Section 33 of the Schedule: When is the Production Request “Reasonably Required”

Introduction
The “duty of an applicant to provide information” section of the Schedule (Section 33(1)1) is a highly effective tool utilized by insurance companies to both adjust their claims and to challenge an insured. An insured runs the risk of a suspension of their benefits if they fail to properly respond in a timely manner to a reasonable request for documents. The case law is rife with decisions in which the insured has failed to comply with their documentary obligations and suffered the consequences of same. Insurers mostly use this section to obtain the documentation they need to properly assess a case. However, sometimes the request for documentation is overly broad and not “reasonably required” as per the Schedule. An analysis of the law in which an insured was not required to provide documentation as per Section 33 will help us assess what is reasonable and what is not.

Section 33: The Basics
Under s. 33(1)1 of the Schedule, an insured person must provide upon request any information reasonably required to assist the insurer in determining the applicant’s entitlement to a benefit. The time period for complying is 10 business days.

The insurer is not liable to pay a benefit during any period in which the applicant fails to provide the insurer with the requested information: s. 33(6). If the applicant eventually complies with the insurer’s request, with a reasonable explanation for the delay, the insurer must pay the withheld benefit: s. 33(8).

Only Necessary Documentation Required To Commence Claim For IRBs
One of the battles regarding documentation often revolves around what is needed at the outset of the claim in order for benefits to be initiated. An insured who has suffered a disability resulting in her being off work often is in desperate need for IRBs in order to keep up with their basic necessities of life. The question is whether an insurer is entitled to a full picture of an insured’s life before commencing payment of IRBs.

In M.M. v. Aviva (2019) 17-006475/AABS the issue was what documents were reasonably required to determine the applicant’s initial entitlement to an IRB. The insurer requested the following documentation and when it was not provided suspended benefits.

        1)      A completed employer’s confirmation form (OCF-2);

        2)      Clinical notes and records from Mount Sinai from April 14, 2017 to present;

        3)      A decoded OHIP summary;

        4)      Notice of assessment from 2016;

        5)      T4’s from 2016 for all jobs worked;

        6)      4 weeks of pre-accident paystubs and/or 52 weeks of pre-accident paystubs; and

        7)      Any post-accident paystubs.

The Adjudicator found that of the documents requested, that the (1) OCF-2, (2) four weeks of pre-accident paystubs or 52 weeks of pre-accident paystubs, and (3) any post-accident paystubs are reasonably required to determine the applicant’s eligibility for IRBs. The remaining items, albeit helpful in determining the applicant’s entitlement to medical and rehabilitation benefits and on-going entitlement to IRBs, are not required to initially determine the applicant’s entitlement to IRBs.

Insured Only Required To Provide Sufficient Answers At EUO
An astute defence counsel at an EUO will often ask detailed questions in order to obtain as much information as possible for the immediate and future handling of the file. The question is whether the refusal to answer some of these questions jeopardizes the claimant’s right to receive his entitlement to income replacement benefits.

In P.I. v. Aviva (2017) 17-000465 the Applicant refused to answer some questions at the EUO on the basis that they were not relevant to the issue of entitlement to IRBs and / or that the insurer already was in possession of the information. The Adjudicator found that the “applicant’s claim for benefits was not barred because she provided sufficient evidence under section 33 of the Schedule”. The adjudicator found that the questions not answered at the EUO did not prevent the respondent from making an informed decision regarding the applicant’s entitlement to IRBs. The Adjudicator found that the respondent had all the information that it reasonably required to make a determination about the applicant’s entitlement to IRBs.

Insurer Cannot Use Section 33 To Deny A Claim After The Fact
If an insurer is relying on section 33 in order to deny an entitlement to a benefit it is obligated to properly advise the insured of same and not as a secondary argument after the fact. For instance, if an insurer medical examiner denied an entitlement to a benefit without requiring further medical records the insurer will have a challenging time proving that this documentation is needed.

As per the decision S.U. v. Wawanesa (2017) 16-003333 the insurer denied entitlement to a treatment plan on the basis that it was not reasonable and necessary. At no time did the insurer advise the applicant that more information was needed in order to determine the entitlement to benefits and the insurer examiners did not indicate that more documentation was required in order to assess the claim for benefits. The Adjudicator found that the insurer’s handling of the claims indicated that the information requested was not “reasonably necessary” for the determination of the entitlement to the benefit. The adjudicator stated that:

“[a]n insurer cannot deny a claim on the grounds that it is ‘not reasonable and necessary’, with no reference to information it has requested under s.33, and then go on to use non-compliance with s.33 of the Schedule as a bar against its liability to pay the benefits in that claim after its decision is appealed to the Tribunal”. 

No Violation of Section 33 If Insurer Could Obtain Records On Its Own Or Insured Acted Reasonably
Insurers quite reasonably request the production of third party records such as the clinical notes and records of a family doctor. This is documentation that is not in the power and control of an insured. Some family doctors are very efficient in producing the records and some are quite the opposite. The question is whether the Applicant is forced to suffer the consequences if this documentation is late to materialize.

In P.M v. Aviva (2020) 18-009518 the Applicant was in breach of section 33(1) as the documentation was not provided within the appropriate time frame but she provided a reasonable explanation for same as per section 33(8). The Applicant established that she had made reasonable efforts to obtain the necessary records and that the insurer had the ability to obtain her records with the consent that she provided early on when she applied for accident benefits. Accordingly it was found that here was no violation of section 33 of the Schedule as (1) the insurer was able to obtain the records that it required on its own, and (2) the Applicant had made efforts to obtain the information.

Self-Employed Litigants Are Not Required To Produce All Records Sought By Insurer Accountant
One the most common disputes regarding the production of documentation revolves around self-employed litigants. Lawyers traditionally have not done well in high school math and often get brain cramps when discussing income tax calculations with accountants. Accordingly, when self-employed claimants receive a detailed list of documentation requested by the insurer accountant it is challenging to know what is actually “reasonably required” by the insurer to calculate the benefits. The Applicant is only required to produce the financial documentation that satisfies the requirements of the Schedule. Further, if the clamant has its own accounting report that sets out the basis of the calculations this is certainly helpful.

In the decision of Applicant v. Coachman (2018) 17-004906 the insurer retained an accounting firm that set-out a list of documentation that it required to be produced in order to calculate the entitlement to an IRB for a self-employed litigant. As stated by the Adjudicator:

“The applicant proved his entitlement to the quantum of IRBs claimed based on the provision of his Income Tax records at the time. I accept that it is reasonable to base IRB calculations on the year prior’s gross business income and that this is contemplated in s. 4(3) of the Schedule. As such, the applicant is entitled to IRBs based on the income tax documents he provided. 

Regarding the continuing requests for further and supporting information from [the accountant] and the insurer, I find, that the applicant is only required to prove his self-employment income in accordance with the Schedule. He has done so. Not only has he provided his income tax returns, he has also provided an accounting report setting out his IRB entitlement based on those income tax records. The continuing requests from [the accountant] for supporting documents (other than income tax records) were excessive.”

Failure To Provide Records Does Not Prevent An Insured From Pursing LAT Application
If an Applicant fails to attend an insurer medical examination without a reasonable explanation it has been found that she is prevented from proceeding with a LAT Application. The question was raised as to whether a similar restriction exists for the failure to provide information as per section 33.

According to the Adjudicator in W.P. v. Aviva (2017) 16-000693 the Applicant is not precluded from applying to the Tribunal for failing to submit to an examination under oath or failing to provide information requested by an insurer that is reasonably required for the adjustment of the claim. Section 33 does not preclude an applicant from making an application to LAT but merely refers to a potential suspension of benefits. Section 55 lists four possible instances of when a proceeding may be prohibited, none of which include the failure of an insured person to attend at an examination under oath or to provide information when properly requested by an insurer. As such, and Adjudicator does not have the authority to order the applicant to attend an examination under oath, nor to order her attendance as a condition for her application to the Tribunal to proceed. A similar decision was rendered more recently in K.A. v. Aviva (2020) 19-002676.

Conclusion
In conclusion section 33(1)1 of the Schedule has been successfully utilized time and again by insurers to suspend and deny payment of income replacement benefits. Most of the time the request for documentation is relevant and great care ought to be taken to utilize best efforts to obtain same. With that said, sometimes insurers are overbroad with their requests and seek information (unintentionally or otherwise) that overstep the boundaries of “reasonably required”. While as much of the risk falls on the insured to obtain the necessary records, insurers should also be cognizant that all because documentation is requested does not mean that there is an obligation to produce same. If an insurer denies the benefit strictly on procedural grounds, without any substantive analysis of same, than this could have significant adverse consequences. In short, the following principals emanate from the case law should be considered by insureds and insurers alike:  

  • it is not “reasonably required” that an insurer has an entirely complete picture of the insured’s life before commencing payment of an IRB;
  • an insured is only required to provide sufficient answers at the EUO in order for the insurer to assess the entitlement to the benefit;
  • an insurer may not use section 33 to deny a claim after it has denied the benefit for a different reason;
  • there is no violation of section 33 if the insurer could have obtained records on its own or the insured acted reasonably;
  • only the documentation that is reasonably required by the insurer accountant is producible;  
  • the failure to provide records as per Section 33 does not prevent an insured from pursing a LAT application

Originally published on the Schneider Law Firm website.

Cary Schneider
Written by

Cary N. Schneider is a co-founder of Schneider Law Firm who specializes in civil litigation including personal injury litigation, real estate litigation, cyber / privacy breaches, and commercial litigation. After working on behalf of insurance companies for 19 years he now uses that inside knowledge to the benefit of his clients.