Sarah Lenssen was injured in a motor vehicle accident on August 30, 2010, involving a vehicle she was driving and a cement truck insured by Intact Insurance Company. Certas Home and Auto Insurance Company, under the Insurance Act, paid Lenssen statutory accident benefits (SABs).
Years later, Certas sought indemnification from Intact for the SABs payments under the loss transfer scheme of the Insurance Act. Intact reimbursed Certas for some SABs but declined to reimburse $392,919.94, alleging gross mismanagement of Lenssen’s SABs claim by Certas.
The dispute proceeded to arbitration under the Arbitration Act 1991, Certas was reimbursed only $32,000 for the Income Replacement Benefits.
Arbitration Findings:
The Arbitrator found Certas did not act in bad faith but agreed with Intact that Certas grossly mishandled Lenssen’s SABs claim, leading to the unreasonable payment of certain benefits.
Mismanagement was identified in Certas' failure to follow up on its plan to reassess Lenssen's entitlement to benefits after she completed her GED and failed to assist Lenssen with vocational rehabilitation.
The Arbitrator decided that if the file had been properly managed, Lenssen’s income replacement benefits would have been discontinued about a year after the completion of her GED, thus Certas was entitled to limited indemnification from Intact.
Conclusion:
The appeal by Certas against the Arbitrator's decision was dismissed, with costs fixed at $7,500 as agreed by the parties. The court agreed with the Arbitrator's reasoning and conclusions, finding no palpable and overriding error in her findings.
