Whenever accidents happen in the workplace and there are disagreements on the claim or other factors, insurance dispute lawyers come into the picture. Their goal is to provide various methods of resolving insurance claim disputes.
What do Canadian insurance dispute lawyers do?
Insurance dispute lawyers ensure that their clients are properly represented in an insurance claim. A Canadian insurance law firm or insurance dispute lawyer may represent these parties in a claim under an insurance contract:
- insurers: the insurance company that offered and agreed to compensate the insured party, for any loss, damage, or any other liability according to the accident or contingency specified in the insurance contract
- insureds: the individual or the business that bought or paid for the insurance contract, who will be compensated in case of a loss, damage, or any other liability indicated in the insurance contract
- reinsurers: an insurance company that provides insurance to another insurance company
- excess insurers: a business or company that covers the insurance claim through an excess policy or a secondary policy after the main insurer’s limit has been reached
- intermediaries: those who may be considered either as insurance agents or insurance brokers, who provide services for any of the parties to an insurance contract
Insurance dispute lawyers may also offer services for Special Risks Underwriters, an entity that assumes the insurer's risks and insurance mutuals. An insurance mutual is an insurance company run by the insured persons.
Disputes may arise out of the financial amount of an insurance claim or the extent of the liability of any of the parties. Some of the common insurance disputes stem from the breach of the insurance policy or contract after a claim for indemnity has been filed –
- from the perspective of the insured, an insurance dispute is the denial of its claim that is contrary to the stipulation of their insurance policy or contract, or when it has been arbitrarily or unjustly denied without any compelling reason;
- meanwhile, from the perspective of the insurer, an insurance dispute arises when a claim is tainted by fraud, or when certain conditions stated in the insurance policy or contract have not been met or have been violated, which justifies the denial of the insured’s claim.
Another cause of an insurance dispute is what the industry calls “insurance bad faith”:
Insured persons and businesses are encouraged to consult a lawyer in your area. If you live in Ottawa, for example, contact a Lexpert top-ranked insurance dispute lawyer in Ontario.
How are insurance claim disputes resolved in Canada?
When disputes or irreconcilable issues arise out of the claims under an insurance contract, there are two main processes that parties may resort to: alternative dispute resolution or litigation.
Alternative Dispute Resolution (ADR)
Alternative dispute resolution (ADR) offers many ways where the parties in an insurance dispute may resolve their differences without going to court. An insurance dispute lawyer can advise on the procedure and approach to take, depending on the facts and the issue under dispute.
These ADR methods are based on the idea that a cause of action may be resolved by the parties themselves through a process that is faster and cheaper than court litigation. Whenever possible, insurance dispute lawyers will resort to the use of ADR if this is better for their client.
Negotiation
Negotiation is the initial stage in a dispute resolution where the parties themselves try to come up with a solution without any third-party intervention. Here, an insurance dispute lawyer may assist their client or may represent them during the actual negotiation.
Mediation
Mediation works similarly to negotiation, where the parties themselves arrive at a solution. The difference between the two lies in the participation of an independent third party. A mediator is assigned by the parties to facilitate the process of coming up with an amicable solution through a settlement or an agreement.
Insurance dispute lawyers may also assist clients in the mediation process, but it is not required.
An experienced insurance dispute lawyer may also act as a mediator. They must not be related to any of the parties in the dispute.
Arbitration
In arbitration, an arbitrator or a panel of arbitrators will hear and decide the dispute by rendering an arbitral award. It’s also like a court proceeding, where parties can present their claims through pieces of evidence. The arbitrator or the panel would have “judge-like” powers to resolve the issue.
Litigation
When any of the ADR methods fail, or when it is deemed appropriate, an insurance dispute lawyer may suggest going into litigation. Insurance dispute lawyers can guide clients – insurers or insured alike – towards reaching a favorable decision.
Who holds insurance companies accountable in Canada?
Canadian federal laws and provincial or territorial laws oversee insurance companies in Canada.
When incorporated federally through the Insurance Companies Act, an insurance company will be governed by the Office of the Superintendent of Financial Institutions (OSFI). Otherwise, an insurance company will be governed by the provincial and territorial laws on financial institutions through the respective provincial or territorial regulating authorities on financial institutions or financial services.
The Financial Consumer Agency of Canada (FCAC) also administers the Insurance Companies Act’s provisions on consumer protection. This is imposed on financial institutions which insurance companies must also adhere to.
Have any problematic insurance claims as an insured or as an insurer? Know more about the different resolution processes by consulting one of Lexpert's top-ranked insurance dispute lawyers in Canada.