WARNING: Your Auto Insurance is Changing, What You Need to Know

If you are injured in an auto accident, you are entitled to certain statutory accident benefits – commonly referred to as "no fault" benefits – from your insurance company. The Ontario government, working in conjunction with the insurance industry, has radically changed some of these benefits. These changes came into effect on June 1, 2016 and will impact you and your loved ones if you or they are ever injured in a car accident. Here is what you need to know and what you can do to protect yourself.

Current Benefits

  • Non-Earner Benefits: This benefit is for people who were not working at the time of the accident, but who are so affected by the accident that they are completely unable to carry on a normal life. They are entitled to $185 per week. There is a six-month waiting period for this benefit, but those who qualify can receive these payments for the rest of their life (with a reduction at age 65).
  • Medical and Rehabilitation Benefits: These benefits are for treatments that are not covered by OHIP (e.g. chiropractic care, massage therapy, speech therapy and physiotherapy). There are three levels of benefits, depending on the type of injuries sustained in the accident:
  1. Catastrophic injuries: People with serious injuries such as head injuries, paraplegia, and dismemberment are entitled to medical and rehabilitation benefits up to $1 million over their lifetime.
  2. Minor injuries: People with minor sprain and strain injuries are limited to $3,500 in medical and rehabilitation benefits.
  3. Standard benefit level: People who have injuries such as broken bones, complete tears and psychological conditions are entitled to medical and rehabilitation benefits up to $50,000. These benefits are available any time up to 10 years following the accident.
  • Attendant Care Benefits: These benefits are for those who require assistance from a personal aid worker or a nurse. The amount of the Attendant Care Benefit depends on the seriousness of the person's injuries:
  1. People with catastrophic injuries are entitled to $6,000 per month in Attendant Care Benefits, up to a total of $1 million over their lifetime.
  2. People receiving the Standard Benefit Level of medical and rehabilitation benefits are entitled to up to $3,000 per month in Attendant Care Benefits for two years after the accident (for a total of $36,000).
  3. People with minor injuries are not entitled to Attendant Care Benefits.

Changes in 2016

Effective June 1, 2016, these no-fault benefits will be reduced:

  • Non-Earner Benefits will become time limited: The weekly amount will remain the same ($185) but insurance companies will only have to pay this benefit for 104 weeks (two years) following the accident – even if a person continues to suffer a complete inability to carry on a normal life for the rest of his or her life.
  • Medical, rehabilitation and attendant care benefits will be capped:
  1. People who fall under the standard benefits level for medical and rehabilitation benefits will be limited to $65,000 for both medical and attendant care benefits. As an example, this means that a person who spends $50,000 on medical and rehabilitation benefits will only have $15,000 remaining for attendant care benefits – as opposed to the $36,000previously available.
  2. People with catastrophic injuries will be limited to $1 million for both medical and attendant care benefits. This is a significant reduction from the $2 million currently available – $1 million for each of medical and rehabilitation benefits and attendant care benefits.
  • Medical and rehabilitation benefits will be payable for only five years.Insurance companies will only have to pay medical and rehabilitation benefits under the Standard Benefit Level for up to five years following the accident –half the current 10 years they are currently required to provide these benefits.

The definition of what is a "catastrophic" injury will also change, making it more difficult for people to qualify for the catastrophic level of benefits.

These changes will only apply to insurance policies that are renewed on or after June 1, 2016. This means that persons who renew their policies on May 31, 2016 will continue to qualify for the current benefits until May 31, 2017.

What You Can Do

If you are worried about these amendments, there are a number of new optional benefits that can help protect you from some of these changes. The new optional benefits include:

  • An option to increase the Standard Benefit Level for medical, rehabilitation and attendant care benefits from $65,000 to $1 million; and
  • An option to increase the catastrophic benefit level for medical, rehabilitation and attendant care benefits from $1 million to a total of $2 million in coverage.

Purchasing these optional benefits will increase the cost of your insurance premium. However, given the seriousness of the changes, we recommend that you at least speak to your insurance company or broker about when your policy will be renewed and how much these additional optional benefits will cost you.

Frances SFrancesShapiroMunn_headshot-smallhapiro Munn is a member of Nelligan O'Brien Payne's Personal Injury Law Group. She can be reached by email at frances.shapiromunn@nelligan.ca or by calling 613-231-8355. For more information on personal injury law, please visit nelligan.ca.