General Legal Issues
In this section you will learn about a variety of legal issues that are common to ICBC injury claims. You will also get some helpful information about settling your ICBC claim. Further, you will learn about the interplay of an ICBC claim and your disability/ extended health insurer. Finally, you will learn some interesting points about jury trials.
Heads of Damages
In this section, you will learn about the type of claims you can make when another driver causes you injury because of their negligence. These heads of damages are not available if you cause the accident. The various heads of damages are available in more severe injury claims but in minor claims, where full recovery is expected, you are generally only looking at non-pecuniary damages, past wage loss and out-of-pocket expenses. Even then, as of April 1, 2019, the amount of non-pecuniary damages payable is restricted to $5,500, adjusted for inflation, if your injury claim is categorized as a “minor injury”.
In most cases where you suffer an injury that was caused by the negligence of another motorist, you are entitled to a claim for non-pecuniary damages. That is a legal term for an award of damages because of pain and suffering along with loss of enjoyment of life.
In 1978, the Supreme Court of Canada capped the amount of non-pecuniary damages that you can recover in a personal injury lawsuit at $100,000, adjusted for inflation. By the end of 2018, the figure is around $382,000 being the maximum recovery in Canada for any injury. Therefore, even the most severely injured person (e.g. severe brain injury with quadriplegia) only gets $382,000 for non-pecuniary damages.
For accidents following April 1, 2019, if ICBC and/or the CRT designate your injuries as being a “minor injury” you are only entitled to $5500 in pain and suffering adjusted for inflation. You can be rest assured that ICBC will be aggressive on trying to place just about every injury claim in this category to save substantial amounts of money on the backs of injured victims. For a full review of the new no-fault scheme introduced in 2018 please review the previous section of this book.
Assuming your claim is outside of the “minor injury” category or the accident predates April 1, 2019, the amount of non-pecuniary damages is usually determined by way of legal case precedents. In other words, the amount that Courts have awarded for similar types of injuries in previous cases is used to determine the award for your case. The difficulty can be that other cases may have some similarities but will also have many differences. There is seldom a single case that you can point to that is similar on all fronts. Therefore, the best approach is to find some relatively similar cases and argue a range of non-pecuniary damages.
If you do not want to pursue your claim through a lawyer, the best thing to do is go to the government web site (https://www.courts.gov.bc.ca) and search this judgment database to find similar cases.
The problem with finding similar cases is that they may not have an influence on ICBC if you are self-represented. ICBC tends to “lowball” self-represented individuals offering a fraction of what the claim is worth even when faced with compelling evidence to support the claim.
Soft tissue injuries usually bring $1000 to $1500 for every month the claimant is injured. A two- year lasting injury should bring $30,000 to $40,000. For a chronic pain case, judgments are in the range of $60,000 to $85,000 and sometimes up to $140,000.
Before settling your ICBC claim, you need to consider the amount of your past wage loss claim. The gross loss of wages you suffer is not the amount of compensation you will receive through ICBC.
To start with, ICBC is only required to pay you the net amount of your wage loss after factoring in your income tax obligations if you had made the income as well as your Employment Insurance premiums you saved by not making the income.
ICBC can deduct several different wage replacements benefits you have received over time to further reduce the amount of past wage loss owing. To start, they can deduct any temporary total disability benefits paid under Part VII. For accidents after May 17, 2018, you need to fully pursue all income replacement sources such as private insurance plans, Employment Insurance, CPP and Government disability programs. The reason being, ICBC can deduct income replacement benefits paid or payable from the tort claim. That is, ICBC can deduct payments you received as well as payments that you should have received if you had taken all the necessary steps to receive the income replacement benefits.
If the accident occurred before May 17, 2018, ICBC had very limited ability to deduct any of these income replacement benefits.
The next argument ICBC may raise is that you were off work for longer than you should have been. While making this argument, ICBC will ignore medical evidence supporting your disability even if they do not have their own medical evidence to support their argument. Unsupported positions taken by ICBC like this one will often force individuals to seek out legal representation.
Another argument from ICBC is they will only pay past wage loss based on reported income only. However, if you have unreported income, you can still make a claim that you lost income because of the accident. The law is clear that so long as you can prove the amount of the loss you are still entitled to it, even though it did not form part of your reported income on your tax return. Therefore, do not allow ICBC to ignore this part of your past wage loss claim especially if you have clear proof that you lost the opportunity after the accident to continue to receive this unreported income. The proof should be in the form of documents or statements from client/employer(s).
In addition, ICBC often argues that past wage loss should be based on the net income of the business if you are a business owner or entrepreneur. This is not the case at all because everyone knows that individuals are able to write off quasi-personal expenditures to lower tax implications. ICBC should not have the advantage of your tax saving endeavors and should pay the true loss.
Finally, when it helps them, ICBC will rely on past earnings and ignore the prospect of pay raises or promotions. However, a promotion or pay raise that you would have received, but for the accident, should be factored into the past wage loss claim.
A future loss of capacity claim is a claim for loss of opportunity to earn wages into the future because of the permanent nature of the injuries from the accident. The claim is still available even if you have returned to your pre-accident employment after the accident. This is because the law is clear that where your injuries have a permanent nature to them and preclude you from working at certain occupations, you are still entitled to a future loss of opportunity award even though you are back to your pre-accident employment. The theory goes that at some point in your future, you may not continue to work at your pre-accident employment but try some other employment. If your injuries preclude you from working at a certain job or group of jobs, then you are entitled to compensation.
The claim for future loss of capacity is easier to make out where you have returned to some employment since the accident, but you are not working to the same extent that you were before the accident. Also, if you are still unable to work at the time of the trial or settlement due to the injury suffered in your accident, a future loss of capacity claim is clearly available.
ICBC does not easily agree to provide a future loss of opportunity award in any settlement even when faced with clear medical evidence supporting the loss of capacity to work in certain jobs. ICBC will most often adjust the file on the basis that, with the passage of time, the individual will be completely recovered and not missing any time off work in the future.
If you are self-represented, the chance of getting an allowance for loss of opportunity in the future from ICBC in any settlement is low. Therefore, if your injuries give rise to a future loss of capacity claim, you need legal representation.
ICBC is required to pay some of your out-of-pocket expenses, called special damages, reasonably incurred because of the injuries suffered in the accident. They generally require you to produce receipts which substantiate each expense.
For accidents that occurred before May 17, 2018, ICBC pays the entire amount of any reasonable special damages. For accidents after May 17, 2018, you must exhaust funding from private insurance sources or from government assistance programs before ICBC is required to step in and cover the reasonable special damages.
On accidents after April 1, 2019, ICBC only must pay for treatment expenses up to an amount set by ICBC in the Regulations. Unlike in the past, ICBC no longer must pay the injured victim the full cost of the treatment in the settlement/ judgment if the therapist is charging more than the prescribed rate set by ICBC, which is almost always the case given that the ICBC rates are below industry standards. In other words, the injured victim is now forced to cover the “user fees” which could very well be $20-$100 a session.
The result of this new policy is that the injured victim is now getting shortchanged as he/she can no longer get full compensation for treatment expenses from ICBC. This will invariably result in far less treatment for most injured victims involved in a car accident after April 1, 2019 as most individuals do not have spare money to pay for treatment especially when the person may be off work due to the car accident as well. It remains to be seen whether ICBC will follow this harsh legislative change and resist paying for part of the treatment necessary for an injured person to get back to normal.
Unfortunately, many individuals do not do a very good job of keeping receipts for various expenses. Hence, ICBC gets away with not paying a lot of out-of-pocket expenses. For example, how many people who go to the pharmacy and purchase Tylenol or Advil because of pain keep the receipt and submit the receipt to ICBC?
The best way to keep records is whenever you incur any expense reasonably attributable to your injuries, get a receipt and put the receipt in a folder for safekeeping. At the same time, keep a spread-sheet of the expenses incurred. It is worth your effort as this practice will maximize your recovery of special damages.
The other thing you should do is keep track of the number of medical and therapy visits because you are entitled to a mileage claim to and from the medical/therapy centre.
There is no limit on the out-of-pocket expenses you can submit in an ICBC claim so long as the expenses are reasonable and medically necessary to deal with the injuries suffered in the accident. The fact that you are spending money on getting better helps your claim because ICBC will have a harder time arguing that you have failed to mitigate your damages by trying to get better through exercise or treatment. Also, the more you spend on your claim, the easier it is to illustrate the severity of your injuries to ICBC. In fact, it is anticipated that the amount of necessary treatment will have a significant influence on whether ICBC can categorize your post April 1, 2019 injury as a “minor injury” to restrict your non-pecuniary damage claim to $5,500, adjusted for inflation.
The United States has developed a system where the amount paid out on any injury claim is correlated to the amount of medical expenses incurred by the injured party in his/her recovery. ICBC does not work under the same practice but hints of the United States system do creep into the decision-making process at ICBC.
If possible, you should follow your doctor’s advice and try to fund the treatment necessary to help you in your recovery. The expenses could include going to therapy, hiring a housekeeper, purchasing prescription medication, etc. Make sure you discuss the treatment plan with your family doctor and don’t simply rely on the therapist to tell you what is necessary because ultimately you need a medical doctor’s support for any treatment you are receiving. The word of a therapist is not enough.
One word of caution is that ICBC will not pay for excessive treatment and therapy. In some instances, a therapist may over-treat the patient. When the therapy expenses become very high (well over a few thousand dollars) ICBC often will deny paying the entire amount of the claim. This is particularly so when you are going for passive treatment such as massage therapy or chiropractic treatment. The Courts are also hesitant to award a large sum of money for passive treatment. In the result, there are limits to the amount of treatment that you should incur in your case, particularly passive treatment.
Having said the above, as a rule of thumb, if the treatment is being recommended by your family doctor chances are it will be difficult for ICBC to avoid payment of the treatment expense.
In summary, if you want to maximize your recovery for out-of-pocket expenses incurred because of your injuries, accurate record keeping is essential. The more you can spend on reasonable out-of-pocket expenses the better off you are in your ICBC claim because the expenses illustrate the severity of your injuries and prevent ICBC from arguing that you failed to mitigate your damages by not following treatment recommendations. Avoid excessive treatment and make sure that you continually monitor your treatment plan with your family doctor.
In more serious ICBC injury claims, where there is permanence to the injuries, you may have an entitlement to an award for future care. To receive an award, you require a medical opinion that concludes that the expenses in the future are reasonable and medically necessary.
Therefore, you require a written opinion from a doctor discussing the level of future care needed. You also need an occupational therapist, who is an expert in assessing future care, to provide an analysis of the cost of the future care recommendations.
The type of items that can be awarded under future care is virtually unlimited. The list includes such things as gardeners, homemakers, care aids, counselors, babysitters, therapists, etc. So long as the expense is reasonable and medically necessary, you can claim it.
The award that ICBC is required to pay for future care is the net present value of the stream of future expenses. Usually, an economist must be retained to figure out what the value of the future stream of expenses will be if you get a lump-sum payment at the time of the settlement or trial.
ICBC will sometimes argue that the amount of future care should be reduced by what is available under Part VII of the Regulations. The reason being, the Insurance (Vehicle) Act allows ICBC to deduct past and future Part VII benefits from the tort claim award. With the introduction of the no-fault scheme starting for accidents after April 1, 2019, ICBC may well force more claimants to stay in the Part VII program as opposed to settling out the entire claim and closing the file.
Voluntarily allowing ICBC to deduct Part VII benefits from the future care award in exchange for leaving Part VII open should be avoided because you don’t want to be thrown into the situation of having to deal with ICBC for care needs indefinitely. There is a real advantage to both ICBC and yourself in terminating the entire relationship when the case is settled, or judgment is rendered.
If a homemaker is injured in a car accident rendering him/her unable to pursue the various household chores that he/she once did for the family, there may be a loss of housekeeping services award. Alternatively, an award for a replacement housekeeper may be advanced in the past and future care claim.
In most situations, ICBC resists this sort of claim just like they try to resist other future heads of damages. The claim is only applicable in a situation where an individual suffers lasting injuries rending him/her partially or fully disabled from providing homemaking services.
It is unlikely that ICBC will pay this head of damage to a self-represented person so to pursue this claim you will need a lawyer. Also, usually an economist provides the calculation as to what the loss entails for the future.
In relatively few cases there may be a claim for the inability to get married. This is in a situation where the injuries are catastrophic and make the claimant less likely to be able to find someone that is prepared to spend years being their caregiver and wife/husband.
The theory behind this head of damage is that if an individual is unable to get married then the cost savings of having another individual in the household are lost. If this type of claim applies to you, you will need an economist to calculate the loss because this is a very complicated calculation.
In cases where an injured party receives a sizable award for future damages, tax gross-up and management fees can be available. ICBC generally resists paying such a claim on the basis that they can force a structured settlement. A structured settlement is where an annuity is purchased and provides for an annual stream of income, which is nontaxable. Please see the section on structured settlements.
1. Tax Gross Up
This claim is based on the fact that if an injured party gets an award now for a future loss, the injured party will have to pay taxes on the investment income over time. The amount of the tax gross-up award is basically compensation for having to pay taxes on the investment income.
To make a claim for tax gross-up requires an economist to consider your income tax returns and the size of the award and then come up with a calculation on the amount of taxes you would have to pay over your lifetime. Obviously, a layperson without a lawyer will have a difficult time advancing such a claim.
2. Management Fees
The Courts may award an amount for the injured party to hire an investment manager to manage the award, especially if the injured party has little or no investment experience or that individual suffered a severe brain injury in the accident. The reason for this award is that an injured party receiving a large future award needs to invest it to ensure it lasts a lifetime.
Over time, the Courts have been less and less likely to award money under this head of damage simply because if you hire an investment manager, the expectation is that you can do better than the “real rate of return” (i.e. better than inflation) so the amount you pay the investment manager will be offset by the extra gains the manager gets you on your investment. Hence, there is little or no loss to you.
In addition to receiving an award or settlement of damages for such things as pain and suffering, past wage loss, out-of-pocket expenses, future care and future loss of capacity, there is also a claim available to a successful party in a lawsuit called “taxable costs and disbursements”.
Taxable costs are not available unless you have started a lawsuit. Taxable costs are the amount you can receive based on a tariff scale, which is established by the Rules of Court. For each unit of work that is done on your file, you receive a credit of around $110. In cases involving a claim less than $100,000 (i.e. fast track lawsuits), you are entitled to a lump sum amount up to $6,500. The longer your case continues, and the more steps taken on the file, the more legal fees are covered by ICBC.
The expectation is that the taxable costs you will receive are only a partial indemnity for the true legal fees that you pay your lawyer.
In terms of the disbursements, those are the expenses your lawyer pays to pursue the ICBC claim. Examples of disbursements include court-filing fees, expenses for medical legal reports, photocopies, faxes, etc. ICBC will usually compensate you for all your reasonable disbursements regardless of whether a lawsuit has been commenced.
Please note that costs and disbursements are not available if you are found at fault for the accident. In fact, ICBC may be entitled to their costs and disbursements from you.
If you are partly responsible for the accident you may only receive a portion of the costs and disbursements based on your level of success. As an example, if you are only 50% successful, you only get 50% of your costs and disbursements.
Another way you may not be entitled to certain costs and disbursements is if ICBC has made a formal Offer to Settle after litigation commences. Then, if your case goes to trial and you receive an award from the Court less than the Offer to Settle, ICBC gets their costs and disbursements after the date of the Offer to Settle and you receive your costs and disbursements before the Offer to Settle date.
The same rule applies if you accept ICBC’s Offer to Settles months after they issued it.
There are many other exceptions to the rules on costs and disbursements that are better discussed with your lawyer, but the above gives you a general idea of costs and disbursements.
ICBC Insurance Breaches
It is an interesting concept where ICBC is supposed to be a universal insurance policy for everyone in the Province of British Columbia yet ICBC is trying to run its insurance department in a way that limits insurance coverage. Invariably, when you run a company as a business with a view to the bottom line, you find ways of avoiding paying out money. You find ways of making others pay you money. Therefore, over the last decade ICBC has greatly increased the frequency of breaching motorists of British Columbia of their contract of insurance and pursuing these motorists personally for repayment of money. The articles below provide some insight into ICBC’s practice.
The number one reason ICBC breaches someone of their contract of insurance is if there is an element of drinking and driving and then a motor vehicle accident. They almost always denied coverage if there is a hint that alcohol may have been a contributing factor in the accident. Indeed, ICBC will often breach you of your contract of insurance despite the fact that the police do not charge you criminally with impaired driving but provide you with an administrative penalty. Equally, ICBC will continue to breach you of your contract of insurance even when you beat the impaired driving charge.
In recent times, the government expanded the use of non-criminal charges (“Roadside Suspension’), as part of their anti-drinking and driving policy. Basically, a Roadside Suspension cannot be disputed unless you ask the police officer to administer a roadside screening device and he refused to do so. In essence, the police officer has become the judge and jury.
Therefore, without any real evidence of state of impairment, you can get a Roadside Suspension from the police. ICBC then turns around and says you are in breach of your contract of insurance because you are impaired by reason of alcohol yet getting a Roadside Suspension is not equivalent to being impaired while driving. Indeed, the cutoff for getting a Roadside Suspension is below the legal limit where experts will testify you are impaired by reason of alcohol. Most experts say that the bloodalcohol level has to be at least .10 (not .05) to impair somebody to the point of causing or contributing to an accident.
The case of Smissen v. ICBC 2004 BCSC deals with the onus on ICBC to prove, on a balance of probabilities, that at the time of the accident the person was under the influence of intoxicating alcohol to such an extent as to be incapable of the proper control of his vehicle.
The breathalyzer test, whether administered on the roadside or at the police station, even when the reading is over the legal limit is not enough to prove that someone is incapable of proper control of his vehicle. In Smissen v. ICBC 2004 BCSC there was a 24-hour Roadside Suspension issued after a failed handheld breathalyzer test, but at trial there was evidence that such a machine had to be calibrated every 2 weeks in order to yield valid results and there were no calibration records. Additionally, the driver in this case had a heart condition that caused blackouts, which was ultimately found to be the reason why he veered into the ditch. There was also a witness who observed the path of the vehicle for 8 miles and didn’t notice any erratic driving.
Despite the above noted law, ICBC simply ignores it. When they find out about the Roadside Suspension, and they will, it is almost guaranteed you will get a breach of your contract of insurance.
One point is if you try to hide the fact of the drinking and driving from ICBC they will turn around and also breach you because of a false statement. At some point, ICBC will receive the police report which will have the indication of impairment charge. Therefore, if asked about the drinking and driving you should fully disclose that fact.
If you do start a lawsuit against ICBC for insurance coverage it will be very difficult for ICBC to prove alcohol consumption caused or contributed to the accident because the evidence necessary for ICBC to win on the point is generally gone. All that is left is a police officer saying he found you to be above the legal alcohol limit for driving but again that doesn’t necessarily establish impairment that caused or contributed to an accident. Of course, if you are well above the legal limit at the time of the accident then ICBC will win the case because the higher your blood-alcohol content the more obvious it is that alcohol consumption influenced the accident. The gray area is where you are in the blood-alcohol range at or below .10.
In summary, despite the fact that the law requires ICBC to prove that alcohol consumption caused or contributed to an accident, ICBC ignores the law and in almost all situations will hold you in breach of your contract of insurance. Therefore, you are at the mercy of the police officer who may be overaggressive in providing an administrative penalty to you. The implication could be far greater than simply having to pay a fine for the impaired driving. You could be without insurance coverage and that could be a financial disaster.
It is a standard process for the ICBC adjuster to consider who was driving the vehicle as compared to who is named as the principal operator on the contract of insurance. If the driver does not have as good a safe driving discount as the owner, ICBC often breaches the owner and driver of the contract of insurance. In doing so, they ignore the explanation of the driver/owner as to use of the vehicle.
Common instances of a breach is where a parent is insuring and owing a vehicle which apparently is being driven by a child. Other common instances are where there is a husband-wife or boyfriend-girlfriend situation and one partner has a much lower discount rate than the other partner. If the good driver is the principal operator for all vehicles in the household than that sends out a red flag to ICBC.
The starting point is when getting interviewed by ICBC, make sure that you are aware of who is the principal operator on the contract of insurance before going into ICBC so that you don’t get tricked into ICBC’s attempt to show that the principal operator is somebody other than the person named on the contract of insurance.
Ultimately, the principal operator that is supposed to be named on the insurance would be that person that is most likely to use the vehicle more than 50% of the time as at the time of placing the insurance. For the limited savings on insurance premiums it is not worth using somebody else as a principal operator when clearly that individual will not be driving the vehicle more than 50% of the time. The end result of doing that is you are basically driving the vehicle without insurance if ICBC finds out about your false declaration and breaches you.
Another example of where ICBC is very aggressive on denying insurance coverage is where they feel the vehicle is not insured correctly. The most common situation is where you are using the vehicle to drive to and from work or for the purposes of work but yet have insured the vehicle for pleasure use. The second most common situation is where you have the vehicle insured in one part of the Province but are driving it in another part of the Province where the insurance premiums are higher. Similarly if you have insured the vehicle in British Columbia and are driving it in another Province or in the United States for an extended period time you may be in breach of your contract of insurance.
The simple point is to make sure when you meet with your insurance broker to buy insurance make sure you properly insure the vehicle. As a cost-benefit analysis, the limited savings in insurance premiums does not offset the severe financial implications of being caught insuring the vehicle improperly.
Similarly, if you have a change in your lifestyle such as moving or requiring your vehicle more for work you should go and get the vehicle reinsured properly. The law says that the situation as at the time of purchasing the insurance is applicable and you don’t have to change your insurance on every change in your lifestyle. However, ICBC ignores that law and if they can find a way of breaching you of the contract of insurance they will do that. For example, they don’t care that you may have not been driving your vehicle to work when you placed the insurance. They rely on the fact you are now driving it to work more than 6 days a month and did not insure the vehicle that way.
Be cautious when you see an adjuster after a motor vehicle accident which is your fault if there may be some issues about the insurance coverage. They are trying to set you up to give evidence which may potentially create a breach. You still have to be honest with them because ICBC has been known to do further investigations and if you are caught given them a false statement that is a reason for a breach of the contract of insurance in itself. For example, if you say you never drive your vehicle to work and they phone a colleague that says you do drive to work, they will breach of your contract of insurance due to the misstatement alone.
In summary, it’s very important to ensure that your vehicle is properly rated for travel to and from work, for business use and for territory of operation. Do not try to save on insurance premiums by misleading the insurance broker as to the use of the vehicle.
The system allows ICBC’s breach ruling to be the “final say” on insurance coverage unless you sue ICBC to force them to provide insurance coverage. ICBC knows that most people will not sue them for coverage and will ignore the situation.
Indeed, the majority of individuals that are breached of their contract of insurance simply do nothing and then the one-year limitation period after the denial passes by making ICBC’s decision final and untouchable.
On occasion, ICBC will offer a relief against forfeiture which means that they will reinstate the insurance if you pay a very significant fine. On first blush, you may think that the fine is excessive because it is usually 10 times the amount of premiums that you saved by insuring your vehicle incorrectly. However, the alternative is to allow the breach of contract of insurance to stand and for you to fight ICBC in Court to reinstate your insurance policy. The expense of running a lawsuit is almost certain to outweigh the fine. In addition, if you allow the breach of the contract of insurance to remain, the debt that ICBC will put on your driver’s license almost always greatly exceeds the fine.
Assuming the breach of the contract of insurance stands, the next thing that happens is ICBC sends a demand letter to the breached insured after the claim has been settled with any third parties. The demand letter could be years later and asks the breached insured to pay back all the money ICBC paid for vehicle damage, personal injuries, etc. If you don’t pay immediately, ICBC will aggressively pursue repayment.
The breached insured also has little chance to dispute the amount ICBC pays out on the claim yet it becomes a debt of the breached insured. In other words, ICBC has no obligation to prove that the money they have allocated against you as your debt on your driver’s license is in fact fair and accurate.
Don’t think for a moment that you can ignore this demand for payment. If you don’t pay, ICBC will likely take away your driver’s license or your insurance and even start collection proceedings against you.
The reason being, the government has given ICBC very powerful collection abilities. ICBC doesn’t have to prove the size of the debt nor sue you for the debt. They can simply eliminate your opportunity to drive in the Province of British Columbia until you pay up. Clearly, this ability to limit your driving in British Columbia is a significant collection power.
If faced with the demand letter, you need to consider overturning the ICBC decision on the breach of insurance. The only way to do so is to fight the matter in Court. The problem though is that you have one year from the denial of the insurance coverage to sue and often the demand for payment that is sent to you is years later.
If there is no hope to avoid the breach of the contract of insurance, you need to find a way to pay this debt or negotiate something with ICBC. In the past, ICBC has been willing to accept partial monthly payments of the debt but in recent times, they have not been as generous because the collection department has a mandate to be very aggressive.
In summary, when ICBC sends you a demand for payment this is a very serious matter. You won’t be able to ignore them because they are very aggressive in their collection methods to the point of taking away your driver’s license and insurance if you don’t pay up.
The starting point is ICBC has complete control as to the decision on insurance coverage. They do not have to consider the testimony of the driver in their decision. They can use a healthy level of skepticism and conjecture to make their decision without any recourse if they make the wrong decision. Once ICBC makes the decision, the decision is final unless you dispute it. That is, you need to take positive steps to suing ICBC in either small claims court or Supreme Court for insurance coverage. You must do so within a year of the denial. If you do not take positive steps, ICBC’s decision is final and any damages flowing out of their decision will be your responsibility.
Depending on the potential exposure, you have to make a decision whether you want to sue ICBC or simply accept their decision.
For example, if it is a single vehicle accident than the loss to the driver/ owner is there is no coverage for the vehicle damage. In that instance, it may not be worth the legal costs and the general hassle of pursuing ICBC for insurance coverage.
However, if the driver caused an accident to another vehicle then ICBC will be looking to the driver/owner to pay back any damages paid to the other vehicle and its occupants, whether it is a vehicle damage claim or an injury claim. In some instances, the claim by ICBC can be very large, often in the hundred thousand dollar plus range. In this type of situation, it may well be worth pursuing ICBC for insurance coverage because the alternative is to pay them back a very large sum of money.
There is no question that when you are faced with the breach situation and you need to hire a lawyer it’s going to be an expensive endeavor. To make matters worse, the full cost of a lawyer is not something you can claim back from ICBC even if you win. Therefore, it’s a matter of a costbenefit analysis as to whether or not you want to involve a lawyer.
If that was not enough, the Government has placed a rule that in Small Claims Court you cannot seek a declaration so ICBC often tries to stymie due process by arguing that the Small Claims Court has no jurisdiction to consider the insurance breach issue because it’s a declaration of insurance. ICBC tries to force the case to be heard in Supreme Court which necessitates the use of a lawyer and the potential risk of having to pay a portion of ICBC’s legal fees and all their expenses if you lose the case.
These breach cases are also very hard fought by ICBC and they seldom back down even if they are flat-out wrong because they know, due to expense of a lawyer, they have the upper hand.
Ultimately, you need to do a cost-benefit analysis when faced with a breach situation. If the loss is not large, you may wish to walk away from the claim for insurance. If the potential personal financial exposure is very high, especially when there is an injury in the other vehicle, ignoring the breach would be a very bad idea.
Where an injured individual is suing you for damages suffered as a result of an accident that is your fault, and ICBC has breached you of your contract of insurance, ICBC will file a Third Party Notice against you. This document will be served on you personally. The Third Party Notice allows ICBC to step into your shoes and defend the lawsuit advance by the injured individual. Just because ICBC has appointed a defense lawyer to work on the file doesn’t mean you are out of hot water. Rather, once ICBC pays out the claim, they will then send you a bill for the entire pay-out to the injured party.
When faced with a Third Party Notice, you should consult a lawyer and decide whether or not you should dispute the Third Party Notice and try to counter sue for insurance coverage.