RBC Insurance predicts long term disability incidences to rise in 2018

Long Term Disability Forecast can help businesses manage costs related to claims

TORONTOJan. 30, 2018 /CNW/ – RBC Insurance predicts Long Term Disability (LTD) incidence rates will be 4.7 per cent higher compared to 2017 driven by a strengthening Canadian economy. Using a proprietary algorithm, RBC Insurance has discovered that new LTD claims are linked to GDP growth rates. Understanding the correlation between GDP and LTD claims can help businesses manage costs related to claims, ensure adequate staffing during critical seasons, and help employees get support when they need it the most.

“Using the RBC Insurance Group LTD Forecast, we predict LTD incidence rates will continue their recent rise and increase by 4.7 per cent in 2018 relative to 2017, which will impact both employers and employees alike,” says John Carinci, Vice-President and Head, Operations and Client Experience, RBC Insurance. “Businesses in Canada spent $7.5 billion for LTD coverage in 2016, which is the third largest cost to a group benefits plan after health and dental. Knowing that LTD rates are expected to rise is important information that businesses can use to help manage those costs, support their employees and ensure their operations continue to run smoothly.”

How the RBC Insurance Group LTD forecast works
Based on research conducted by RBC Insurance, as GDP accelerates and the economy grows, there is a corresponding increase in the incidence of LTD claims. Conversely, when the rate of GDP drops, so does the incidence of LTD claims. At the start of 2017, the model successfully predicted an increase in incidence for the year (relative to 2016) that was fairly close to the actual rate experienced. It is believed that during challenging or uncertain times, workers can be concerned about job security and performance, creating significant mental and/or physiological stress. As the economic outlook brightens and GDP rises, workers may begin to feel more secure and the pent up stress and anxiety can take its toll, making them more likely to succumb to illness and taking a leave from work to recoup.

“With the anticipated rise in LTD claims, businesses should proactively create awareness of the support available to employees and create contingency plans to ensure adequate staffing,” says Julie Gaudry, Senior Director, Group Insurance, RBC Insurance. “While employees must deal with the significant emotional and financial stress of being off work, business owners can be particularly hard-hit as they lose employees during times of strong economic activity.”

RBC Insurance offers the following tips to help businesses manage LTD claims:

  • Create additional focus on Employee Assistance Programs (EAP) to support employees as GDP rises – programs such as EAP can help employees manage certain conditions and work-life issues before spiraling to the point of disability
  • Create contingency plans to ensure adequate staffing levels during times of positive economic growth including a buffer for potential claims
  • Look for flexible Group Benefit plans that have options such as allowing employees to return to work on a part-time basis while still receiving benefits
  • Ensure employees understand the coverage in their plan and make use of any ‘Return to Work Benefits’ such as financial planning, rehabilitation and other services to help make a smooth transition back into the workplace

About RBC Insurance
RBC Insurance® offers a wide range of life, health, home, auto, travel, wealth and reinsurance advice and solutions, as well as creditor and business insurance services to individual, business and group clients. RBC Insurance is the brand name for the insurance operating entities of Royal Bank of Canada, one of North America’s leading diversified financial services companies. RBC Insurance is among the largest Canadian bank-owned insurance organizations, with approximately 2,500 employees who serve more than four million clients globally. For more information, please visit rbcinsurance.com.


ICBC posts $935M in net losses in first nine months of fiscal year

VANCOUVER _ The financial crisis at British Columbia’s public auto insurer is deepening, as $1.3 billion in net losses are now projected by the end of the current fiscal year.

The Insurance Corporation of B.C. said the “sizable and significant loss” is evidence of the growing financial pressures from a rapid increase in the number of collisions in the province, as well as the rising costs of those claims.

“The number of crashes occurring across B.C. is continuing to escalate year-after-year. As a result, the number of claims we are receiving is growing by thousands each year,” the corporation said in a news release on Sunday.

The cost of injury claims is closing in on $3 billion annually, ICBC said.

The number of large loss claims, with an average payout of $450,000, has also spiked by 80 per cent in the last 12 months.

The spike in the number of claims is also causing a slow-down in how quickly settlements are delivered.

“This has particularly been the case with represented claims, which are taking even longer to settle. The longer a claim takes to settle, the more expensive it becomes,” ICBC said.

ICBC said $935 million in net losses have already accumulated between April 1 and Dec. 31 last year, signalling that premiums are not covering payouts.

The insurance provider asked the provincial utilities commission to hike basic and optional rates last fall to combat its financial crisis.

Attorney General David Eby said in September that the rate hikes would mean the average driver can expect an annual increase of eight per cent or $130 per year on their insurance bill.

Eby has previously said the Crown corporation’s financial problems are the fault of the former Liberal government for failing to address issues years ago.

But Liberal caucus executive director Shane Mills said the previous government implemented strong measures to control costs, including a distracted driving campaign, raising premiums for some high-level vehicles and reducing executive pay.

“As well, a third-party review was conducted on how to tie any rate increases to inflation, and is in the hands of the new government,” Mills said in a statement.

Eby is expected to deliver his response to the latest losses Monday in Vancouver.

Finance Minister Carole James was not available for comment Sunday on how the loss will affect the upcoming provincial budget.

Security Guard Run Over By Fleeing Thief Found Not Contributorily Negligent

Reasons for judgement were published this week by the BC Supreme Court, New Westminster Registry, assessing fault for a crash involving an unidentified motorist.

In the recent case (MacKenzie v. John Doe) the Plaintiff was working as a security guard when he noticed a shoplifter.  He pursued the shoplifter to his vehicle.  When confronted the shoplifter ran the plaintiff over and injured him.  The collision was described as follows:

[17]        The plaintiff described what happened.  When the individual was further along the sidewalk, the plaintiff observed him getting into the driver side of a parked vehicle.  The plaintiff approached the vehicle’s passenger side and opened the door, saying “store security”.  He asked for the merchandise back.  The individual responded, “fuck you”, and then put the key in the ignition, started the ignition, and immediately started reversing the vehicle into the parking lot.  

[18]        At that time, the door of the vehicle hit the plaintiff in the chest, causing him to lose his balance.  His feet slid under the passenger-side door.  The plaintiff hung onto the passenger-side door as the individual reversed his vehicle out of the parking spot.  He asked the individual to stop the vehicle but the individual did not do so and then the plaintiff let go.  When he let go, the passenger-side door hit him.  As a consequence, he lost his footing, fell and struck the back of his head on the concrete, at which point he believed his legs went under the vehicle.  The individual continued driving in reverse gear all the way up a ramp where he then spun around and drove away at quick speed, quicker than the speed one would normally go when reversing a vehicle, the plaintiff testified.

[19]        The plaintiff attempted to get up.  However, a bystander said “I am not sure if you realize what just happened to you.  You should probably stay down”.  So he did.  First aid arrived shortly after and then the paramedics.

The shoplifter remained unidentified and the Plaintiff applied for statutory compensation from ICBC for the hit and run collision.

ICBC argued that the Plaintiff was partly at fault for the incident.  The Court disagreed and in finding the Plaintiff acted reasonably in pursuing the thief Madam Justice Maisonville provided the following reasons:

[88]        I find that, in this case, the vehicle had not been started when the plaintiff approached it.  I find that the car key was not in the ignition when the plaintiff opened the vehicle’s passenger-side door and, as such, the plaintiff could not reasonably anticipate carelessness or even the events as they transpired, which involved flagrant and deliberately reckless conduct…

[93]        Consequently, where the defendant’s negligence rises to a level of flagrant and deliberate recklessness, the plaintiff cannot be found to be contributorily negligent, as reprehensible behaviour from a defendant is not reasonably foreseeable. 

[94]        Another aspect of the case before me negating contributory negligence is the fact that the plaintiff was not in violation of his company’s policy, and I cite Lewis v. Todd, [1980] 2 S.C.R. 694 in support.  In Lewis, it was dark out, and an officer wearing a dark uniform was struck by a car and killed while on duty.  The trial judge found no contributory negligence.  On appeal, the Ontario Court of Appeal found the officer to be 25% negligent.  However, on further appeal to the Supreme Court of Canada, that decision was reversed.  At page 700, the Court stated:

The Court of Appeal found that Constable Lewis should not have continued unassisted with his investigation on the road. To do so was negligent. The evidence was, however, that Constable Lewis did not depart from police practice. The trial judge did not misapprehend the evidence, or ignore evidence which would have suggested that police standards required more than one officer at an accident. There was no evidence, then, to support the conclusion that Constable Lewis needed assistance and that he was negligent in not asking for it. …

[95]        Given that there were circumstances which should have alerted other drivers to the presence of police officers on the highway, the court in Lewis held that there was no negligence on the part of the officer, including on the basis that he failed to keep a proper lookout.  

[96]        Here, in like circumstances, the defendant was well aware of the presence of the plaintiff, who asked him to stop, yet chose to ignore him and instead respond with a terse, profane answer and reverse the vehicle.  I find that the plaintiff could not have reasonably foreseen what occurred, that the defendant was flagrant and deliberately reckless, and that the plaintiff is in no way contributorily negligent for the accident which occurred.

Electronic Pink Slips (Proof of Responsibility) Now Available

Cornerstone Insurance Brokers Ltd. is pleased to announce that we now offer our customers access to an electronic pink slip on their smartphone directly from the secure MyCornerstone portal.

This first in the industry portal provides customers unlimited 24/7 access to their policy information and pink slips directly from any smartphone, tablet or desktop without the need to download an application. The interface is fully mobile, providing an excellent view of the secure pink slip with up to the minute information. It is far more secure than keeping a piece of paper in your glove box and you can choose to make it accessible to every driver on the policy by simply by providing them the access to MyCornerstone with the secure user ID and password.

While the current regulation does not provide for the electronic distribution of a pink slip, Cornerstone believes that Ontario will allow this methodology shortly. Cornerstone has made the investment because it compliments their already innovative and constantly evolving customer service platform in their quest to deliver an exceptional customer experience. The portal also provides;

  • The ability to request policy changes and report claims online;
  • Access to an inventory tool that allows customers to download photos of their house and contents to our secure server;
  • An educational area with videos designed around frequently asked questions on insurance terms. We believe that our role is that of an insurance advisor, helping our customers make informed decisions that best suit their needs;
  • Tips on how to care for your car and home as well as frequently asked questions about insurance, and;
  • shopping hub that allows Personal Lines customers to get discounts from our Commercial Lines customers – providing a win/win for everyone involved.

Want to access your electronic pink slip? Sign up for MyCornerstone today!

Cornerstone Insurance Brokers is a full line insurance brokerage with offices in Woodbridge (Vaughan), Aurora, Markham, and Barrie. Cornerstone provides car insurance, home insurance, motorcycle insurance, farm insurance, equine insurance, rural insurance, business insurance, life insurance, disability insurance, critical illness insurance and health insurance, as well as employee group benefits all over Ontario.

Rain gutters cause many home drainage problems

By Dean Fosdick


The person who coined the phrase “saving for a rainy day” must have been a property owner with home drainage problems.

The financial costs of poor drainage can be substantial, and the human health costs significant too.

Prevention is important, and many clues exist for predicting trouble, says Ryan Larsen, a civil engineer with NDS Inc., a manufacturer of drainage products in Woodland Hills, California.

“Low spots in the landscape can be hard to see, but areas where the ground is wet for long periods of time after it rains or the sprinklers run are locations where water is collecting,” Larsen said.

Discoloration and mould growth on a home’s foundation, and places where stucco, siding or paint easily fall off a house are indications that water is pooling, he said. “You should suspect water is getting into your home if you detect damp or musty smells in your basement or crawl space,” he said.

Most homes have some kind of drainage problem, and most often the damage comes from rain gutters, Larsen said.

“Because a lot of homes have gutter downspouts that lead straight to the ground, you’ve got all this water coming off the roof and pouring to just one point, where it can collect against a home’s foundation and flood landscapes and planter areas,” he said. “Fortunately, gutter problems are also the easiest to fix with a downspout extender.”

The financial costs of poor drainage can add up. Outlays for drying basements can range from $1,000 to $10,000, according the U.S. National Flood Insurance Program. Repairing foundation damage can cost anywhere from $3,500 to $25,000, the National Association of Realtors says.

The human health costs of poor drainage on properties also can be sizeable, Larsen said. “Poorly drained runoff from roofs can enter basements or flow inside homes through foundational cracks or leaks where it can warp floorboards and turn finished rooms into mildewy and mouldy messes that can attract insects and rodents.”

Inadequate drainage also cracks foundations, creates standing water that ruins yards and gardens, and allows breeding spots for disease-carrying mosquitoes and heartworms.

“Soggy, poorly graded ground spells certain doom for lawns, shrubs, plants and gardens,” Larsen said.

Three of the most common solutions for drainage problems are catch basins, pop-up emitters and French drains.

Catch basins trap sediment and contaminants beneath downspouts for drainage to safer locations. Pop-up emitters are connected to underground drainage pipes and channeled away from structures. The pop-up tops allow water to drain when full but remain closed when empty to keep out rodents and debris. French drains are gravel-filled trenches that direct storm water away from specific areas. They collect water over their entire length, rather than from one particular spot.

With water drainage problems, though, come opportunities, said Monica Day, a water resources educator with Michigan State University Extension.

“Be creative,” Day said. “There are positive ways of dealing with too much water. Keep it in the soil but where it’s not damaging anything. Let (ornamental) plants grow there to filter out the water and retain it.

“That provides beautification as well as practicality,” she said.

Water damage: covered or not?

Rivers that burst their banks – not unheard of in January – water main breaks, sewer back-up, torrential rains that seep through roofs and windows, an overflowing bathtub … water damage can be a real headache. Insurance Bureau of Canada (IBC) has therefore developed a new interactive tool to help consumers see things more clearly.

Accessible to all on the Infoinsurance.ca web site, this online animation tool features a home beset by all kinds of water damage.  Web browsers can test their knowledge of insurance coverage, compare their results and even share them on social media.

Whether caused by climate change, outdated infrastructure, poor building maintenance or domestic accidents, water damage has been a real scourge over the past 10 years or so. In fact, water damage accounts for 50% of the total cost of claims paid out by insurers in Quebec each year, and the trend is rising.

“Consumers can use this new tool to better understand what is and isn’t covered, and they can find out what coverage is available on the market. We hope that in doing so they’ll be encouraged to take steps to better protect their homes and avoid the inconveniences caused by water damage”, noted Line Crevier, Supervisor, Technical Affairs and Insurance Information Centre, at IBC.

While some damage may be inevitable, IBC reminds consumers they can help reduce claims, thanks to a few prevention measures. For example, making sure to change their water heater every 10 years; checking and replacing washing machine and dishwasher hoses; not leaving the house while the washing machine and dishwasher are on; asking a friend or neighbour to check that everything is OK if they’re away from home for more than 7 days (especially in winter); leaving the heat on in the winter; removing snow and ice from windows and eaves troughs, etc.  

What about vehicles?
When it comes to vehicles, for example, water damage is covered under an auto insurance policy, provided policyholders chose “Coverage against perils other than collision or upset” or “All Perils” coverage.

For more information about insurance, IBC’s Insurance Information Centre is there to help. Just call 1 877 288-4321 (or 514 288-4321 in the Montreal area).

About Insurance Bureau of Canada
Insurance Bureau of Canada, which groups the majority of Canada’s P&C insurers, offers various services to consumers in order to inform and assist them when purchasing car or home insurance, or making a claim.

SOURCE Insurance Bureau of Canada

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