The importance of knowing what to do with EI benefits for IRB purposes

In the LAT decision released July 18, 2018, C.M. and Aviva General Insurance (17-005910/AABS), the Applicant received a special award in the amount of 50% of the total IRB amount in dispute, in addition to the IRB benefits already received due to amounts being unreasonably withheld from the Applicant.

From June to November 2015, the Applicant was employed as a labourer for a construction company.  Commencing November 2015, the Applicant was laid off from work due to the seasonality of the industry.  As such, the Applicant began receiving regular employment insurance benefits.  Accordingly, at the date of the accident (i.e. February 11, 2016), the Applicant was receiving employment insurance benefits and continued to receive these benefits until June 5, 2016.

From February 18 to June 10, 2016, Aviva paid an IRB to the Applicant, however at an incorrect weekly amount.  Aviva deducted the employment insurance benefits received when calculating the Applicant’s weekly IRB.  The applicant disputed this approach to calculating the IRBs, however, on May 13, 2016, Aviva sent correspondence to the Applicant stating they had correctly calculated the IRB considering Section 7(1), (3) and 4(1) of the SABS.

Section 7 of the SABS allows an insurer to deduct certain amounts from an IRB.  However, Section 4(1) (a)(i) of the SABS specifically excludes deducting post-accident employment insurance benefits from an IRB.  It was not until the Applicant was no longer receiving employment insurance benefits that their IRB was adjusted by Aviva, however only on a go forward basis and not for the disputed period of February 18 to June 10, 2016.

Aviva agreed to pay the correct weekly IRB amount for the period February 18 to June 10, 2016 only once the Tribunal application had been filed. While Aviva corrected the weekly IRB amount, the Applicant argued that there was an unreasonable delay that warranted a special award.

The Tribunal agreed with the Applicant and awarded an amount to be 50% of the disputed amount for the period February 18 to June 10, 2016.   Aviva conceded they misinterpreted the SABS and made a mistake, however no explanation was offered why it took so long to correct the mistake.

Read the decision in full detail here:

17-005910 v Aviva General Insurance