BC and Ontario are cracking down on auto insurance fraud — but at what cost?

The legal and insurance worlds are abuzz with a recent decision of the BC Supreme Court. In the decision Arsenovski v. Bodin, 2016 BCSC 359, an adjuster with BC’s provincial auto insurer (ICBC) wrongfully accused a new immigrant — who had limited English skills and no real understanding of the auto insurance system — of making fraudulent insurance claims. The investigation very nearly resulted in a criminal trial for Danica Arsenovski, who was in her early fifties and had recently fled Yugoslavia with her husband.

The judge found that ICBC’s investigation approached Mrs. Arsenovski with a presumption of guilt and had harsh words for the bodily injury adjuster (Gregory Bodin) and Special Investigator (John Gould) involved, saying that the malicious prosecution and “wasting of such public resources to so vindictively pursue Mrs. Arsenovski is deserving of the highest level of condemnation.” The judge awarded Mrs. Arsenovski her legal costs plus $30,000 for emotional distress and $350,000 in punitive damages against ICBC and the special investigator.

Vancouver lawyer Paul Hergott notes that:

The timing of this court decision is incredibly ironic, coming as it does in the midst of an expensive ICBC advertising campaign that makes bold allegations of fraud in personal injury claims without, I should add, providing any evidence to support those allegations. Is the purpose of the advertising campaign to fight fraud or, like the purposes of Mr. Bodin and Mr. Gould, is it another ICBC tactic to achieve the improper purpose of discouraging legitimate personal injury claims?”

Closer to home, a post on the Ontario Trial Lawyers Association blog remarks:

“The Arsenovski decision is timely against a backdrop of the Ontario Provincial Government announcing plans to establish a “serious fraud office” with a special focus on auto insurance fraud”
and that “While insurance fraud is clearly unacceptable, the Arsenovski decision shows that the insurance companies’ zeal to find fraud, at times, comes at the expense of the well-intentioned victims of car accidents.