Once again, the standard auto insurance benefits provided in Ontario are shrinking. This means that your own insurance company will provide you with less funds to assist you in recovering from your motor vehicle collision. However, you do have new options for optional coverage that can protect you and give you the coverage you need if you are seriously hurt in a car accident.
All auto insurance policies renewed after June 1, 2016 will now have the following decreased accident benefits in place:
|Benefit||Current Policy||New Policy Renewed
After June 1, 2016
|Medical and Rehabilitation (non-cat)
i.e. funds for physiotherapy, occupational therapy, chiropractic, massage therapy etc.
|$50,000||These benefits have been combined and reduced to $65,000 total |
|Attendant Care (non-cat)
i.e. hiring someone to help you care for yourself after a collision (dressing, bathing etc.)
|Medical and Rehabilitation (catastrophic injuries)||$1,000,000||These benefits have been combined and reduced to $1,000,000 total |
The above are the minimum amounts that must be included with your insurance policy. Sadly not enough consumers effectively utilize the optional benefits they can choose to purchase. The cost of these benefits can be quite modest, vastly improving coverage for a slight percentage increase. Ask your insurance broker to price out these options for you. If you have previously purchased optional benefits, make sure that they have carried over when your new policy renews after June 1, 2016. Some previously available options are now discontinued.
As recently as September 1, 2010, your medical rehabilitation benefits were at $100,000. This is a concerning trend of erosion, particularly when paired with the fact that the period benefits are payable has been reduced from 10 years after the collision to 5 years after the collision. The cap for injuries under the Minor Injury Guidelines (the “MIG”) remains at a maximum limit of $3,500.
While $50,000 for medical and rehabilitation benefits may appear to be sufficient, many consumers run out of funds before they have healed from their injuries. The degree of their injuries, despite in some circumstances requiring multiple surgeries, will not enough to meet the catastrophic definition as provided by the new, more stringent regulations. This makes having enough non-catastrophic Medical and Rehabilitation benefits critical.
The $1,000,000 of Medical, Rehabilitation and Attendant Care optional benefits for all injuries (both non-cat and catastrophic) remains unchanged. This optional benefit remains available for purchase. However, the increase to $72,000 or $100,000 for non-cat optional benefits has now been eliminated. It has been replaced with a combined $130,000 for Medical, Rehabilitation and Attendant Care for non-catastrophic injuries.
These are new optional benefits limits as of June 1, 2016:
|Current Optional Benefit||Optional Benefits available
on or after June 1, 2016
| Non-catastrophic injuries|
|Medical and Rehabilitation for non-catastrophic injuries $100,000||Combined Medical, Rehabilitation and Attendant Care of $130,000 for non-catastrophic injuries
(previously $72,000 or $100,000 available for purchase)
OR – $1,000,000 Medical, Rehabilitation and Attendant Care optional benefit for all injuries.
|Attendant Care for non-catastrophic injuries
| Catastrophic injuries|
|Not available||A combined Medical, Rehabilitation and Attendant Care of $1,000,000 for catastrophic injuries only
(previously $1,000,000 for medical rehabilitation AND $1,000,000 for Attendant Care)
What should you do?
- purchase the optional $1,000,000 Medical, Rehabilitation and Attendant Care optional benefits;
- ensure Income Replacement Benefits are at 70% of your gross weekly wage in increments of $400, $600, $800 or $1,000 per week (i.e. if you earn $1,000 before taxes, 70% gross is $700 – IRBs should be at least $600 or $800) This may not be required if you have excellent Long Term Disability coverage including motor vehicle collisions.
- families with stay at home parents may choose to purchase dependent care benefits to cover daycare costs if they are unable to care for children as a result of the collision.