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Disability Insurance

What can you do about bad-faith conduct by a disability insurer?

Insurers owe policyholders a duty of good faith in claims handling. Where conduct goes beyond a wrong decision into unfair handling — unexplained delay, shifting reasons, ignoring treating physicians, or repeated identical document requests — a court can award damages beyond the benefits owed, and Canadian courts have done so in disability cases.

What to do next

  1. Document the handling, not just the decision

    Keep a dated log of every call, request, delay and stated reason. Bad-faith claims are built on the pattern of conduct, which only exists if you recorded it.

  2. Put concerns in writing

    Written complaints create the record and trigger the insurer's own complaint-handling obligations. Escalate to the applicable ombudservice or regulator, which costs nothing.

  3. Get legal advice on both claims

    The claim for benefits and the claim for bad-faith damages are related but distinct. Counsel can advise whether the conduct meets the threshold and how it affects strategy.

Frequently asked questions

What counts as bad faith?

Not merely a wrong decision. Unexplained delay, shifting or pretextual reasons, ignoring treating physicians, and repeated identical requests are the kinds of conduct courts have criticised.

What extra damages are available?

Canadian courts have awarded aggravated and punitive damages in disability cases where handling was egregious. Amounts vary enormously and depend on the conduct.

Is complaining to a regulator free?

Yes. Internal complaint processes and independent ombudservices cost nothing and create a documentary record.

This is general information, not legal advice. Laws vary by location and every situation is different — speak with a qualified lawyer about your specific circumstances.

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By submitting, you agree to be contacted about your inquiry. This is not legal advice and does not create a lawyer–client relationship.

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Guides, Forums & Where This Is Decided

Background reading and the bodies that hear disability insurance matters.

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Where this is decided

All courts & tribunals