asked to use their own vehicles to get to the site so that they can avoid shortages of rental vehicles in the site zone.

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adjusters may resort to bicycles or other alternatives. Special delivery arrangements can be made by insurers to transport documentation to head office or other materials to the disaster site.

Adjusters and support staff working in areas far from home ideally need accommodation close to the scene of the catastrophe, but this is not always available. Sometimes adjusters need to travel great distances to reach loss areas.

Renting campers or recreational vehicles may be a viable short-term housing option. Whatever the solution, care should be taken to separate loss adjusters from policyholders when arranging accommodation.

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command centre also needs systems support for its computers.

• For emergency on-location communications or in specific circumstances, two-way radios are sometimes used if a source of power to recharge batteries is available.

In the next issue of Claims Canada, Education Forum looks at catastrophe

claims issues of security, claims-handling practices and response evaluation.

This article is based on excerpts from the study material in the Claims Professional Series of applied courses – a core of the CIP Program that helps adjusters learn the functional knowledge and skills required of their profession.

Equipment needs In addition to accommodation for adjusters, equipment required on a catastrophe site could range from clothing to generators to mobile offices: • Some insurers issue identifying clothing – uniforms, jackets or caps – to adjusters working on location. Some locations require protective clothing such as boots, helmets or masks.

• Current maps should be available to loss adjusters. Even though a disaster often obliterates street signs or landmarks, maps can still provide a basic reference point.

• If the local infrastructure supports it, adjusters may need cell phones, and special phone numbers may be assigned or a special call centre established to deal with calls related to the disaster.

• Alternate sources of power, such as gas-operated generators, can provide power for mobile living stations, cell phones, laptop computers, and other electronic equipment when conventional sources of power are out of commission.

• Mobile offices are often set up at the disaster site to serve as a command centre for the on-location team. The centre is staffed with support people and is typically equipped with phones, possibly fax machines or scanners, computers, e-mail capability, and workspace furniture. The www.claimscanada.ca

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• on the scene OTS MEA Forensic has appointed Xaine Bhatia as its business development specialist in Ontario.

Bhatia has more than 13 years of experience in business development, project management and communications. She has a Masters degree from the University of Toronto.

“This unique combination of education and experience equips Xaine with the insight needed to understand Xaine Bhatia and fulfill the specialized needs of the legal and insurance communities,” an MEA release says.

“Xaine will ensure you receive the highest level of service from our team.” ● New Brunswick’s provincial government has appointed prominent Tory lawyer Michel C. Leger of Shediac, N.B. to chair a working group established to review the existing cap and definition covering soft tissue automobile injuries in New Brunswick.

Other members named to the working group are: • Frances McConnachie, New Brunswick Consumers for Insurance Fairness; • Bill Adams, Atlantic vice-president of the Insurance Bureau of Canada; • Macgregor Grant, Insurance Brokers Association of New Brunswick; • Nathalie Chiasson, trial lawyer; • Stephane Viola, lawyer and member of the Canadian Bar Association; • Dr. Richard Dumais, a pain specialist from Moncton; and • Kathy Warren, a physiotherapist from Fredericton.

New Brunswick’s consumer advocate for insurance, Ronald Godin, will also be asked to participate with the working group in his role as advocate.

Public hearings will be held and individuals and organizations will be able to submit written or electronic submissions to the working group. ● CSN Collision & Glass has expanded its network by two more shops — one in Ontario and one in Alberta.

Ravenhorst Motors Ltd.-CSN is located in Brockville, Ont. and has operated for 55 years through three generations.

Rick van Ravenhorst said his decision to join the CSN network came out of a desire to be connected beyond the local region by “being part of a network of like-minded shops.”

Baseline Collision Repairs-CSN is located in Sherwood Park, Alta.

Bruce Gordon of Baseline said that shop joined the CSN network to “gain further knowledge and share ideas within the collision community across Canada.” ●

Claims Canada Wants You! 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: laura@claimscanada.ca 44

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Algom Insurance Adjusters, who has been located in Elliot Lake since 1957, celebrated a few milestones on Dec. 10, 2010. Roger Lauzon has been working in the insurance industry for 40 years, 20 of those with Blair Boilard at Algom Insurance Adjusters. Lauzon, who also celebrated a signifiRoger Lauzon and cant birthday on Dec. 10, will Blair Boilard continue to work part-time until his official retirement in the summer of 2012.

More than 125 family, friends and business associates helped celebrate these milestones at the Mount Dufour Ski Chalet in Elliot Lake. ● Atlantic Car Choice Collision, a member of the CSN Collision & Glass Network, partnered with Herron GM and the United Way of Pictou County in Nova Scotia to provide a family in need with a car that would otherwise be written off.

Often vehicles that need only minor mechanical and bodywork to get them road ready are written off, the joint release says.

Atlantic Car Choice and Herron worked with the United Way to identify Tracy Coady, a single mother of two small children, as the recipient of the refurbished 2008 Pontiac G6. ● McLarens Canada has acquired Mercer Myers & Associates Insurance Adjusters Ltd. Mercer Myers will continue to operate under the same brand name, as a division of McLarens Canada. It’s a full-service adjusting firm, with expertise in bodily injury investigation and negotiation, accident benefit claims management, residential and commercial property, as well as general liability claims handling.

The Mercer Myers team consists of principals Paul Mercer and Craig Myers, both of whom will continue to co-manage the office, along with 17 adjusters and support staff. ●

CIAA New Members — December 2010 CORPORATE MEMBERSHIP CKS Holdings Inc. Peninsula Adjusting Services Ltd.

Charlottetown, PE Creston North, NL

INDIVIDUAL MEMBERSHIP Canadian Claims Services Inc. Scott Thielen, CIP Calgary, AB CKS Holdings Inc. Wade Driscoll Charlottetown, PE Crawford & Company (Canada) Inc. Kimberley Daynes Victoria, BC Tom Johnman Medicine Hat, AB QA Adjusting Company Elaine McCracken, CIP, CRM Winnipeg, MB Robert Clement Winnipeg, MB Peninsula Adjusting Services Ltd. William Hynes Creston North, NL

Level 3 Level 3 Level 1 Level 1 Level 3 Level 3 Level 3

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National Standing Committees 2010 – 2011 ADVISORY 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 McLarens Canada Suite 103 Greystone VII 4208 - 97 Street Edmonton, AB T6E 5Z9 Phone: (780) 442-3077 Fax: (780) 466-0325 E-mail: delores.thorbourne@mclarens.ca 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 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 John Jones, BA McLarens Canada Suite 300, 5915 Airport Road Mississauga, ON L4V 1T1 Phone: (905) 671-3164 Fax: (905) 671-1889 E-mail: john.jones@mclarens.ca David Porter, LL.B., FCIP, CRM Advance Claims Service Ltd. 206 - 2323 Boundary Road Vancouver, BC V5M 4V8 Phone: (604) 642-0660 Fax: 1-888-452-5246 E-mail: davidp@advanceclaims.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 Craig J. Walker, CIP, FCIAA, FIFAA Maltman Group International 3550 Victoria Park Avenue, Suite 301 Toronto, ON M2H 2N5 Phone: (416) 492-4411 Fax: (416) 492-5657 E-mail: cwalker@maltmans.com 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 CONSTITUTION & RULES John Jones, BA McLarens Canada Suite 300, 5915 Airport Road Mississauga, ON L4V 1T1 Phone: (905) 671-3164 Fax: (905) 671-1889 E-mail: john.jones@mclarens.ca CONVENTION Marie Gallagher, FCIP, CRM McLarens Canada 71 King Street Suite 204 St. Catharines, ON L2R 3H7 Phone (905) 984-8282 Fax (905) 984-8290 E-mail: marie.gallagher@mclarens.ca DESIGNATION 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

www.claimscanada.ca

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 AAL Alberta Ltd. 600 – 2424 4th Street S.W. Calgary, AB T2S 2T4 Phone: (403) 452-2195 Fax: (403) 452-3568 E-mail: rvp@aaladjusters.com Craig J. Walker, CIP, FCIAA, FIFAA Maltman Group International 3550 Victoria Park Avenue, Suite 301 Toronto, ON M2H 2N5 Phone: (416) 492-4411 Fax: (416) 492-5657 E-mail: cwalker@maltmans.com John L. Taylor, BBA, FCIP, CLA Ontario Mutual Insurance Association 350 Pinebush Road, PO Box 3187 Cambridge, ON N3H 4S6 Phone: (519) 622-9220 Fax: (519) 622-9227 E-mail: jtaylor@omia.com DISCIPLINE Patti M. Kernaghan, FCIP, CRM Kernaghan Adjusters Limited 300 – 1575 West Georgia St. Vancouver, BC V6G 2V3 Phone: 1-800-387-5677 Fax: 1-800-387-5644 E-mail: pkernaghan@kernaghan.com EDITORIAL Fred Silvestri, BA, CIP NCRS 121 King Street W., Suite 1810 Toronto, ON M5H 3T9 Phone: (416) 733-9265 Fax: (416) 733-0510 E-mail: fred.silvestri@srsconnect.com 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 Gary A. Ellis, BBA, FCIP, RF, FCIAA, CLA, FIFAA Crawford & Company (Canada) Inc. 18 Great George Street Charlottetown, PE C1A 4J6 Phone: (902) 566-1011 Fax: (902) 894-3044 E-mail: Gary.Ellis@crawco.ca W.E. (Ted) Baker, BA, CFE, FCIAA BBCG Claim Services Limited 3660 Hurontario St., Suite 601 Mississauga, ON L5B 3C4 Phone: (905) 279-8880 Fax: (905) 279-5338 E-mail: webaker@bbcg.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

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 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 IBC: LIAISON, LEGISLATIVE & FORMS David McKeon, CIP McKeon & Associates Adjusting Company 2120 Rathburn Road East, Suite 91 Mississauga, ON L4W 2S8 Phone: (905) 602-0321 Fax: (905) 602-4025 E-mail: david@maaac.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 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 NOMINATING Patti M. Kernaghan, FCIP, CRM Kernaghan Adjusters Limited 300 – 1575 West Georgia St. Vancouver, BC V6G 2V3 Phone: 1-800-387-5677 Fax: 1-800-387-5644 E-mail: pkernaghan@kernaghan.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 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 David Porter, LL.B., FCIP, CRM Advance Claims Service Ltd. 206 - 2323 Boundary Road Vancouver, BC V5M 4V8 Phone: (604) 642-0660 Fax: 1-888-452-5246 E-mail: davidp@advanceclaims.com

CIAA REGIONAL PRESIDENTS 2010 – 2011 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 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 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 Crawford & Company (Canada) Inc. 210 – 227 Primrose Drive Saskatoon, SK S7K 5E4 Phone: (306) 931-1999 Fax: (306) 931-2212 E-mail: Lee.Dixon@crawco.ca

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

WESTERN Bea Boutcher, CIP Horizon Adjusters Ltd. #207, 9814 – 97 Street Grande Prairie, AB T8V 8H5 Phone: (780) 402-8383 Fax: (780) 402-7888 E-mail: bea.boutcher@horizonadjusters.com

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

PACIFIC David Porter, LL.B., FCIP, CRM Advance Claims Service Ltd. 206-2323 Boundary Road Vancouver, BC V5M 4V8 Phone: (604) 642-0660 Fax: 1-888-452-5246 E-mail: davidp@advanceclaims.com

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• on the scene OTS The International Federation of Adjusting Associations (IFAA), of which the Canadian Independent Adjusters’ Association (CIAA) is an active member, held the second Regional Claims Conference at the AXA University Campus in Singapore on Nov. 9, 2010. The one-day symposium drew participants from around the world to discuss The Claim Life-Cycle.

IFAA president and conference organizer Paul May of Concordia Consultancy (right) stands with Fred Plant, CIAA’s sponsored delegate (left) and Chartered Institute of Loss Adjusters President and conference presenter, Andrew Homewood. ●

The International Institute of Loss Adjusters (IILA) held its annual general meeting in Singapore on Nov. 8, 2010. Elected to the Institute executive for the 2010 - 2011 term were, left to right: Brent Demnar, immediate past president (Agri Business Consulting Group Pty Ltd, Brisbane, Australia); Tom Moss, secretary (Tenco Services, Inc., Nashville, Tenn.); Ted Wheeler, director at large (National Adjusters Partnership, Sydney, Australia); Fred Plant, first vice president and treasurer (Plant Hope Adjusters, Atlantic Canada); Hakan Ileri, second vice president (Ileri Sigorta Eksperligi Ltd, Izmir, Turkey); and Michael Hale, president 2010-2011 (Carter Insurance Claims Service, Inc., Tustin, Calif.). The 2011 AGM will be held in Queenstown, New Zealand in October 2011. ● Every year Plant Hope Adjusters Ltd honours the Top CIP student in New Brunswick with the Brian E. Taylor Professional Award. Brian Taylor, a guiding light in the p&c claims business who passed away in 2004, was a man of high professional standards and integrity who very much believed in the value of continuing education. The award was named in Taylor’s honour in 2005. The 2010 recipient of this award was Trisha Cormier, CIP of the Economical Insurance Group in Moncton, N.B. Judi Guidry of Plant Hope Adjusters presents Cormier with her well-earned award at the Insurance Institute Convocation held in Saint John, N.B., on Nov. 5, 2010. ● 46

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Members of the International Institute of Loss Adjusters (IILA) gathered in Singapore in November for the Institute’s Annual General Meeting and to attend a seminar on The Claim Life-Cycle hosted by the International Federation of Adjusting Associations (IFAA). Canadian litigation lawyer and umpire, Larry Gilbertson (second from right), chats with IILA Australian members, (l to r), Ted Wheeler, Brent Demnar and Leo Fluitsma during a seminar break.

Photo: Louise May Photography

Greg Thierman, branch manager of Crawford & Company (Canada) Inc.’s Kelowna, B.C. branch, is a recipient of the CIP Society’s 2010 Established Leadership Award.

The award recognizes individuals who have shown exceptional leadership abilities and a strong commitment to upholding the CIP’s tenants of imparting knowledge and instilling professionalism within the insurance industry.

Thierman is one of only three recipients to be named this year.

“Greg has been a lifelong advocate of continuous learning and development, and the CIP Society has now officially recognized his success as a student, instructor and leader in the industry,” said Walter Waugh, vice president of operations for Western Canada.

“His work with charities and fundraising for worthy causes is exemplary.” ●

Have an interesting claims story?

Have valuable advice for adjusters?

?

Claims Canada is always accepting article contributions for consideration.

Please contact Laura Kupcis, editor, with any story ideas at:

laura@claimscanada.ca

www.claimscanada.ca

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Douglas Nathan Hurlbut passed away quietly at St Michaels Hospital on Jan. 23, 2011, after a very brief encounter with cancer.

The Ontario Pond of the Honorable Order of the Blue Goose recognized the passing of Hurlbut. “It is with great sorrow that the Pond learned Gander Doug Hurlbut took his Long Last Flight” the Ontario Pond posted on its web site.

“During his 13 years with the Flock, Doug was a loyal Gander and rarely missed participating in an event.” A celebration of Doug’s life was held in Toronto on Jan. 30. Hurlbut, 64, an avid sports enthusiast, was enjoying retirement after many years of serving as a claims manager with Aviva Canada. Hurlbut began his career with The Co-operators in 1969 and prior to his time at Aviva, he was a claims manager with the Canadian General Insurance Company. “A member of the Quarter Century Club and past president of the Canadian Insurance Claims Managers Association (CICMA), he enjoyed many friends in the industry and will be sadly missed,” the Pond wrote. Hurlbut was the husband of Susan Spierling and brother to Susan Hurlbut-Luna and Randy Luna. A testament to Hurlbut’s positive outlook and true affection towards people: In June 2005 shortly after Hurlbut’s retirement, industry colleagues and friends held a retirement celebration titled ‘Dougstock,’ which saw hundreds of industry reveler’s attend the party at Toronto’s Pilot Tavern, an establishment Hurlbut says he supported over the years. The evening’s entertainment featured performances by various bands and artists, including Hurbut himself. At the event, retirement well-wishers referred to

Hurlbut as a “relationship crusader” and the “kind of guy you want to live next door to.” A ‘Dougstock II’ event was held the following year, in June 2006, for which the proceeds of the event were donated to WICC (Women in Insurance Cancer Crusade). The Honorable Order of the Blue Goose reports that a ‘Dougstock III’ event will be held this spring. ●

Friends of Hughes Amys Barristers and Solicitors gathered at the Irish Embassy for the firm’s annual Holiday Party on Nov. 25. Chuck Jackson, lead singer of Downchild Blues Band, provided tunes to keep the party hopping. ●

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• on the scene OTS Matson Driscoll & Damico Ltd (MDD) hosted its annual American Thanksgiving party on Nov. 25 at the Real Sports Bar & Grill in Toronto. Approximately 350 industry guests attended, raising $3,000 for the Starlight Children’s Foundation. ●

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McCague Borlak LLP welcomed in the New Year by hosting industry guests for their annual ‘Christmas in January’ traditional reception of cocktails and hors d’oeuvres, as well as a chance to tour their newly renovated office space at 130 King Street West, 26th Floor in Toronto. ●

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• on the scene OTS The Ontario Chapter of the Risk & Insurance Management Society (ORIMS) held its Christmas Luncheon on December 16 at the Sheraton Centre Hotel in Toronto.

More than 650 attended. In keeping with the spirit of giving, the ORIMS executive chose to raise funds for The Daily Bread Food Bank. ORIMS president April Savchuk presented a cheque for $7,500 and hundreds of pounds of food to the food bank in support of its fight to eliminate hunger in and around Toronto. â—?

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