October 20, 2016, Kitchener, Ontario
Posted by: Robert Deutschmann, Personal Injury Lawyer
Effective June 1, 2016, coverage under Ontario auto insurance policies was reduced significantly in the event of personal injury. Simply put, if you are injured in a car accident you may not have enough benefits to see you through recovery now. The changes were in response to decreases in premiums required by the provincial government to help make them more affordable.
The most significant changes include serious reductions of accident benefits. While the new benefit amounts seem to be large at first glance, anyone who has been unfortunate enough to be in a car accident will tell you that the amounts of coverage may well be inadequate. Consider if you are injured seriously and you need physio, OT, and personal care 3 times a week for a few months at $1000 a week then onward for many more months. Consider the cost of assistive devices (canes, beds, wheelchairs etc), the cost of medications, and the cost of the many other therapies and medical assessments that may be required. Many costs of an accident extend over a lifetime as well. If you have serious injuries, you may require assistance/physio for the rest of your life.
The Financial Services Commission of Ontario which overseas auto insurance in Ontario released a fact sheet regarding the changes. I’ve cut and pasted the important parts here. You can check out the website for all the details. Look at your policy renewal this cycle and ensure that you have the coverage that is adequate in case of an accident. The insurance premium increase may not be as great as you fear.
Most significant changes
Whether you are buying a new policy or renewing an existing one, you should be aware of the most significant changes to statutory accident benefits:
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Benefit
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Current Policy
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New Policy
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Medical and Rehabilitation for non-catastrophic injuries
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$50,000
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These benefits have been combined and reduced to $65,000 total
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Attendant Care for non-catastrophic injuries
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$36,000
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Medical and Rehabilitation for catastrophic injuries
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$1,000,000
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These benefits have been combined and reduced to $1,000,000 total
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Attendant Care for catastrophic injuries
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$1,000,000
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Some important things to remember about these benefits:
- If you have previously chosen to purchase optional benefits to increase these amounts, check your policy – they may have changed to reflect amounts available in new options.
- Medical, Rehabilitation and Attendant Care benefits for minor injuries are fixed at a maximum limit of $3,500.
The optional benefits available for Medical, Rehabilitation and Attendant Care have also changed:
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Current Optional Benefit
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Optional Benefit available on or after
June 1, 2016
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Non-catastrophic injuries
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Medical and Rehabilitation for non-catastrophic injuries $100,000
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$72,000 and $100,000 options have been eliminated.
New: Combined Medical, Rehabilitation and Attendant Care of $130,000** for non-catastrophic injuries.
If you have previously chosen to purchase these optional benefits check your policy or contact your agent or broker – they may have changed to reflect the amount available in this new option.
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Attendant Care for non-catastrophic injuries
$72,000
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| |
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​ ​Catastrophic injuries
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Not available
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New: Combined Medical, Rehabilitation and Attendant Care of $1,000,000 for catastrophic injuries only.
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The $1,000,000 Medical, Rehabilitation and Attendant Care optional benefit for all injuries (non-catastrophic and catastrophic) remains unchanged. If you have previously chosen to purchase this optional benefit it will appear on your new policy.
The chart below illustrates the overall benefit limits available depending on which optional benefit or combination of optional benefits you purchase, if any:
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Options:
Medical, Rehabilitation and Attendant Care
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Maximum for
Non-catastrophic injuries
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Maximum for
catastrophic injuries
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Standard: No options purchased
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$65,000**
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$1 million
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$130,000 combined (non-catastrophic injuries)*
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$130,000**
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$1 million
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$1 million (all injuries)*
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$1 million
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$2 million
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$1 million (catastrophic injuries)
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$65,000**
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$2 million
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Combinations:
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$130,000 combined (non-catastrophic injuries)
+ $1 million (catastrophic injuries)
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$130,000**
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$2 million
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$1 million (all injuries) + $1 million (catastrophic injuries)
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$1 million
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$3 million
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*$130,000 optional combined (non-catastrophic injuries) and $1 million optional (all injuries) cannot be purchased together.
** Duration of benefit is five (5) years for adults.
Other Optional Benefits
There are many other options available to purchase additional or increased benefits and coverages. The following chart lists some but not all of those and indicates if those options changed on June 1. You can also choose not to increase any benefit or coverage. If you have previously purchased any optional benefits, you should review your renewal documents as they may have changed.
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Benefit/Coverage
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Current Policy
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New Policy
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You can choose
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Income Replacement benefit
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70 per cent of gross income up to $400 per week.
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No change
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To increase the weekly limit to $600, $800 or $1,000 per week.
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Caregiver benefit
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Available only for catastrophic injuries: Up to $250 per week for the first dependant plus $50 for each additional dependant.
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No change
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To make the same amounts available in current policy for catastrophic injuries available for all injuries.
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Housekeeping and Home Maintenance expenses
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Available only for catastrophic injuries: Up to $100 per week.
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No change
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To make the same amounts available in current policy for catastrophic injuries available for all injuries.
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Death and Funeral benefits
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$25,000 lump sum to an eligible spouse; $10,000 lump sum to each dependant; maximum $6,000 funeral benefits.
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No change
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$50,000 lump sum to an eligible spouse; $20,000 lump sum to each dependant; maximum $8,000 funeral benefits.
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Dependant Care benefit
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Not provided
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Not provided
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To purchase this benefit and add up to $75 per week for the first dependant and $25 per week for each additional dependant to a maximum of $150 per week.
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Indexation benefit
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Not provided
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Not provided
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To add an annual adjustment for inflation for many benefits according to the Consumer Price Index for Canada to your policy.
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Third Party Liability
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$200,000 minimum for claims as a result of lawsuits against you.
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No change
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Options exist to increase the minimum amount.
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Tort Deductible
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$36,905.40 deductible for court awarded compensation for pain and suffering (Jan 1-Dec 31, 2016).
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No change
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Reduce deductible by $10,000 regardless of annual indexation percentage increases.
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Other key changes include:
Minor Accident
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Insurers can no longer use a minor at-fault accident that occurs on or after June 1, 2016 meeting certain criteria to increase your premiums. The criteria include that no payment has been made by any insurer, that there are no injuries, and that damages to each car and property were less than $2,000 per car and were paid by the at-fault driver. This provision is limited to one minor accident every three years.
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Interest Rate for Monthly Payment Plans
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The maximum interest rate that insurers can charge if you make monthly premium payments has been lowered from 3% to 1.3% for one year policies, with corresponding reductions for shorter terms.
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Comprehensive Deductible
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The standard deductible for Comprehensive coverage has been increased from $300 to $500.
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Non-Earner benefit
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The six-month waiting period for people who are not working to receive benefits has been reduced to four weeks. Conversely, benefits can now only be received for up to two years after the accident.
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Duration of Medical, Rehabilitation and Attendant Care benefits
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For all claimants except children, the amount of time that you can receive this standard benefit is now five years for non-catastrophic injuries, and it will be paid only as long as you remain medically eligible.
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