An Ontario auto insurer conceded catastrophic impairment the last business day before a hearing - and still avoided a special award and costs.
The Licence Appeal Tribunal decision, released July 7, 2026, gives claims professionals a close look at how a late reversal on a catastrophic impairment determination can survive an award challenge.
The applicant was struck by a vehicle at an urban intersection in May 2022 and sought statutory accident benefits. He was diagnosed with soft-tissue injuries and later reported ongoing pain and anxiety. He applied twice for a catastrophic impairment determination, each supported by a family physician's report.
The insurer arranged several rounds of insurer's examinations. The first set produced a combined whole person impairment rating of 25 per cent, below the 55 per cent threshold for that criterion, and the insurer denied the claim. A second application followed, and a further set of examinations again concluded the applicant was not catastrophically impaired.
Then, on the last business day before the March 2026 hearing, the insurer reversed course. After reviewing updated clinical records, it accepted that the applicant met the criterion for a catastrophic impairment based on mental and behavioural disorders. That concession removed the central issue, leaving the hearing to deal with assessment costs, a special award, interest and costs.
On the assessment costs, the applicant sought the unapproved balance of a determination plan totalling $19,400, of which the insurer had approved $12,400. The vice-chair upheld the insurer. Under the Schedule, an insurer is not liable to pay more than $2,000 plus HST for any one assessment and its report. Charges for an occupational therapist to collect and analyse data, for document review, and for collateral interviews were treated as components of the assessment, not separate services. A second psychiatric assessment fee was refused because one assessment had addressed both criteria, and an enhanced neurological rate had no basis in the Schedule.
The award argument drew the closest scrutiny. The applicant sought a portion of withheld attendant care and housekeeping benefits, arguing the insurer had unreasonably delayed reversing its position. He pointed to an earlier tribunal decision where an award followed a two-month gap between an insurer's reversal and its notice to the insured.
The vice-chair found that decision distinguishable. There was no evidence the insurer delayed telling the applicant once it changed its position, no evidence it withheld documents on purpose, and no basis to conclude the examiners would have found catastrophic impairment earlier. To warrant an award, an insurer's conduct must be "excessive, imprudent, stubborn, inflexible, unyielding, or immoderate." It did not meet that bar.
Costs were also refused. Both sides had filed and withdrawn production motions before the hearing, and resolving an issue before a hearing was reasonable conduct, not misconduct. With no benefits, award or costs payable, no interest followed.
For insurers, the decision signals that reversing a determination after reviewing new records - even late - is not on its own unreasonable, and that assessment fee caps apply squarely to unbundled service line items.
