So you have been in a car accident and have been fighting with your insurance company for some time to get them to approve the treatment and benefits that you need. You finally are able to come to some sort of agreement with them to have them pay you a lump sum in exchange for closing your accident benefits file for good. You sign their papers and the ink has dried. You send in the final release documents to the insurance company. After all that has been done, you begin to have ‘buyer’s remorse’. You start to doubt whether you got a good deal or not. Is all hope lost now? Not necessarily.
Section 9.1(4) of O. Reg 664: Automobile Insurance under the Insurance Act, states, The insured person may rescind the settlement within two business days after the later of the day the insured person signs the disclosure notice and the day the insured person signs the release.
This section essentially means that you would have two business days (not including weekends or holidays) to rescind the agreement and this clock does not start running until the Settlement Disclosure Notice and the Full and Final Release are both signed and returned to the insurance company, and only begins to run on the later of those two events.
This presumably then means that, if you agreed to a settlement orally, but did not yet sign the settlement documents, you should be good to rescind the agreement without issue.
But what about if you already received money from the insurance company after you signed all the documents but before the end of the two business days?
In the Ontario Court of Appeal case of Stephan v. Insurance Corporation of British Columbia, (2000 CanLII 3798 (ON CA)), the Court held at paragraph 21, There are, in short, four legal consequences which immediately flow from the delivery of the written notice under s. 9.1(4):
- the settlement is rescinded;
- the release incorporating the settlement is voided;
- any settlement moneys paid to the insured become due and owing; and
- the insured has the right to pursue a claim for statutory accident benefits.
While it is unlikely that the insurer would have paid the insured the funds as per the settlement within 2 days, if that has occurred, the money paid by the insurer to the insured becomes owing back to the insurer after the insured rescinds the settlement agreement.
After rescinding the settlement agreement, the insured person then has restored his or her right to continue with the accident benefits dispute, and/or to continue making claims for additional benefits.
To consult with a lawyer who has experience dealing with accident benefits settlements with insurance companies, please contact our team at JEWELL RADIMISIS JORGE LLP for a free initial consultation at 1 (855) 546-2525.