By Baldeep Virk
Short answer: No. Under Ontario law, a possible future CAT designation cannot be deducted from a damages award under s. 267.8 of the Insurance Act unless the defendant can prove entitlement “beyond dispute”.
I recently settled a case where the defendant vigorously argued they were entitled to deduct future benefits up to the $1,000,000 cap available for car accident victims that meet the catastrophic (CAT) designation when my client had not pursued a catastrophic impairment application as her doctor indicated it was unlikely she would meet the onerous criteria. I was successful in avoiding any such deduction from my client’s settlement and thought I would provide an outline of the law on this subject so other plaintiff lawyers remember to push back and insist the defendants meet their onus.
What is s. 267.8 of the Insurance Act?
Section 267.8 prevents “double recovery.” It allows a defendant to deduct certain accident benefits (SABS) an injured plaintiff has received — or is clearly entitled to receive — from a tort damages award.
It is not an automatic discount tool for defendants. It exists to stop an injured person from being paid twice for the same loss.
What is the legal test for deducting a future benefit?
The Ontario Court of Appeal has been clear for decades: the defendant must prove, beyond dispute, that:
- The future benefit is available; and
- The plaintiff is clearly entitled to it — free of substantive or procedural contingencies.
Key authorities:
- Brown v. Bouwkamp (1975) — “entitled” means a clear, unqualified right.
- Bannon v. McNeely and Chrappa v. Ohm — reaffirmed the “beyond dispute” standard under s. 267 (now s. 267.8).
- El-Khodr v. Lackie, 2017 ONCA — confirmed this test still governs today.
Why doesn’t a possible future CAT designation qualify?
Because it is inherently uncertain. A CAT determination depends on:
- Future medical assessments;
- Evolving medical status;
- Statutory criteria under the SABS; and
- Applications and disputes that have not yet occurred.
That is the textbook definition of a contingent benefit — the exact category Ontario courts have refused to deduct.
What have Ontario courts actually said about future CAT deductions?
- Moore v. Haw, [1997] O.J. No. 3825 — future benefits are not deductible where entitlement is subject to substantive or procedural conditions.
- Gilbert v. South, 2015 ONCA 712 — Court of Appeal upheld refusal to deduct where the plaintiff had no CAT determination; deducting would risk under-compensation.
- Sutherland v. Singh, 2011 ONCA 389 — plaintiffs cannot be penalized for not receiving benefits they never obtained. That would create a windfall for defendants.
- Moore v. Cote — refused a future CAT deduction as “uncertain, not beyond dispute, and not fixed beyond doubt in every respect.”
- Loftus v. Robertson, 2008 — reinforced that the Insurance Act is a consumer-protection statute for the injured, not a reimbursement pool for tortfeasors.
What does this mean for injured plaintiffs?
Three points to take away:
- The burden is on the insurer — not on you — to prove any future benefit is deductible.
- “Likely” or “possible” is not enough. The standard is beyond dispute.
- Under-compensation is not the answer. Courts have consistently refused to shift the risk of a speculative benefit onto the injured party.
The bottom line
Unless a defence insurer can prove — beyond dispute — that a CAT determination will be granted and enhanced benefits will be paid, any deduction from your damages under s. 267.8 based on a future CAT possibility should not be permitted.
Injured in an Ontario collision and facing pushback on your damages claim? Our personal injury team knows how the tort and SABS systems interact — and how to defeat improper deduction arguments. Contact us for a free consultation.
This article is general information, not legal advice. Every case turns on its own facts.