by Grace Xu
In Raza v. XL Specialty Insurance Company (2025 CanLII 35957), the Licence Appeal Tribunal (LAT) provided important guidance on the interpretation of section 61 of the Statutory Accident Benefits Schedule (SABS), namely (1) the definition of “any other workers’ compensation law or plan” under section 61(1) of the SABS; and (2) the scope of section 61(2). Adjudicator Ulana Pahuta found that the NAL Insurance policy satisfied the alternative coverage requirements under section 61(1) of the SABS and did not fall within the narrow exceptions contemplated in section 61(2) of the SABS.
The case involved an applicant who was injured in a workplace-related motor vehicle accident – he was injured when the company truck being driven by his co-driver rear-ended another transport truck. His employment contract specified that any benefits related to workplace injuries had to be claimed exclusively through NAL Insurance. After receiving over $71,000 in benefits from NAL, he applied for additional accident benefits under SABS from XL Specialty Insurance. The LAT ultimately barred this claim, finding that the NAL policy constituted an alternative workers’ compensation plan under section 61(1).
Adjudicator Pahuta’s analysis clarified that employment contracts and insurance policies do not need to contain explicit “workers’ compensation plan” wording to constitute an alternative to coverage under the Workplace Safety and Insurance Act (WSIA). The contractual language in this case clearly restricted workplace injury claims to NAL Insurance, prohibiting any additional claims against the employer. However, the adjudicator also found that the nature of the benefits provided (including income replacement, medical expenses, and assessment fees) sufficiently demonstrated that the NAL policy functioned as a workers’ compensation plan. The tribunal also considered evidence showing that NAL marketed itself as a WSIB alternative provider, further reinforcing the adjudicator’s conclusion.
The decision also established important limitations on the section 61(2) exception. The applicant’s tort claim against the driver (his co-worker) and his employer was deemed irrelevant because he was never covered by WSIA and had not made an election under section 30 of the WSIA. This confirms that the section 61(2) exception applies only to workers covered by WSIA who make the proper statutory election. For insurers, this means they can push back against section 61(2) arguments when claimants receive benefits through alternative compensation plans like NAL.
A critical lesson from this case is the evidentiary importance of employment contracts in section 61 disputes. Here, the insurer’s success relied on producing the contract that clearly designated NAL as the exclusive benefits provider. When the applicant alleged the document had been altered but failed to produce his own copy, the tribunal accepted the insurer’s version.
Ultimately, Raza reinforces that SABS benefits may not be available as secondary coverage when another valid compensation plan exists. The decision provides insurers with clear guidance for identifying alternative workers’ compensation arrangements and properly applying section 61’s limitations.
For insurers handling similar claims, Raza offers a valuable framework for analyzing section 61 issues. The decision confirms that private insurance arrangements can qualify as workers’ compensation plans when they provide comparable benefits and contain exclusive remedy provisions. It also establishes important boundaries around the section 61(2) exception, helping insurers properly assess when it may or may not apply. These clarifications will prove particularly useful when dealing with non-traditional employment relationships and alternative benefit structures so that insurers can prevent improper dual recovery attempts.
Grace Xu is a summer student at the firm and the author of this blog. If you have a question about this decision or a similar file, please contact Grace at [email protected] or Peter at [email protected]
