In Parmar v. Teachers Life, Justice Faieta held that the limitation period in Teachers Life’s “Educators Income Protection Plan and Policy” doesn’t apply to a claim for denial of coverage under the policy. Instead, the Limitation Act‘s basic two-year limitation applies:
[32] The defendant submits that this action is barred by the two-year limitation period found in Policy. The relevant provision, at p. 50 of the Policy, states:
In the case where benefits have not been paid or have been paid on a without prejudice basis, a legal proceeding shall not be commenced in respect to a claim under this policy after the second anniversary of the day the claim was discovered. Discovery of a claim shall be defined as the earlier of the date a claim was first filed with Teachers Life, or the day a reasonable person ought to have known that a claim for benefits should have been filed with Teachers Life. [Emphasis added.]
[33] However, the Act provides that a limitation period under the Act applies despite any agreement to vary or exclude it unless (1) such agreement was made before January 1, 2004; or (2) it is a “business agreement”, among other exceptions: see s. 22 of the Act. I find that neither exception applies.
[34] First, the Policy states that it was revised September 1, 2009 and “replaces all previous polices issued for Plan holders who are not currently receiving Disability Benefits”: see Policy, at p. 2. Accordingly, I find that the Policy was not made before January 1, 2004.
[35] Second, the Policy names (1) the defendant as the insurer; (2) the Ontario Secondary School Teachers’ Federation, District 12, as the Plan Sponsor; and (3) the individual member as the Policyholder. I find that the Policy is not a “business agreement” because (1) the plaintiff is a party to the Policy; and (2) the Policy was made for “personal, family or household purposes”: see Kassburg v. Sun Life Assurance Company of Canada, 2014 ONCA 922 (CanLII), at paras. 58-61. Accordingly, the limitation period provision found in the Policy, including the trigger for the discovery of a claim, has no effect.