Victoria Edwards, a personal injury lawyer with Siskinds LLP, was recently published in Law360.
This article was originally published by Law360™ Canada, part of LexisNexis Canada Inc.
Read the full article below.
Victoria Edwards – Law360™ Canada – Posted: February 23, 2024
When opening a new file for a client who has been injured in a motor vehicle collision, it’s a good idea to inquire about optional policy endorsements with your client’s automobile insurer. Many clients don’t know or don’t remember their policy endorsements, so it’s helpful to have a copy of their Certificate of Automobile insurance to review with them. Depending on which policy endorsements your client has purchased, there can be significant implications for future civil litigation. Automobile insurance endorsements come in the form of Ontario Policy Change Forms (OPCF). They allow people to increase their insurance protection following a car accident in certain circumstances. There are many different types of OPCF insurance endorsements to consider. Some common ones include:
- OPCF-5: Permission to Rent or Lease Automobiles and Extending Coverage to the Specified Lessee(s): This endorsement extends your insurance protection to a vehicle that you drive that is owned by a leasing company.
- OPCF-20: Coverage for Transportation Replacement: This endorsement allows you to choose a rental car or hire a taxi while your vehicle is being repaired.
- OPCF-27: Liability for Damage to Non-Owned Automobiles: This endorsement provides up to$50,000 in property damage protection in the event you damage someone else’s car while driving it.
- OPCF-39: Accident Forgiveness: This endorsement provides a one-time free pass that protects your premium if you get into an accident that is your fault. This “free-pass” only applies as long as you are with the same insurance company. If you switch insurers, your rates may be higher.
- OPCF-43: Removing Depreciation Deduction: If your vehicle is a write-off after an accident, this endorsement means that you will receive the Replacement Cost of your vehicle, without deducting the depreciation value.
- OPCF-44R: Family Protection Coverage: This endorsement provides protection for you if you are injured in a car accident caused by someone without insurance, or without adequate insurance.
- OPCF-48: Added coverage to Offset the Tort Deductibles (for Ontario): If you start a lawsuit as a result of injuries sustained in a car accident, the defendant typically gets a deduction for pain and suffering damages. This endorsement reduced the deduction by $10,000 (or $5,000 for Family Law Act claims).
Family Protection Coverage
Perhaps the most important insurance endorsement to have in the civil litigation context is the OPCF-44R Family Protection Coverage. The OPCF-44R provides extra protection for your clients in circumstances where the at-fault driver either has no insurance or inadequate insurance to pay for your client’s damages.
The amount of coverage is equal to the third-party liability coverage purchased by your client. In Ontario, it is the law that each motorist must have at least $200,000 in third-party liability insurance. If someone purchased this coverage, they would have $200,000 available through the OPCF-44R in the event they were injured by a motorist without insurance. If your client has purchased additional third-party liability insurance, their Family Protection Coverage increases as well.
The OPCF-44R does not stack up against the at-fault driver’s coverage. If your client has coverage of $1,000,000 and the defendant has third-party liability insurance of only $200,000, your client’s OPCF-44R insurer would only pay up to $800,000 to bring the total limits available to your client up to $1,000,000. Having the additional coverage can be crucial for people who have sustained serious injuries in motor vehicle accidents. If your client is no longer able to work or will require an extensive rehabilitation team’s support for many years, it is unlikely that $200,000 will cover all their needs. You will want to know early in the litigation what insurance limits are available at the end of the lawsuit so that you can manage your client’s expectations.
Tort deductible
Another important insurance endorsement in the civil litigation context is the OPCF-48 endorsement to offset the tort deductible. Pursuant to s. 267.5 of the Insurance Act and O. Reg. 461/96 s. 5.1, the defence insurer gets a deduction on the plaintiff’s non-pecuniary general damages in car accident cases. The amount increases every year with inflation. As of 2024, the deductible amounts are $46,053.20 for injured persons, and $23,026.61 for FLA claimants. These deductions do not occur if the plaintiff is awarded more than $153,509.39, or FLA claimant awarded more than $76,754.04 for non-pecuniary damages.
The OPCF-48 Tort Deduction Offset reduces the deductible amount by $10,000. This could make a big difference if the plaintiff’s net damages award brings them close to the defendant’s Rule 49 Offer. The Rule 49 Offer, made pursuant to Ontario’s Rules of Civil Procedure, is the best offer a party makes preceding a trial. If the plaintiff is awarded less than the defendant’s Rule 49 Offer, then they may be ordered to pay for the defendant’s legal fees. In cases with relatively minor damages that are greatly reduced by the insurance deductible, having this endorsement could be the difference between paying tens or hundreds of thousands of dollars in legal fees.
Conclusion
There are many optional insurance endorsements available beyond the minimum coverage. Most brokers will ensure that people have the OPCF-44R included in their automobile insurance policy. It will be important to know how much additional coverage is available for cases where the defendant may not be adequately insured. The less well-known OPCF-48 endorsement could also play a big role in reducing the risk for plaintiffs. Many people are not overly familiar with their own insurance terms, so it would be a good idea to review the Certificate of Automobile Insurance early in the case so that you know about all the useful tools for your case.