Proposed class actions allege Ontario insurers broke payment rules

A series of proposed class action lawsuits have been launched against some of Ontario’s largest insurance companies, alleging they are breaking rules that govern payments to automobile accident victims.

Lawyers representing the accident victims allege the companies are not paying HST on accident benefits and are decreasing the funds
available to victims over the long-term as a result. 

The lawsuits seek a combined $600 million in compensation and an injunction to prevent further alleged breaking of the rules around
payments of the HST, which is a combination of the federal goods and services tax and the regional sales tax.

The legal action also names Ontario’s insurance regulator – the Financial Services Commission of Ontario – alleging that it has known about the practice for years but has failed to stop it.

The lawyers allege the Aviva, Intact, Belair, Allstate, Unifund and Certas insurance companies have broken the rules.

None of the allegations have been proven in court. Certas, Unifund and Aviva say they can’t comment on the legal action as it is before the courts while the three other companies did not immediate respond to requests for comment.