Can an Insurer Deny Accident Benefits After Two Years in Ontario?

Can an insurer deny accident benefits by arguing your claim is too late?

Yes — an insurer can raise the two-year limitation period as a complete defence to an accident benefits dispute, but only if the claimant truly filed their LAT application after the deadline expired. In Safa v TD General Insurance Company, 2026 CanLII 77481 (ON LAT), the Licence Appeal Tribunal examined exactly this issue in the context of psychological and chronic pain benefit claims.

Understanding how limitation periods work in Ontario accident benefits disputes is essential for anyone whose insurer has denied a claim. A missed deadline can end your case before it begins.

What is the two-year limitation period in Ontario accident benefits cases?

The two-year limitation period means a claimant has two years from the date of an insurer’s denial to file a dispute at the Licence Appeal Tribunal. This rule comes from Ontario’s Insurance Act and the Statutory Accident Benefits Schedule (SABS), which govern how accident benefits are claimed and disputed after a motor vehicle collision.

Importantly, the clock does not start ticking from the date of the accident. It starts when the insurer sends a written denial of the specific benefit in question. This distinction matters enormously for injuries — like psychological conditions or chronic pain — that are often diagnosed or claimed months or even years after the collision itself.

How does the limitation period apply to psychological and chronic pain claims?

Psychological injuries and chronic pain conditions are among the most commonly disputed categories in Ontario accident benefits claims. These conditions frequently develop gradually, meaning a claimant may not seek or receive a formal diagnosis until long after the accident. The insurer may not deny the related benefits until that point.

Because each denial triggers its own two-year window, a claimant who was denied psychological or chronic pain benefits recently may still be well within time — even if the underlying accident happened several years ago. The key question the LAT examines is: when exactly did the insurer communicate the denial for that specific benefit?

What happens if you miss the two-year deadline?

Missing the limitation period is a serious problem. If the LAT finds that a claimant filed their application after the two-year window closed, the dispute will typically be dismissed without any consideration of the medical merits. The claimant loses the right to have their case heard, regardless of how legitimate their injuries may be.

This is why acting quickly after receiving a denial letter is so important. Our Ontario litigation lawyers regularly advise accident benefits claimants on how to preserve their rights and avoid procedural pitfalls like missed limitation deadlines.

Does winning a limitation period argument mean you win your benefits?

No — surviving a limitation period challenge only means the LAT will hear your case on its merits. The claimant still carries the burden of proving entitlement to the disputed benefits through medical evidence, expert reports, and other documentation.

For psychological injuries and chronic pain, that typically means providing clinical records, assessments from treating practitioners, and often independent medical examinations. A successful limitation period argument is the door to the hearing room — not the end of the fight.

Why do insurers raise limitation periods as a defence?

Insurers raise limitation period arguments because they are procedurally efficient. If the argument succeeds, the insurer avoids a full hearing on the medical and factual merits of the claim entirely. It is a threshold defence that, if accepted, resolves the dispute in the insurer’s favour without any assessment of whether the claimant’s injuries are real or serious.

This is a legitimate legal strategy, and claimants should not assume that a limitation period challenge means their insurer believes their injuries are not genuine. It is a procedural argument, not necessarily a medical one.

Practical takeaways for accident benefits claimants

• Track every denial letter carefully. The two-year limitation period begins when the insurer formally denies a specific benefit in writing — keep all correspondence with your insurer organized and dated.
• Do not wait to seek legal advice. If you receive a denial for psychological or chronic pain benefits, consult a lawyer promptly. The two-year window can close faster than you expect, especially if you are managing health challenges.
• Each benefit has its own deadline. A denial for one type of benefit (e.g., income replacement) does not start the clock for a different benefit (e.g., psychological treatment). Understand which benefits have been denied and when.
• File your LAT application before the deadline, even if negotiations are ongoing. Informal discussions with your insurer do not pause the limitation period. Filing protects your rights while discussions continue.
• Medical documentation matters from the start. Even if you are focused on the timing issue, begin gathering clinical records and assessments for your psychological or chronic pain condition as early as possible — you will need them if the case proceeds to a merits hearing.

If you are dealing with an accident benefits dispute in the Hamilton or Burlington area, our Burlington litigation team and Hamilton litigation team are familiar with LAT proceedings and can help you understand your options.

UL Lawyers offers a free initial consultation from our Burlington office and serves clients across Ontario. If your insurer has denied your accident benefits claim, reach out to our accident benefits and civil litigation team to discuss your situation before any deadlines pass.

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This article is automated commentary on a public court decision and is for general information only — not legal advice. Decisions rely on facts unique to each case. If you are affected by a similar issue, contact a lawyer for advice specific to your situation.