Contacted by a life insurance company that says you're a beneficiary?

It may not be the scam it sounds like.

We've been hearing a lot lately from consumers who've received letters from life insurance companies saying that they're the beneficiary on a long-deceased loved one's policy.

The letters often include a form that the consumers need to fill out to receive the money, and the form requires them to provide sensitive personal information.

Not surprisingly, many consumers have been skeptical about these letters. But while it may sound too good to be true, the letters may be legitimate. (Keep reading and we'll tell you how to check.)

Here's the background: Until recently, many large life insurers didn't aggressively research whether policyholders had died, even when the person's date of birth suggested that they were almost certainly dead. (This isn't as easy as it sounds, particularly with records that predate the widespread use of social security numbers as an identifier.) Last year, insurance regulators and consumer groups started challenging the insurers to do a better job.

As a result, many life insurers have started checking the names of policyholders against the Social Security Administration's Death Master File. When the companies find an apparent match, they contact the person/s listed as the beneficiary.

But how to be sure that the letter is real? If you live in Washington state, you can contact us at 1-800-562-6900 or reach us 24/7 via our online complaint and information form. We'll get in touch with our contact person at the insurance company who can verify that the letter you received is legitimate.

If you don't live in Washington, here's the contact information for your own state's insurance regulator, who may be able to help.

Insurance News - Thursday, July 31, 2014

Here are the leading auto insurance headlines from ONTARIO AUTO INSURANCE TOPICS ON TWITTER for Thursday, July 31, 2014:

• It took a while but a Toronto-based staged collision ring has been slapped with more than $800,000 in fines and restitution for false insurance claims that contributed to more than $4 million in fraudulent claims.
• Auto insurance and ridesharing: When personal and business uses of a vehicle converge, coverage confusion arises.
• Men and women can both be terrible drivers but in different ways.
• A look at the public v. private auto insurance debate - which works better?
• Is it true that low highway speed limits mainly benefit auto insurance companies in the form of higher premiums?
• A published study suggests that enforced laws banning texting produced 3% reduction in traffic fatalities for all ages.

Insurance News - Wednesday, July 31, 2013

Here are the leading auto insurance headlines from ONTARIO AUTO INSURANCE TOPICS ON TWITTER for Wednesday, July 31, 2013:

• Ontario auto insurers are setting aside higher reserves because of rising litigation at the same time the government is committed to lowering rates by 15%.
• 90% of customers in Canada are satisfied with the settlement of their auto insurance claim according to a J.D. Power study.
• Toronto police are targeting e-bikes (they don't need to be licensed or insured) in an attempt to enforce HTA and city by-laws.
• A Claims Canada article headline is: MIG: Gone with the wind? Has the Scarlett decision really changed anything?
• Researchers are suggesting that obese drivers are less likely to wear a seatbelt and more likely to be injured in an auto accidents.
• California, New Jersey and Hawaii have auto insurance programs geared to drivers below the poverty line in order to keep them insured.  Would a similar program in Ontario reduce the number of uninsured drivers?
• You know all those stories about the risk of connected cars getting hacked and causing accidents?  Well read this story.
• Good news about drinking and driving campaigns, young Canadians heed the message and are using designated drivers.

Agent charged with theft and forgery; collected commissions for fictitious customers

A former Vancouver insurance agent has been charged with theft and forgery for allegedly collecting about $15,000 in commissions by creating fictitious applicants for insurance policies.

Julie Anne Goss, 43, an independent agent for AFLAC, was arraigned last week in Clark County Superior Court.

The scam came to light after the owner of a restaurant in Battle Ground, Wash. told AFLAC that she’d received premium bills for two “employees” that had never worked there. 

AFLAC investigated, and it turned out that Goss wrote dozens of policies for 15 people that either weren’t employees at the named businesses or apparently didn’t exist. In other cases, she wrote policies for real employees, but they said they hadn't applied for the coverage.

In each case, Goss stood to get a commission for the policy. All told, the investigator found, between August 2010 and January 2011, Goss wrote 91 fraudulent insurance policies and collected more than $15,000 in commissions for them.

The company canceled its contract with Goss in March 2011 and reported the matter to our Special Investigations Unit. After investigating further, we revoked Goss’ insurance license in January 2012. The charges against her were filed in late June.
If you suspect insurance fraud and you live in Washington state, please report it.

The Amount of Fraud in Ontario

The Auto Insurance Anti-Fraud Task Force delivered a Status Update to the government on July 23, 2012. I will be providing a review of the report on this blog. Today I will review the Task Force's efforts to estimate the amount of fraud in Ontario.

At the time of the Interim Report the Task Force was not sufficiently informed to make a quantitative estimate of the extent of auto insurance fraud in Ontario. It did conclude that the figure of $1.3 billion that has been used to describe the cost of auto insurance fraud in Ontario for some time cannot be considered a verifiable measure of the current extent of fraud.

Although not able to measure the extent of fraud, the Interim Report conceptually defined auto insurance fraud in three categories:

Organized Fraud: several participants with different roles within Ontario’s auto insurance system create an organized scheme designed to generate cash flow through a pattern of fraudulent activity;

Premeditated Fraud: a participant within Ontario’s auto insurance system consistently charges insurers for goods or services not provided, or provides and charges for goods and services that are not necessary; the participant is involved in a pattern of fraudulent activity, possibly at the expense of motor vehicle collision victims or possibly with their complicity; and

Opportunistic Fraud: an individual pads the value of his or her auto insurance claims by claiming for benefits or other goods and services that are unnecessary or unrelated to the collision that caused the claim.

The Interim Report reviewed trends in claims cost data and information gathered from industry stakeholders and regulators. This review led to the following conclusions:

• auto insurance claims costs, specifically Accident Benefits claims costs, increased dramatically from 2006 to 2010, and this increase in costs had a direct impact on auto insurance premiums.
• a large and unexplained gap exists between changes in Accident Benefits claims costs and changes in factors that would have been expected to influence those costs; this ‘unexplained gap’ amounted in 2010 to an average of $300 per insured motor vehicle in Ontario.
• the most dramatic increase in costs has occurred in the Greater Toronto Area, where the ‘unexplained gap’ in 2010 amounted to an average of $700 per insured motor vehicle.
• anecdotal evidence suggests that fraudulent activity, and in particular, premeditated and organized fraud may have accounted for a substantial portion of the ‘unexplained gap’.

IBC engaged KPMG Forensic to conduct a study aimed at estimating the extent of auto insurance fraud in Ontario. This study was provided to the Task Force and is available online. The Task Force also engaged Ernst & Young to provide the Task Force with an independent assessment of the KPMG methodology and results. Their study is also available online.

The KPMG study concluded that “there is insufficient information to provide a precise and statistically based estimate of auto insurance fraud in Ontario.” The study did, however, provide a wide range for the scope of fraud. It estimated that the cost could range from 9-18% of annual claims costs, which in 2010 would have amounted to between $769 million and $1.56 billion. KPMG calculated the impact of this estimate of fraud on the average auto insurance premium in the province to be between $116-236 in 2010.

KPMG primarily used the data analytics studies, which combine claims information from participating companies with highly sophisticated tools that can identify suspicious patterns between claims, to develop an estimate of the extent of organized fraud in Ontario. Their report notes that these studies were undertaken by insurers to test the use of fraud identification technologies in their businesses, and not for research purposes.

KPMG was able to extrapolate results from two of the three studies to estimate the scope of organized fraud. The design limitations, in KPMG’s view, made the extrapolations consistent underestimates of the true extent of organized fraud. While recognizing this problem of underestimation, as well as the importance of providing some quantification, KPMG noted that, on the basis of its review of these studies, organized fraud in Ontario was at least in the range of $175-275 million in 2010. The cost of Organized and Opportunistic Fraud could be between $769 million and $1.56 billion annually. KPMG indicated that their estimates are understated because industry-wide data was not used in the studies and excluded certain types of claims.

Ernst & Young has completed a preliminary assessment of KPMG’s report in which it also agrees that organized fraud is likely greater than the range estimated by the data analytics studies used by KPMG.

KPMG has not included Premeditated Fraud in their estimate of total fraud in Ontario.

In addition, Ernst & Young indicated that KPMG’s report may significantly underestimate the extent of overall auto insurance fraud in Ontario because it does not specifically address premeditated fraud, which, as Ernst & Young noted, could range between $130 to $260 million per year. Combining this estimate of premeditated fraud with KPMG’s understated estimate of organized fraud, creates a value of organized and premeditated auto insurance fraud in Ontario of between $305 to $535 million per year (which itself should also be viewed as an underestimate).

Conclusion

Judging from these two reports it appears that the $1.3 billion figure that has been bounced around for years may have some merit. When looking at the combined total of Opportunistic, Premeditated and Organized Fraud it may very well have been above billion dollars prior and up to 2010. However, there is no discussion on the impact of the 2010 auto insurance reforms on fraudulent claims in Ontario. Although it is still early to assess what impact those reforms have had on the sector.

Insurance agent's license revoked; charged with identify theft

Insurance Commissioner Mike Kreidler has revoked the license of a Federal Way insurance agent who forged documents and stole tens of thousands of dollars from a client.

Cecelia Villanueva, who's been selling insurance in Washington since 1994, has also been charged by the King County Prosecutor's Office with two counts of identity theft. Her arraignment is pending. (She's listed in the court filing as Cecilia Cabasco Sawyer.)

In 2002, Villaneuva, sold an annuity that was ultimately worth more than $148,000 to an elderly woman and the woman's neice. She wrongly listed the neice's ex-husband as the primary beneficiary.

The elderly woman passed away in 2005. According to investigators, Villaneuva got a copy of the woman's death certificate, and forging the ex-husband's signature, she filed a claim with the insurer for the annuity proceeds. She steered the money into a bank account that she'd opened in the ex-husband's name, and repeatedly forged his name on checks.

The bank records show that she spent tens of thousands of dollars on groceries, cell phone service, at a drugstore. One of the largest checks, for $6,000, was simply made out to herself.

Eventually, the neice asked about the annuity. Villanueva claimed that due to the poor economy, the value of the annuity had dwindled to just $83,000.

The insurance company that Villaneuva worked for says it is working with the family to repay the stolen money.

Villanueva's insurance license was revoked under the state's insurance laws barring agents from improperly witholding or misappropriating clients' money, demonstrating untrustworthiness, and for forging signatures.

Tacoma insurance fraudster sentenced to two months, restitution

Andre R. Zamora, 25, of Tacoma, was sentenced on July 25 to two months in jail with work release and restitution to all parties in a medical insurance fraud he committed in late 2011.

Zamora was convicted of insurance fraud on July 9 by a King County Superior Court jury after an investigation by Insurance Commissioner Mike Kreidler’s Special Investigations Unit (SIU).

In November 2011, Zamora was involved in a car collision in Tacoma when another driver turned in front of him. After the collision, Zamora sought medical attention at a Renton hospital emergency room and later sought a second opinion from a Bellevue hospital. Zamora then submitted the medical bills to USAA, the other driver’s insurance company, saying he had paid the bills and wanted reimbursement. He submitted three claims to USAA totaling more than $14,857; the actual amount of the three claims totaled $1,621.

Kreidler’s Special Investigations Unit investigates insurance fraud and works with the Attorney General’s Office or local law enforcement—in this case, King County – to prosecute criminal cases. Consumers can report suspected insurance fraud on the Insurance Commissioner’s website.

Insurance News - Monday, July 29, 2013

Here are the leading auto insurance headlines from ONTARIO AUTO INSURANCE TOPICS ON TWITTER for Monday, July 29, 2013:

• Which U.S. city has the worst drivers? According to an informal survey it's Miami followed by Atlanta and New York. 
• Self-driving cars will set off an economic and cultural earthquake. 
• Making best use of social media within the insurance sector.
• British auto insurance rates have fallen by 9.8% after insurers get tough on fraud.
• The provincial government's attempt to address abuse by private clinics in the delivery of physiotherapy to seniors hits a roadblock. These same clinics operate in the auto insurance sector.
• Ontario by-elections are being held this week and Liberals are only leading in one riding. All of the contested ridings were held by Liberals prior to the by-elections.

Proposed Regulatory Model For Healthcare and Assessment Facilities

The Auto Insurance Anti-Fraud Task Force delivered a status update today to the government. I will be providing a review of the report on this blog over the next week. Today I will review a proposed model for regulating healthcare and assessment facilities that operate in the Ontario auto insurance sector.

I worked on the model on behalf of the Task Force and hope that readers of this blog take the time to review it and provide the Task Force with feedback.

The proposed regulatory model is intended to:

• Create barriers for healthcare/assessment facilities that wish to practice in the Ontario auto insurance system based on a "fit and proper" test.
• Sanction participants for fraudulent acts including denying the ability to operate in the Ontario auto insurance sector.
• Evolve HCAI into a regulatory tool to support market conduct regulation and a mechanism to sanction fraudulent behaviour.
• Designate a "regulator" with appropriate powers to oversee the market conduct of healthcare/assessment facilities and coordinate with the health regulatory colleges on issues dealing with professional misconduct. The proposed regulator would be FSCO.

All providers of medical and rehabilitation goods and services as well as providers of independent medical assessments would be covered by this model including:

• Multi-disciplinary treatment facilities
• Regulated health professions who are sole practitioners
• Assessment facilities supporting insurers and claimants
• Unregulated providers who provide specialized medical and rehabilitation services to claimants (e.g., vocational rehabilitation, case management, home modifications)

There would be 3 types of licences issued by FSCO. Licences would be not be transferable.

• Facility Licences for large providers (based on HCAI billings)
• Restricted Licences for providers not owned or operated by a regulated health professional
• General Licenses for small providers

Facility and Restricted Licences would involve a paper application process while the General Licence would involve an electronic filing process similar to the HCAI registration process. Licences would be valid for one year and would be renewed by submitting an acceptable Annual Information Return which would be an electronic filing process that would update the information on file at FSCO.

Facilities would be required to maintain business practice standards set out by FSCO, a combination of Regulations, the existing HCAI terms and conditions, and Superintendent's directives/guidelines. The regulatory health colleges would continue to be responsible for clinical practice standards of the regulated health professions working in the licensed facilities.

Some of the new proposed business standards include:

• No owner, operator, director or practitioner may have a felony conviction (going back 5 years)
• Facility is independent of all insurance companies, claims adjusting companies, personal injury lawyers and paralegal operating in the auto insurance sector
• Clinical Director of a facility with a Facility Licence must be a regulated health professional
• Clinical Director must be on-site for a minimum of 50% of the facility's operating hours
• If the facility is conducting third party medical exams, all practitioners conducting exams must have at least five years of applicable clinical experience and attest that they working within their scope of practice
• Facility will file all fees with FSCO and will not invoice for amounts that unreasonably exceed amounts charged by others for similar goods and services

FSCO will be provided with new authorities with respect to licence applicants and licensed facilities:

• Deny a licence application for failing to meet the required standards
• Investigate complaints regarding improper business practices of licensees
• Conduct risked based audits of licensees
• Issue orders to licensees regarding deficient business practices
  
• Suspend licenses of facilities and/or individuals for fraudulent practices or for ongoing deficient business practices
• Pass on to the appropriate authority when suspected criminal activity is uncovered
• Inform HCAI and Regulatory Colleges of facilities and health professionals that have been sanctioned
• Inform the public of enforcement action

HCAI would have a role in the licensing process. HCAI would be expected to develop a quarterly attestations regarding accuracy and appropriateness of bills submitted through HCAI. Facilities that failed to complete the attestations would have their billing privileges suspended.

Ontario Appeals Court upholds large non-economic loss award decision for young children who lost their mother

Ontario's top court has upheld a jury award of more than 100-thousand dollars to each of two young children for the loss of their mother in a car crash.

The Appeal Court says the amounts may have been high but were still reasonable.

The case involved the death of 30-year-old Michelle Vokes, who was killed when her minivan was demolished by a car driven by Randy Palmer six years ago in Owen Sound, Ontario.

Palmer was driving as fast as 120 kilometres an hour in a 50 zone when he slammed into Vokes.

The awards of $135,000 to the then-three-year-old daughter and $1117,000 to the then-five-year-old daughter $117,000 for the loss of care, guidance and companionship of their mother set new benchmarks. The previous high award to a child who lost a parent in Ontario, $65,000, was awarded in 2011.

read more...

Insurance News - Friday, July 26, 2013

Here are the leading auto insurance headlines from ONTARIO AUTO INSURANCE TOPICS ON TWITTER for Friday, July 26, 2013:

• Ontario auto insurance rates are to come down by 15% this year but they are going up 5% in Alberta. 
• If you think auto insurance fraud is bad in Toronto well Britain is considered the "whiplash capital of the world" with £1.1 billion in fraud in 2012.
• Then there is the Italian mafia gang making millions from car crash insurance scams.
• A cyclist found guilty of manslaughter for running down a pedestrian; could be the first such conviction in the U.S.
• The age of the connected car will bring new safety, comfort — and the threat of your car getting hacked.
• Did you know that different genres of music affect driving habits? So insurers may want to avoid drivers who listen to heavy metal and sports talk radio.

"I need insurance. Who would you recommend?"

We get this question all the time. And sorry, but we can't steer you to a particular agent, broker or insurer. We're the state agency that regulates the insurance industry in Washington state, and in that role, it's not our place to endorse particular companies or agents.

That said, we do have some online tools that can help you pick who you want to deal with.

We have this agent and company lookup, where you can find local agents, companies that sell specific types of coverage, etc. If you look up a company, you can also see the number of complaints by year. And the agent/broker listings include any disciplinary actions taken against that person.

If you want to find out how many complaints we get about particular insurers, here's our complaint comparison tool. It helps you find out out how insurers compare to one another. You can compare health insurers, for example, or auto, or life, etc.

And because market share varies dramatically, we include a "complaint index" that makes it easier to make apples-to-apples comparisons between different companies.

Lastly, it's always a good idea to double-check by running the name of an insurer, agent or broker through our disciplinary orders database. It goes back to 2002, and includes details on violations, fines, and other orders we've issued.

Health premium rebates coming soon to some Washington consumers

The Affordable Care Act requires health insurers to spend more of the premium they collect on patient care and quality improvement activities or pay a rebate back to consumers.

How much you ask? Well, it depends on the insurance plan you selected. Only two insurers in Washington state's individual market didn't meet the new standard (called a medical loss ratio) - Regence Blue Shield of Oregon  and Time Insurance Company.

A total of $792,846 in rebates will be disbursed to 9,605 consumers in our state. Amounts may vary, but the average rebate per family is $122.

If you're enrolled with either of these insurers, you should expect to hear from them in the next several weeks. Premium can be refunded in one of the following ways:

• Send a refund check in the mail.
• Deposit a lump-sum reimbursement to the same account that was used to pay the premium.
• Reduce your future premium.

FSCO Mediation Backlog Will Soon Be Eliminated

Between 2007 and 2012 FSCO experienced an unprecedented 99 per cent increase in Applications for Mediation (from 14281 to 28,389), which resulted in a substantial backlog of files.

FSCO successfully implemented an aggressive action plan to address the backlog. This included initiatives such as the eCalendar, Consent Failures, mandatory settlement blitz days, and the use of a private service provider to supplement FSCO’s mediation and arbitration services. As a result, the mediation backlog has been substantially reduced from 29,142 files at the end of March 2012. In fact, the backlog will be eliminated by the end of August 2013.

 

source

How to find an old life insurance policy (and other unclaimed property)

We get a lot of queries from people looking for old life insurance policies that they think might have named them as a beneficiary.

Here are some quick tips. For more specifics and links, please see our brand-new "how to find an old life insurance policy" web page.

• Try to track down as much information as possible. You'll presumably know the name of the policyholder (any name changes?), and it also helps to know the state or states that the person lived in.

• Ideally, you'll be able to locate a copy of the policy itself, which will have a number on it. But sometimes there's a wrinkle: the insurance company or its name may have changed, especially for older policies. That can be a challenge, but your state's insurance department can probably help you track down the current company information. If you live in Washington state -- we're the state insurance regulator there -- feel free to call us at 1-800-562-6900 and talk to our consumer advocacy staff.

• If you can't find the policy, try going through the person's financial records, looking for payments made to an insurer. Also, look through old mail: the company may have sent periodic statements or billing reminders. It's also worth checking with the person's auto- or homeowners insurers, since people sometimes buy life insurance from the same company.

• You could opt to pay a search company to run a check for the person's name through industry databases or send queries to a large number of insurers.

• If a policy goes unclaimed for a long time, insurers are supposed to turn the money over to state-run unclaimed property programs. They hold the money, often forever, in case someone files a claim. You can easily run the person's name through these free, state-run online search sites. Washington state's is at http://ucp.dor.wa.gov, and you can easily find other state's unclaimed property programs at www.unclaimed.org.

• One other important tip: Many life insurance policies automatically end at a certain age.  

My kid's delivering pizzas in his car. Does he need extra insurance?

Sorry, but the answer's usually yes. Most personal auto insurance policies won't cover you if you're getting paid to use your own car to transport people or property for business purposes.

In general, you'll need to buy a business or commercial auto insurance policy if you are a health care worker who occasionally uses your own car to take clients to appointments. The same is true if you use your own car to deliver flowers, newspapers, pizzas, etc.

If you have questions about your coverage -- and policies do differ -- contact your agent or insurance company directly.

Insurance News - Wednesday, July 24, 2013

Here are the leading auto insurance headlines from ONTARIO AUTO INSURANCE TOPICS ON TWITTER for Wednesday, July 24, 2013:

• Deloitte report, Insurance Tech Trends 2013: Elements of Postdigital, says a convergence of five technology trends - analytics, mobile computing, social media, cloud computing and cyber liability - ultimately will reshape the way the insurance industry operates.
• Ministry of Health plans to shake up private physiotherapy sector on August 1 by diverting physiotherapy OHIP funding for seniors away from some large players (like Achieva, Centric Health) to LHNs and CCACs.
• U.S. consumer group says blue-collar workers and those without college degrees pay more for auto insurance.
• Paper by CNI Health Services: Malingering of Psychiatric Problems, Brain Damage, Chronic Pain, Controversial Syndromes in a Personal Injury Context. 
• American Civil Liberties Union claims that police are using licence plate readers to track and collect data on American motorists' location.  As a result, enormous databases of innocent motorists’ location information are growing rapidly. 
• Ontario Liberals are falling behind in recent polling and will likely lose at least 2 seats (in Windsor and London) in August 1st by-elections.  So will a Liberal set back impact on a possible fall election?
• On a related note, are the summer by- elections an exercise in voter suppression to give the Liberals a better shot at holding on to these ridings?

Standing Committee on Finance and Economic Affairs Auto Insurance Hearings - Day 3

The following are summaries of presentations made on July 10, 2012.

Ontario Trial Lawyers Association
Andrew Murray

On the issue of catastrophic impairment changes the perspective that I have to offer is from my review and summary of the freedom-of-information data.

We’ve heard the superintendent and from Minister Duncan comment that it’s all about science and getting the medical science right. When you take a look at the minutes from the expert panel group and some of their weekly commentary, which is not information that was ever disclosed publicly—it’s clear that it’s much more vague than how it has been presented in terms of this being a consensus viewpoint, certainly in terms of this all just being about the science.

Almost all of the panel members made comments, initially, indicating support for the notion of combining mental and physical impairments together when looking at the whole-person impairment. That ultimately did not form part of the recommendations, but when you look at the commentary, you can see that they were struggling with this. It almost looks like there was, for some reason, some arm-twisting going on.

With respect to whether or not the current definition for brain impairment, being a Glasgow coma score of nine or less, was appropriate, the initial dialogue between the eight panel members resulted in only three of them strongly disagreeing or disagreeing, so sort of being against that notion. It begs the question that if their initial impression was that it’s probably an adequate tool, why have the need for a change to make something more complicated?

When asked to provide recommendations for improvement to the definition of catastrophic impairment, one of the comments was this: “One thing is certain: It is not always better to change a system without understanding the consequences of implementing new rules.”

On the issue of combining—this is combining mental and physical impairments—one of the comments was this: “To enshrine the prohibition to quantify is arbitrary, discriminatory and inaccurate.” I note that the Court of Appeal has more or less made similar comments, but on the expert panel itself, certainly this individual supported the need to combine mental and physical impairments.

Pierre Côté, who was the chair, had this comment: “How things are done in the field is beyond the scope of this project.” So, expert panel, don’t be concerned about what actually happens in the field. It’s a huge issue but not required in order to make recommendations on the definition. We say, of course, that that is wrong-headed and that you must have regard for what’s going on in the trenches before you make any of the changes.

Willie Handler, who was involved at the time, noted that the cost impact of what the expert panel was analyzing was not part of the discussion. That was off the table. It wasn’t something that they were to consider. It will be a discussion that the government will be undertaking later.

I now want to make some comments about the superintendent’s recommendations, because that’s new from the time of my last appearance. Something that was new was the recommendation by Mr. Howell to have family physicians sign all of the insurance forms for ongoing treatment and therapies for individuals who have a catastrophic impairment. There are some significant flaws with that approach. First off, as we all know, many people do not have a family physician. Even those who have a family doctor will fill find that the doctor is very disinterested because they’re busy.

Phil Howell is to be commended for hearing the stakeholders when they said that you cannot make hospitalization in an in-patient rehab facility a prerequisite to passing any of these various definitions.

I want to end this segment of my talk reflecting on the interim catastrophic impairment designation, because the expert panel said that there needs to be some mechanism to get benefits in a timely way to those who need them, and they came up with the interim catastrophic impairment designation. Mr. Howell, unfortunately, seems to have hollowed out the spirit and intent of that recommendation by restricting any interim benefits, seemingly for all categories, attendant care and medical rehab, to an additional $50,000. This interim benefit, essentially, for those who have an interim catastrophic designation, would simply restore a benefit that people had 15 years ago.

What are OTLA’s main criticisms with the proposals that have been put forward by Mr. Howell? We say it is far too complex. If these recommendations are accepted, we now have injected into the analysis the American Spinal Injury Association classification of spinal injury; the extended Glasgow outcome scale for traumatic brain injuries; the global assessment of functioning for psychiatric disorders; and a very long list of psychiatric impairments.

I can tell you that whenever you add new tests like this, which incorporate external documents, you’re injecting uncertainty, you’re adding unpredictability to the system, you’re going to increase the disputes.

Our other main criticism is rebutting the suggestion that this is all just based on good science. I’m hopeful that the excerpts that I reviewed with you from our freedom-of-information request show how even the expert panel didn’t feel that this was all about good science. You may use some scientific measurements to assist you, but when it comes down to figuring out where on a spectrum someone sits, it’s basically a policy decision.

The last point that I want to make, then, relates to the need for data and the type of data that this group should insist on having and should use your powers to obtain in order to make properly informed decisions.

Hughes Intelligence Investigation Services
Barry Bentley
Ron Prior

The Ontario Auto Insurance Anti-Fraud Task Force December 2011 interim report identified four key areas which they believe need to be addressed—prevention, detection, investigation and enforcement—to successfully combat fraudulent activity and its effect on automobile insurance premiums and related health care expenses in Ontario. We agree with this finding, along with the need for consumer awareness of fraudulent activities.

In our experience, it is essential to establish a central control unit which utilizes all available police and private investigator resources in Ontario to reduce fraudulent activities.

Mr. Justice Archie Campbell recommended that police meet required core competencies. We recommend that a similar approach be taken to combat fraudulent automobile insurance injury claims, including health care fraud. To meet this objective, we recommend the following:

—adopt a criminal investigation technique similar to those developed by the United States Health and Human Services Office of Inspector General;

—develop a central and regional insurance fraud control unit and certification programs;

—implement a health care fraud investigation certification program for investigators, adjusters, service providers and all others involved in insurance fraud assessment, review, prevention, detection, investigation and enforcement;

—apply statistical and artificial intelligence fraud detection techniques to existing data banks. Remove barriers to data mining by certified fraud investigators;

—explore the development of a special roster of crown prosecutors specializing in handling insurance and health care fraud cases.

[For anyone reading the Hansards transcripts there is a quote from Mr. Paul: Basically, an insurance company right now can’t walk into a chiropractor’s office or a physiotherapist’s office or a healthy-equipment supply place and say, “You’ve billed us. We want to see your invoices or we want to see your records.” They can’t do that right now. I feel compelled to provide a correction. O. Reg. 194/11 amended the SABS to include provisions (ss. 46.1, 46.2 and 55) that enhance the ability of insurers to seek verification of invoices received for goods and services provided to claimants. Those amendments came into force on July 1, 2011.]

Dr. Michel Lacerte

I want to give you my perspective as a busy treating physiatrist, which is a specialist in physical medicine and rehabilitation, and also the perspective of a rehabilitation counsellor and, on occasion, a disability management policy analyst.

I would like to stress that when we’re talking about all of this, we’re talking very much about private sector rehabilitation, and I have strong views in terms of strengthening the public health care system that basically treats everybody equally.

Since the beginning of my practice in 1990, being trained in the US, I clearly identified the Americanization and lawyer-ization of service delivery in Ontario. You see many American companies where services that are being provided in a gunshot approach, which is basically you come in the door and you can have access to all sorts of treatment, not just the physio, not just the chiro. What is important is that in contrast to the US system, we do not have strong utilization management controls.

Hospitals have been creative and have been offering their own private services. The reason why, in many cases, they move them out quickly is so that they can get other services—the other door. Hospitals right now can go in direct competition with the folks and in many cases will take away the folks who were providing physiotherapy, for example, to the public and will put them instead to provide services now that can be billed to insurers.

What is important for me is that when you look at rehabilitation right now, we’re really facing what I would refer to as a Chinese buffet, because basically you can have all sorts of services; there’s no limit. You want to have aromatherapy? You want to have a colon enema?

What we see is that the family doctor, as was referred to earlier, is oftentimes not equipped or remunerated to try to do the case management, so by default in many cases, plaintiff lawyers basically have hijacked the whole rehabilitation service delivery in Ontario.

I agree, when we were talking about for catastrophic, that there should be—the family physician maybe is not the best person, but at least make it a physician. To raise the case manager to be the one doing it—many of them have no background; they may be social workers, and they’re generally selected by the plaintiff attorney—is absurd. I would certainly not support this.

Katherine Worotny

I am a brain injury survivor. I’ve come to talk to you today from a survivor’s perspective on the changes to the catastrophic definition and what that means to other survivors and to drivers in Ontario who may one day be in a crash.

Back in 2001, I was a founding board member of the Brain Injury Association of Windsor/Essex County, and 11 years later I’m still an active board member. As our local survivor representative to the Ontario Brain Injury Association advisory committee, I go to Toronto five times a year. My job is to bring survivor concerns locally to the provincial level.

Before my car crash I was a teacher in life skills and I was a supervisor of six educational assistants and had 21 mentally and physically handicapped students in my class. I spent eight years in rehab. Today, 19 years after my car crash, I still do some therapies. I never went back to my career as a teacher. I do volunteer work with the Chrysalis Day Club and I volunteer at Hôtel-Dieu trauma services.

I want to just end this by saying I understand that the proposed changes to auto insurance may make it harder for people who are seriously and catastrophically injured to get benefits, including the medical and rehabilitative benefits that they need. This means that they will look to the public system and they will go without therapy. This is troublesome. After an accident or a car crash, people want to get better. I am an example of how, after a crash, someone can be rehabilitated and is able to give back to the community. Without therapy, paid for by my car accident insurance company, I would not be where I am today.

On behalf of car crash survivors like myself, I would like you to consider how changing the definition and making it harder to get benefits after a crash will affect other crash victims like me.

Honourable Howard Pawley

I should say that in 1969, the newly elected Premier Schreyer contacted me and said, “I want you to look after the red-hot-button issue: automobile insurance.” We established a committee called the feasibility committee—feasibility insofar as whether public automobile insurance ought to be established or not. We travelled throughout the province. We heard from Manitobans. When we returned, we recommended the establishment of public automobile insurance.

Subsequent to that, I became the minister who was responsible for introducing it in the Legislature. It was enacted, and I was the first chair of the Manitoba Public Insurance Corp., so I do come with a certain amount of bias this morning, because of what has been a very positive experience.

When the decision is made to establish compulsory and universal coverage, it follows that there must be an obligation on the part of government to provide auto insurance at the lowest possible price.

The most effective way of comparing auto insurance programs from province to province is to look at how much of every premium dollar is returned to the ratepayer in the form of claims payments and benefits. This gives us an apples-to-apples comparison. Recent published annual reports illustrate how the administrative costs of the public plan avoid costly administrative duplication and are only one half as much as those incurred by private insurance companies. Public plans return a maximum return of each premium dollar of 85 cents to 90 cents—that’s administrative costs. With private plans, the administrative costs range from 65 cents to 70 cents on the premium dollar.

Since 2002, Manitoba’s auto insurance cost has increased at a much lower rate, 1.5%, as compared to the countrywide performance of 5.3%—3.5 times less than the national average. Last year and this year, MPI returned just over 90 cents on the dollar.

The inclusion of basic compulsory automobile insurance with the licence plate is the most efficient and economically capable method of delivery. Supplementary auto insurance is also available from either government plans or from private auto insurance companies.

For example, a 21-year-old male with a clean driving record living in Ontario would pay more than six times the rate that we charge, and in Alberta, it would be 2.5 times what the province of Manitoba would charge.

Why do public, driver-owned, public-profit auto insurance plans win, hands down, over the private auto insurance systems? Provincial insurance corporations, as the owners of public auto insurance, have every political reason to reduce accidents and claims by insisting on safer driving conditions for their motorists, and pursue traffic safety and loss-prevention programs.

In Manitoba, there is no discrimination based on age or sex. Bad motorists are surcharged additional dollars on their driver’s permit. That is a fairer way than discriminating based on sex or age.

This past year, the Public Utilities Board ordered that a dividend be paid to Autopac customers, which means a $338-million rebate, plus lower rates for most. The dividend gave motorists varying amounts of rebate. It’s not unusual for them to range from $250 to $350 for that one year.

Ontario and other provinces have legislated reduced benefits, unfortunately and sadly—and this where the catastrophic comes in, where I think it’s basically wrong in principle—where there has been legislation of reduced benefits by putting caps on payments to the victims of crashes in the hope rates will come down, but rates haven’t come down elsewhere.

In Ontario there exists a minor role for regulatory bodies in respect to rate applications. There must be an appropriate and strong regulatory body to examine the following issues:

(1) It should examine significant cuts in coverage in auto insurance, resulting in the introduction of deductibles and caps in respect to awards and general damages. Can we be assured the insurance companies are passing all these savings on to the motorists?

(2) Are there costs or expenditures included in rate calculations for Ontario for losses, for adverse experiences encountered in other jurisdictions, including other Canadian provinces that operate with private insurance? If so, should we object to any such inclusion?

(3) Is the investment income properly reflected in the rate calculations and being used to reduce premiums or increase benefits?

(4) Is there industry creaming taking place? Some companies offer very low rates by limiting their business to only the least risky motorists. The result of this can be highly unfair rates to younger and risk-prone drivers.

(5) Do the rates charged in the various regions reflect the loss experience in that particular region?

(6) Are private companies promoting accident benefit programs, as they do in western Canada, where governments, as the owners of public auto insurance, have every political reason to reduce accidents by insisting and encouraging safer driving conditions for their motorists?

Victoria Cross

I’m a general practice lawyer here in Windsor.

I want to make three points. I recommend that this committee expand its mandate to include serious, intense, short-time-limited public review of the various public models of auto insurance in Canada for the express purpose of developing a made-in-Ontario public auto insurance plan. Second, I want to debunk a few myths and misunderstandings about auto insurance. Third—and this may be even the most imperative—I am going to make an appeal for this committee to take strong recommendations on the comprehensive European trade agreement, so all of Ontario’s future or potential public enterprises and present ones are protected before it’s too late.

The Financial Services Commission of Ontario is preparing for its mandated five-year review of services. All of the auto-insurance-related objectives in its most recent statement of priorities and strategic direction can be met with convening such a public review, and such objectives may be easily amended to include such a review without having to, I believe, go to the Legislature on the matter.

We’ve had 20 years to review our no-fault system and deal with successive periods of increases, regulation and re-regulation. Some can argue that Ontarians prefer our much-revised, modified tort and enhanced no-fault insurance system. This is how it’s provided. Wrong: Insurance providers prefer it.

Injured parties in auto accidents need to be treated as whole beings. It is wrong to return, through the back door, to the days when psychological benefits are limited, and we are left with a meat-chart vision of a person, relying on a capped percentage of impairment. We need lower rates, and rates that will continue to be affordable for persons who are low-income. Fewer young people are choosing to drive, or have chosen to put off learning to drive, due in part to the cost of insurance.

I know that in other provinces, there are perhaps three to five territories. In this province, there are 55 territories available to insurance companies, some of which could be as small as 2,500. That I got from the testimony from May 28. I think that’s something that—you know, the FSCO has been rubber-stamping these requests over and over again. I do not support narrowing territories as a tool to discriminate against drivers. All decisions, and the primary decisions, should be made on the individual driver’s risk. It shouldn’t be about age; it shouldn’t be about marital status or gender.

Driver-based fees are the best way to be fair. Individual driving records should be the predominant, if not the only method, of determining rates. A tort component, I believe, must remain in the system to ensure justice for people.

I do want to say something very important. International agreements will not keep us from setting up a plan. The Lord government retreated in part or in whole because of fears about NAFTA and GATS. That is only true if we let those fears take over. The left and the right in this province have been captured by their own rhetoric about what these trade agreements will mean for insurance. According to Steve Shrybman and Scott Sinclair, NAFTA and GATS are navigable concerns.

CETA involves the provinces in decision-making in a way that NAFTA and GATS do not. The province of Ontario unfortunately has not taken the time or interest, or perhaps has decided not to involve itself in the CETA process.

Brain Injury Association of Thunder Bay and Area
Janet Heitanen
Karen Pontello

The Brain Injury Association of Thunder Bay and Area, which is the regional representation of the Ontario Brain Injury Association, would like to present the following concerns regarding the changes to the cat determination for individuals with traumatic brain injuries, referred to later in this report as TBI.

In supporting people who have sustained brain injuries in motor vehicle collisions, we believe that individuals require a system that emphasizes integrity in the areas of access, accountability, fairness, transparency, consistency and expertise as outlined below.

(1) Access to medical and rehabilitation care: Individuals with TBI require access to care that is available to them in a responsive and timely manner. Individuals require care that addresses their needs at the point in time when it is important for them. In order to access care, funding from their accident benefits must be available for medical and rehab services. The stipulation on the proposed interim cat determination that requires individuals to be treated in an in-patient neurological facility, outpatient rehab program or day-patient rehab program may limit access, particularly if these rehabilitation services are not immediately available in the larger centre of Thunder Bay or if the interest of the individual is to stay in their home community, which is in the rural areas in the district.

The proposed change for removing the Glasgow coma scale used for cat determination, for TBI individuals who are impaired in completion of their daily activities, considering work and other activities, and who are left with a choice of working and being limited in other activities or completing other activities and being unable to work, may no longer meet the catastrophic threshold using the Glasgow outcome scale extended. Without the cat funding available, these individuals will place increased burden on the OHIP system when the non-cat $50,000 limit is depleted.

The proposed change for limiting the combining of impairments and determining cat designation related to whole person impairment is problematic. Individuals who suffer mild to moderate TBI, along with other psychological impairments such as depression, post-traumatic stress disorder and orthopaedic injuries, deal with the combined effect of each impairment on a daily basis.

(2) Accountability, fairness and transparency: Individuals with TBI require their insurance companies to be accountable and fair in managing claims based on medical rehabilitation need. Insurance companies are not responsible for determining need. The management of medical and rehabilitation benefit under the SABS requires transparency so that individuals can receive services to manage the brain injury even when the insurer questions individual need. The ability of the insurance company to question need is considered okay if the individual can continue with services until the need is determined not to be required based on expert opinion.

(3) Consistency: Individuals with TBI require their insurance company to maintain consistency of care as they manage the claims process. For example, a claimant receiving medical and rehabilitation services should have these services continue while insurance examinations are being conducted. For individuals with significant injuries, consistent services are required to maintain the gains achieved in treatment. It is not clear how continuation of services will be addressed as cat determination is being reconsidered with the interim cat designation.

(4) Experience and expertise: Therapists and practitioners treating individuals with TBI and those completing insurance examinations should be using the same frame of reference when assessing individuals’ medical and rehabilitation needs. It is not okay for insurance examiners to have less experience than the treating providers, as opinions may not be reliable or consistent.

Dashcam foils auto accident scam

This "accident" actually took place on Highway 401. The video below shows the view from Herman Sham's vehicle. He appears to come to a stop, and the car in front of him appears to roll backward and strike his vehicle. Sham is seen getting out of his vehicle to discuss the situation with the driver in front, Raguruban Yogarajah. According to Sham, Yogarajah demanded a $500 payment, or he would call the police.

Sham explains in the video that rear-end collisions are generally assumed to be the fault of the driver in back, and that without the dashboard camera, he would have had no way to prove his innocence, and he would have faced an increased insurance premium.

Because Sham captured the event on video, it was Yogarajah who ended up in trouble. According to the Toronto Star, he was charged with fraud, attempted fraud, and public mischief. Yogarajah denied the charges, saying that he was not sure who was at fault, but now realizes that, because his vehicle has a standard transmission, it rolled backward when he thought he was at a stop.

Without the cam it would have been one driver's word against another and who would have believed some would intentionally back into you on the 401? It illustrates how powerless we all are when pulled into a scam like this.

Eastern Washington storm damage and insurance claims

Large parts of eastern and northeastern Washington suffered significant storm damage on Friday, when high winds and heavy rains ripped through the region, toppling trees, cutting power lines and damaging cars and homes. Flash floods also damaged some areas.

As homeowners, businesses and vehicle owners pick up the pieces, here are some key things to know about insurance claims:

Direct damage to insured structures by wind, wind-driven debris and falling trees is generally covered under standard homeowners and business coverage.

As for vehicles: If you have comprehensive coverage, that will also generally cover damage to a car or truck from falling limbs, etc.

Immediately contact your agent or insurer, who can help walk you through the claims process. If the damage is severe enough that you cannot remain in the home, your policy may include some coverage for temporary living quarters.

Flood damage is usually only covered if you had flood insurance. Contrary to what many people think, flood coverage is NOT part of a standard homeowners policy. In Washington, the first stop for flood coverage is often the National Flood Insurance Program, a federal insurance program sold through local agents.

As for the damage, be sure to take pictures. Avoid making permanent repairs or discarding damaged property until claims officials can document the damage or loss. If you can safely do it, try to minimize further damage, such as covering broken windows.

Here's a more-detailed list of tips for filing an insurance claim after a natural disaster.

OIC seeks candidates for legal division, consumer protection

We recently posted two job opportunities at our Tumwater office.

The first is an Insurance Enforcement Specialist, a civil service-exempt position in our Legal Affairs division. We are looking for someone to provide legal perspective to employees and to lead agency work groups in specialized areas of insurance law, rulemaking, legislation and strategic planning. This position, along with other staff in Legal Affairs, works on enforcement of state insurance rules and laws and participates in case work, hearings and court proceedings. The person in this position will work closely with assigned counsel from the state Attorney General's Office and will collaborate with representatives from other state agencies and partner organizations.

Candidates must have a degree from an accredited law school, be licensed to practice law in Washington state and have a least six months of administrative litigation experience. Desired qualifications include experience with complex state or federal regulations and familiarity with insurance law, financial examinations, auditing or accounting. The position is open until filled. View the full description and apply at careers.wa.gov.

The second position is a Functional Program Analyst 4 working with the property and casualty unit in our Consumer Protection division. The person in this position will help educate consumers about insurance in Washington and will help consumers resolve disputes with insurance producers. This position acts at the subject-matter expert on insurance and disasters and will support the agency's liaison to the Washington Emergency Management Department. The person in this position will also work with the division's IT liaison on live chat and business processes.

Candidates must have a bachelor's degree or additional qualifying experience substituted year for year and specific experience with consumers, compliance and governments. This position closes on Aug. 4. View the full description and apply at careers.wa.gov. 

Insurance News - Wednesday, July 23, 2014

Here are the leading auto insurance headlines from ONTARIO AUTO INSURANCE TOPICS ON TWITTER for Wednesday, July 23, 2014:

• Car crash scams are becoming increasingly sophisticated with the latest wrinkle involving organized groups gaining access to medical clinics to cash in on lucrative payouts for phony insurance treatments.
• Auto insurance fraud is more frequent and sophisticated, with organized groups replacing individual fraudsters.
• Ontario's efforts to reform the insurance sector and clamp down on fraud in the Toronto area have not slowed the problem of staged car accidents.
• There seems to be a debate going on as to whether self-driving cars will mean less traffic or in fact more congestion.
• Google may be ready to launch self-drivering cars in the near future but they may be more than 10 years away because we're just ready for them.

COBRA and Medicare: How to avoid a common (and costly) mistake

If you're continuing your employer health coverage through COBRA and you become eligible for Medicare, it's important for you to sign up for Medicare during your Medicare eligibility period.

Here's why: Health insurers generally include language in their policies that says they can refuse to pay bills if they find out that you stayed on COBRA coverage after you were eligible for Medicare.

A lot of consumers get caught in this trap. Many people who are on COBRA don't know that they should sign up for Medicare when they become eligible. Instead, they assume that COBRA will continue to pay their medical bills, so they delaying signing up for Medicare until their COBRA coverage ends.

Then, months after becoming eligible for Medicare, they find out that their COBRA plan is refusing to pay for medical care that the consumer already received. They can't backdate their Medicare enrollment, so they're stuck with those medical bills. Yikes.

Don't get caught in this trap. If you're on COBRA and become eligible for Medicare, sign up.

Information and resources for people who are affected by Washington wildfires

Wildfires are burning in several areas of Central and Eastern Washington, triggering a state of emergency. As of this morning, according to Washington State Department of Natural Resources, 1,200 homes have been evacuated in 12 towns. Sections of Highway 2 and State Route 20 are closed while crews battle the largest wildfire in the state’s recorded history.

For news and information from agencies and organizations involved in the fire response, follow Gov. Inslee’s wildfire list on Twitter. For breaking news about the fires, follow #waWILDFIRE. Gov. Inslee also has a webpage with Washington wildfire resources.

OIC has tips for filing a claim after a natural disaster and how to find disaster resources.

The Property Casualty Insurers Association of America (PCI) issued guidance to residents who are affected by wildfires in Central and Eastern Washington:

• Policyholders who have lost their homes to the fires are immediately eligible for additional living expense (ALE) coverage which may reimburse for increased living expenses such as, lodging, clothing, toiletries and other necessities. Policyholders who are evacuated for a period of time by state or local officials, and do NOT lose their home, may also be eligible for ALE reimbursement if the home next door is damaged by fire, and civil authorities prevent you from returning to your home. Remember to keep your receipts so it will make the claims process easier.
• Report all damage to your insurance company or agent as soon as you can in order to settle your claim more quickly and accurately.
• Make a list of all of the damage and any resulting expenses. Keep receipts for anything you buy so you can submit them to your insurance company later.
• A homeowner should not throw things away until an insurance company representative has had a chance to assess the damage and make a claim report.

Consumers can also seek help with their insurance or ask insurance-related questions by calling our consumer advocates at 1-800-562-6900 or contacting us electronically.

Insurance News - Monday, July 22, 2013

Here are the leading auto insurance headlines from ONTARIO AUTO INSURANCE TOPICS ON TWITTER for Monday, July 22, 2013: 

• One outcome of Superstorm Sandy was a drop in consumer satisfaction following a high number of total-loss auto insurance claims.
• Not only is Detroit bankrupt but it is a city where no one has auto insurance.
• Rhode Island governor signs bill limiting when insurers can declare a car a total loss into law to the strong objections to the insurance industry (see July 11 Insurance News update).
• Britain's Competition Commission will investigate auto insurance industry practices regarding physical damage repairs which has alleged to have increased premiums by £225 million a year.

"My doctor says I need a treatment, but my insurer won't cover it. What can I do?"

Q: "My doctor says that I need a particular medical treatment, but my health insurance company won't cover the cost. Is there anything I can do?"

A: Yes, there definitely is. Contact your health insurer, tell them you want to file an appeal, and ask what you need to do to start the process.

Then collect materials to support your argument, such as letters from your doctors describing why this is the best treatment for you, any medical journal articles or studies showing the treatment's effectiveness, etc.

You may also want to point out the health problems that will or can arise if the company doesn't pay for the treatment. Be sure to provide and estimate of the costs of treating those problems, especially if those costs would be significantly higher than paying for the treatment.

After you send in your appeal to your insurer, don't give up. Most people don't win the first round, but the odds of winning increase as you reach higher levels of appeals. The change of winning is highest when your appeal reaches the final level, called an "independent review organization."

For more tips on appeals, including templates, sample letters and detailed pointers, please see the appeals section of our website or call our consumer advocates at 1-800-562-6900. (If you live in a state other than Washington, please contact your own state's insurance department.)

Standing Committee on Finance and Economic Affairs Auto Insurance Hearings - Day 2

The following are summaries of presentations made on July 10, 2012.

Structured Settlements Group
Douglas Mitchell

My family has been in the insurance business since 1933. I started in 1970, mainly in claims, and by 1985 was primarily negotiating structured settlements. A structured settlement uses a special annuity that enables the defendant insurer to guarantee tax-free future payments to a claimant, saving the defendant insurers in Ontario hundreds of millions of dollars.

There are four full-time structure brokers in Ontario and all are paid by commission when they place the funds for the annuity with a life insurance company. With the changes to the act in 1996 and subsequent, adjustors and lawyers have increasingly relied upon structure brokers to provide quotes on the cost of buying tax-free annuities to cover each of the types of future needs as a basis from which to start negotiations.

Preferred brokers have refused to split commissions with the claimant’s brokers. They say they can represent the best interests of both sides at the same time so the claimant does not need their own expert. The general insurance companies refuse to pay bills submitted as a disbursement by a claimant lawyer for independent structured settlement advice.

This process, over several years, has caused the claimants’ lawyers to be unable to consistently secure independent structure calculations and advice, leaving them to accept whatever calculations and technical information the defendants’ preferred broker suggests.

Some time ago, I undertook to help at least one claimant lawyer each month, even if I knew that I would not be paid. The result was shocking. Out of the scores of cases, there was a mistake on virtually every case, and only once was the mistake in favour of the client. The claimants’ preferred brokers are consistently making mistakes and including assumptions that favour their client, the defendant insurance companies. These mistakes have been as large as $600,000 on a single case and would have gone undetected if it were not for my gratuitous participation in the case.

This situation was prevalent in the United States about 10 years ago and, once exposed, led to many lawsuits against defendant insurance companies. The United States’ industry leaders forced a change to the structured settlement practice, acknowledging that each party is entitled to independent expert advice, and if both sides engage structure brokers, those brokers will share the commission equally.

Insurance Brokers Association of Ontario
Gerry Kylie
Bryan Yetman

I’m sure that most people here understand the difference between brokers and insurers, but I’d just like to reiterate for those who do not that, as brokers, we need to work closely with insurers, but our mandate is to represent our customers’ interests to the insurance companies.

Insurance is a complex product, and I feel, and the law requires, that consumers need and get expert advice tailored to their own individual needs when purchasing the product. My aims and goals will sometimes differ with those of the insurance companies, as my prime responsibility is to advocate on behalf of the public and serve my customers to the best of my abilities.

With respect to the auto insurance fraud and abuse situation, we have to get auto insurance rates under control. I believe the single most important thing that can be done to lower claims costs and thus insurance premiums is to tackle fraud and abuse in Ontario’s auto insurance system, particularly in the accident benefits area.

The Auto Insurance Anti-Fraud Task Force recommendations are scheduled to come out later this year, and I want to urge the government to implement those recommendations as quickly as possible. However, please, let’s not get into a major overhaul of the system. I’ve worked through three different major overhauls of the system in my career, and we don’t need a fourth. What we need is to give the 2010 reforms an opportunity to work. They appear to be having some effect, but we do need to proceed with action on the abuse front. Even with those reforms, don’t be deluded into thinking there are excess profits in the auto insurance area.

In 2005, the Ontario government banned the use of credit scoring in the rating of auto insurance. Shortly after that, many insurers began circumventing the ban by refusing to offer quotes to those who refused access to their credit information. This was finally brought under control by the 2010 auto reform package, which defined use of credit as an “unfair and deceptive practice.” What the insurers have now done is used credit scoring much more aggressively on their property products, which basically subverts the ban. Many consumers buy both property and auto products from the same carrier to take advantage of multi-policy discounts. We have had situations where companies increased their property premiums dramatically—for example, from $900 to $2,200 for house insurance—due to credit scoring, which forces the client to go elsewhere, and thus they divest themselves of an auto policy they don’t want in the process. We have to stop this back-door effect on the automobile consumer. My concern with this is that more and more property insurers are using credit scoring, and soon there won’t be an elsewhere to go.

Ontario Psychological Association
Dr. Amber Smith
Dr. Brian Levitt

In Ontario, psychologists see patients with traumatic injuries under WSIB, auto insurance, victims’ services etc. We’re employed in hospital programs for chronic pain, depression, anxiety disorders, schizophrenia, cognitive impairments and brain injuries. Also, we cannot bill OHIP directly.

With respect to auto insurance, car accidents are the single biggest cause of civilian post-traumatic stress and brain injuries. Psychologists provide the most effective treatments for post-traumatic stress. Psychology is the only profession able to measure and diagnose cognitive impairments due to brain injury.

We tend to be involved with the most seriously injured and vulnerable, we work with high-need victims who have brain injuries and psychological disorders, and we provide services that are critical for recovery and disability prevention. Historically, in terms of the data in Ontario, that’s 2% to 4% of accident victims.

MVA victims with psychological conditions tend to have higher levels of disability. It’s the burden of comorbid conditions, when you combine mental and behavioural with physical impairments. Co-occurring mental and physical disorders create a greater burden on the system, suffer due to shortages of services for mental illness and brain injuries, and then there’s often offloading to the public system, such as CPP, Ontario Works, public housing, prisons, etc.

What we have currently is evidence-based guidelines for assessment and treatment services that are billable under auto insurance in Ontario. They were developed by more than 20 psychologists from around the province and passed by the Ontario Psychological Association board of directors. They are not accepted by the insurance industry. We see consistent denials of everything that’s consistent with these guidelines.

What is working: The anti-fraud task force is working. The college of psychology is part of the professional identity tracker. Many psychologists are now able to track who is billing in their name for whom they’re not working, so we’re really glad for that. HCAI provides utilization and cost data. It should be able to identify outliers that can be investigated. It should make transactions more efficient and reduce transaction costs.

Now, what’s not working: Our assessment and treatment plan approval process is not working. We’re having more denials, more disputes, more delays. There are no reasons given for the denials, no communication with the providers, and the whole process has become far more adversarial.

What do we need to do? Let’s reinstate timelines for decisions so people aren’t lost in this grey zone. Reinstate deemed approval provisions. Improve adjuster education. Ensure approval for plans that are consistent with our evidence-based guidelines. Require communication between insurer and patient or provider prior to denial of service.

We’re getting IEs by other professions. As psychologists, it’s weird to get a second opinion from a GP or a nurse. Decisions that don’t make sense: They don’t understand our guidelines; they’re approving and denying things that we can’t do. Let’s ensure we have appropriate experts for IEs.

Also, the minor injury definition is too blunt an instrument. Cost control is obviously working and there is greater buy-in. The problem is, it’s being used indiscriminately. We have patients every day with clearly documented concussions, brain injury and post-traumatic stress being restricted to the minor injury guideline. This is inappropriate. It’s supposed to be for sprains and strains.

We support the intention in the superintendent's report to introduce elements of evidence-based medicine to the Ontario automobile insurance system. One of the recommendations we have is a simple change in the language in the report from “psychiatric” to “mental and behavioural.” This is most consistent with current research, evidence and practice, to refer to disorders as “mental and behavioural,” not as “psychiatric,” which is a professional designation as opposed to a description of a disorder.

Also, we would like to see a more appropriate threshold for mental and behavioural impairments as comparable to physical impairments. I raise this because in the superintendent’s report, the threshold appears to have been increased or the bar appears to have been raised for mental and behavioural in relation to physical and is discriminatory. We think there should be a shift in the GAF from 40 or less to 50 or less, which would be much more consistent with the other catastrophic definitions.

Another recommendation is to include mental and behavioural impairments in an overall whole-person impairment rating; in other words, to combine all impairments of the whole person, not just physical but mental and behavioural, and that this can be done very easily with a conversion table, that is evidence-based, in the California workers’ comp system.

We’d like to see the removal of the requirement of a restrictive list of specific diagnoses from the mental and behavioural criteria, because this is discriminatory. However, if a specific list is required, we’d like to be included in the process of generating a guideline for it.

Also, allow psychologists to conduct—that is, as lead examiners—examinations for determination of catastrophic mental and behavioural impairments: This is what we’ve done since the inception of the SABS catastrophic, but have been excluded since the 2010 reform.

Then include psychologists among those who may complete applications for catastrophic mental and behavioural impairments and sign the OCF-19s, which, again, we have been able to do since the inception of the SABS and since 2010 have been excluded.

Also, remove the language in terms of any requirements for publicly funded or community-funded services from the definitions, because this does not fully incorporate the reality that there is private funding being used for rehabilitation services.

Ontario Brain Injury Association
Tammy Dumas
Steve Noyes

OBIA is a provincial not-for-profit charity which speaks on behalf of survivors of brain injury, of which there are approximately 500,000 in Ontario. OBIA does not provide direct rehabilitation services to people. Therefore, as an organization, we are not directly impacted by the proposed insurance changes. However, our main priority is to advocate on behalf of people living with brain injury to ensure that they receive the reasonable and necessary services that they are entitled to in order for them to achieve the best possible quality of life given their circumstances.

OBIA is very concerned with the proposed changes in the superintendent’s report on the definition of “catastrophic impairment.” It is our position that the proposed changes from the current definition will be detrimental not only to the severely injured, but to the general population, as services previously covered by insurance will fall to the taxpayer and those utilizing OHIP will be on a longer wait-list for required services.

OBIA is very concerned with the proposed changes in the superintendent’s report on the definition of “catastrophic impairment.” It is our position that the proposed changes from the current definition will be detrimental not only to the severely injured, but to the general population, as services previously covered by insurance will fall to the taxpayer and those utilizing OHIP will be on a longer wait-list for required services.

OBIA has many members who have never spent a day in an in-patient rehab facility, outpatient or day program, but do have severe brain injuries that meet the current definition of catastrophic brain injury.

There are already long wait-lists for in-patient, outpatient and day programs, and by adding this criterion, the proposed changes will only increase the long waiting times for treatment on an already significantly stressed system.

Another concern is the onus on front-line medical personnel to facilitate the admission to outpatient and day programs. The matter to consider is that the requirement for admission to a neurological in-patient centre, outpatient or day program puts the onus on front-line personnel—ER doctors, family doctors etc.—to recognize and diagnose a brain injury but also to facilitate admission into a facility.

The exclusion of community-based rehabilitation programs: The proposed definition completely leaves out the numerous brain injury survivors who seek assistance only through community-based rehab programs. In many cases, these programs are just as valuable and are more cost-effective. Under the proposed definition, these brain injury survivors seeking that type of support would be left out.

We believe that a brain injury survivor who sustains a mild or moderate brain injury, resulting in psychiatric symptoms along with the physical impairment, should not be excluded from being able to combine impairments.

A final concern OBIA has is making family doctors as gatekeepers on treatment and assessment plans. Currently in Ontario, there are almost one million people who do not have a family doctor and will not be able to access any care.

Health Service Management
Viivi Riis

As a physical therapist with more than 30 years of professional practice experience, I’ve treated many people with injuries suffered in automobile collisions. My experience includes services provided at the request of insurers as well as by plaintiff lawyers who represent victims of injuries caused through another party’s negligence. I have obtained a master’s degree in rehabilitation science, with a focus on health services research, and I’ve published three peer-reviewed articles related to the delivery of health services in the private and auto insurance health sectors.

My experience in this field has confirmed to me that claimants, or patients, who can access the right resources at the right time to recover maximally have a better quality of life and tend to participate more fully with their families, the labour market and society at large. At the same time—and this is a very critical point to remember—it’s axiomatic that demand for health care funding will always exceed supply.

The government is faced with a delicate balancing act to weigh the need of injured persons for effective health care with the need of drivers in Ontario for affordable and available auto insurance.

I think these are important if the government wants injured Ontarians to receive evidence-based health services that promote a return to the individual’s pre-accident activities and reintegration into their families, the labour market and society at large.

It’s my opinion that most health professionals are very well-intentioned and want to do the right thing for injured persons. But the system is very complex. This complexity and the influence of other stakeholders such as insurers and lawyers has created confusion and misguided behaviours. Much attention is paid to how much and what kind of treatment is available to injured persons, but very little attention has been placed on whether all that treatment in fact helps the injured person.

Another source of irritation for injured victims is when two medico-legal reports come to conflicting opinions, something that has also been cited by presenters in these hearings and others. This is a very common problem when we have an adversarial system.

There is an absence of consequences for poor health outcomes, and part of the reason for this is that there are no consequences for health professionals if the treatment they deliver doesn’t actually help to improve the injured person’s functioning.

It’s naive to ignore that there are financial incentives built into the system, and these incentives reward prolonged or unnecessary treatment. For example, colleagues of mine, health professionals, have told me of cases where plaintiff lawyers have instructed them to continue treatment, even when that professional has recommended discharge.

There has also been an expanding definition of reasonable and necessary, and I think this language has been problematic, because it’s not concisely defined anywhere for medical professionals. Since I began practising in the auto insurance environment in 1992, there has been a dramatic change in how health professionals perceive the concept of reasonable and necessary.

We often hear that after the first few months after injury, more treatment is important, but in fact, the science tells us that this is not the case. There is new evidence that suggests that in the early stages after minor injuries, less treatment tends to be more effective, so I think it’s very important to consider funding models.

I do have a recommendation about scientific evidence used to support treatment type, dose and duration, and to examine fee-for-service models. I think fee-for-service models tend to reward health providers for a lot of treatment, but they don’t reward health providers for achieving good health outcomes, so if we can look at a shift in funding models, I think that could be valuable.

Collision Industry Information Assistance
John Norris

I am one of the contractors that helped design the Ontario Ministry of Transportation’s stolen and salvage inspection program for shops in Ontario. We have over 500 collision repair shops that are inspection stations that are inspecting rebuilt vehicles to ensure their safety and legitimacy—i.e. they are not stolen—going on the roads of Ontario. I’m also the administrator for the Vehicle Security Professional Program in Canada this year. It just started in Canada after four years in the US, on behalf of the 18 car companies in Canada that import and manufacture in this country, and the after-market technicians. That program provides security data from the manufacturers directly to a qualified tech to fix the car.

Please remember that in all the discussions you’ve heard of treatment plans and bodily injury claim costs, it’s the collision repair shops who are the first to see the car and often the customer. We can tell if the vehicle was damaged now or earlier. We can tell if an accident may not have happened or had been staged. We know if the tow operator tried to sell the collision. We know if the tow operator obtained personal and private customer information so they could sell that information to a treatment clinic.

Shops tell us of abuse details, of tow truck operators selling collision work for a kickback and selling private, personal information of the car accident victim to get their $2,000 commission from the treatment clinic all the way to demands for kickbacks that shops must pay to keep repair work in their shop. Even the parts companies that supply the parts to repair your accident collision damage must pay in kickbacks.

Not a single shop owner would come with me today because they’re too scared to appear with you and be seen in public. They believe that any testimony or presentation to you today on what actually happens after a car accident—what they go through, what they see every day—would be used to shut down and isolate their businesses to the point of business failure, and they simply cannot afford to be blacklisted.

There are treatment clinics that issue commissions of $2,000 to tow drivers who will transfer private, confidential data on accident victims to them. We interviewed a tow driver who makes two calls a week and he gets $125,000 a year. All the rest of that is kickbacks.

The clinic then immediately contacts the accident victims. They advise them that they are an insurance-preferred supplier or an insurance industry provider. Then they’ll set up an expensive treatment plan. They haven’t met the victim yet.

There are tow truck drivers and operators who push for their kickback as they sell the collision-damaged car to a body shop. Those repairs across Ontario now cost the shop, because the shop now seeks to recover the extra dollars paid to the tow operator.

In order for a shop to generate the extra revenue to pay back that chaser, the insurer gets billed for work that wasn’t done; repairs with used or stolen parts that were billed as new; outrageous bills for storage; environmental fees; drop-offs; moving fee; $300 to move the car on the lot; $500 for a piece of cardboard under the vehicle to catch any oil drips; $35 to allow the customer one phone call. If the customer decides to take the car somewhere else for repair: days of frustration, thousands of dollars having to be paid in release fees because that kickback has to be paid somehow.

Kickbacks are demanded by insurers, who often have a huge marketplace dominance and make decisions that determine whether your shop is going to survive or not for up to 10% of the price of the repair as a commission charged to send them their own customers’ business.

Insurers demand that parts be ordered based on a list of suppliers given to the repair shop. No longer can the repair shop deal with suppliers they built up a long-standing relationship with, but they must deal, instead, only with the supply firms that provide a kickback to the insurer.