Combining Physical and Psychological Impairments in Catastrophic Impairment

By Roger Foisy on August 23rd, 2012

If suffering serious injuries from an accident, the method for assessing catastrophic impairment should be more inclusive according to an Ontario Court of Appeal decision. An assessment of physical and psychological impairments should be allowed to be combined in determining if someone suffers from catastrophic impairment.

As a result of a serious single vehicle incident in 2001, Robert Kusnierz suffered numerous physical and psychological injuries including the loss of his left leg below the knee and clinical depression. Due to his disabilities he lost his job and sought accident benefits from his insurance company, Economical Mutual Insurance Company, under the Statutory Accident Benefits Schedule (SABS). While both parties agreed that Kusnierz was entitled to some benefits there was disagreement as to the classification of the injuries sustained and the resulting amount of benefits.

In Kusnierz v. Economical Mutual Insurance Company, 2011 ONCA 826, the Ontario Court of Appeal decided that it was appropriate to combine psychological impairments under clause 2(1.1)(g) of the SABS with physical impairments under clause 2(1.1)(f) of the SABS. This combination would go towards determining the ‘whole person impairment’ of at least 55 per cent required to establish catastrophic impairment.

The Court reasoned that this more comprehensive measure “promotes fairness and the objectives of the [SABS] statutory scheme”. Justice MacPherson used reasoning from Spiegel J. in Desbiens v. Mordini, [2004] O.J. No. 4735 (S.C.) which held that catastrophic impairment has a broad and inclusive definition, and reflects the idea that those with the “greatest need of health care” can receive it.

The Ontario Court of Appeal’s statutory interpretation enabling the combining of assessments of physical and psychological impairments addresses the gap in eligibility for catastrophic impairment benefits. Previously, many insurance companies took the position that an insured person could only qualify strictly under one category and not a combination of both (ie: psychological and physical) to be determined catastrophic under the 55% whole person impairment category. As this is clearly an unfavourable decision for insurance companies, there is to be expected future legislative changes that might prevent or further restrict the combining of impairments in assessments. It is an endeavour which will have to balance consumer protection and insurance profits in the form of potential rate increases.

To view my blog about the Financial Services Commission of Ontario’s report on recommended changes to the definition of catastrophic impairment please click here.

Book A Free Consultation Today