Definity Insurance Company must fund two treatment plans after Ontario's Licence Appeal Tribunal found its denial letters ignored medical records already in hand.
The dispute was decided by adjudicator Gordon Stencell on written submissions and released June 22, 2026.
The applicant was injured in an automobile accident on February 28, 2022, and sought statutory accident benefits. Definity refused to fund two treatment plans that fell outside the $3,500.00 Minor Injury Guideline limit - a $217.50 balance for chiropractic services proposed in a plan dated November 8, 2022, and a $1,995.33 psychological assessment proposed in a plan dated November 9, 2022.
The fight came down to a single question familiar to every claims handler: did the insurer's denial letters, dated November 15, 2022, and November 23, 2022, comply with section 38(8) of the Statutory Accident Benefits Schedule, which requires an insurer to give the medical and other reasons for a denial?
The applicant argued they did not. The letters, he said, offered no proper medical reasons and never engaged with the clinical notes and records of two treating physicians already sitting in the insurer's file. Definity countered that its letters included a section asking him to submit clinical records, and pointed to an Explanation of Benefits letter dated December 29, 2022, in which it acknowledged an inadvertence - that it had held those records before denying the plans.
Stencell was not persuaded. He found the insurer never explained the inadvertence or why it had not reviewed records sent to it on April 18, 2022, and September 20, 2022. The reasons were confusing, he wrote, because the insurer asked for records it had already received. He also noted the applicant said he never received the December 29 letter, that the log notes contained no reference to it, and that it was absent from the accident benefits file produced on May 28, 2025.
The adjudicator held that both denial notices failed to comply with section 38(8). That failure triggered section 38(11), entitling the applicant to incur the two plans and invoice the insurer - $217.50 for the chiropractic services and $1,995.33 for the psychological assessment - with interest on the overdue benefits under section 51.
The applicant also pressed for a special award under section 10 of Regulation 664, which lets the Tribunal order up to 50 per cent of benefits payable where an insurer unreasonably withholds or delays payment. He asked for the full amount to send the strongest possible message.
On that point, the insurer prevailed. Definity submitted it had adjusted the file in good faith and had not been imprudent, stubborn, inflexible, unyielding, or unprofessional. Stencell agreed no award was warranted. Although the denials fell short of the standard the Schedule requires, he found it was a mistake on the insurer's part rather than the excessive or immoderate conduct that would justify a penalty.
Both findings stand: Definity funds the two plans with interest but faces no additional penalty for how it handled the file.
