Automobile Insurance — Coverage for Injured Parties
Auto insurance is a hot topic these days as premiums continue to escalate. And if you live and drive in Ontario the law requires you to have auto insurance.
If you are involved in a motor vehicle accident, auto insurance covers not only damage to your vehicle, but it also provides coverage for your medical expenses and replacement income until you are able to return to work.
In this article we provide you with an overview of the coverage available to injured parties.
If you are injured in an auto accident there are two different streams that you can potentially claim under: liability coverage and accident benefits. You have access to at least some of this coverage regardless of whether you are a driver, passenger, cyclist or pedestrian and regardless of who was at fault.
Liability coverage compensates you for pain and suffering as well as certain other losses. However, Ontario law limits who can make such a claim to those who have suffered a serious and permanent disfigurement or impairment. In addition, any such claim is subject to a $15,000 deductible.
Accident benefits are intended to lessen economic losses resulting from your injuries. The benefits include:
o Income replacement (up to $400 a week);
o Payments to non-earners who suffer complete inability to carry on a normal life;
o Payment of care expenses to persons who cannot continue to act as a primary caregiver for a member of their household; and
o Payment of medical, rehabilitation (up to $100,000) and attendant care expenses (up to $72,000).
Accident benefits are mandated by legislation and therefore are standard under all insurance policies. However, you may also purchase optional benefits to increase the basic level provided.
Making a Claim
If you are injured in an accident, you should contact the insurance company as soon as possible. The insurer will provide you with an Application for Accident Benefits. The insurer may also want forms filled out by your doctor and employer. In addition, a representative of the insurance company will probably want to meet with you to obtain a statement about the accident and your injuries.
Once you have completed and returned the Application for Accident Benefits, the insurance company has 14 days to get back to you. If the insurer does not approve your medical treatment you will be sent for an independent assessment.
Aside from the benefits you are entitled to under this portion of your coverage, you may also have a claim for pain and suffering if you have suffered a serious injury. In this case it is particularly important that you seek prompt legal advice.
The above explains the system as it currently exists, however, there is much talk at the moment about reforming the system. In July, the Eves Government released its White Paper – Automobile Insurance Affordability Plan for Ontario: Next Steps. Among other things, the proposed changes are said to address rising premiums.
The following are some of those proposed changes.
o The introduction of an assessment and treatment program of care for whiplash and related minor injuries referred to as a Pre-Approved Framework to allow for quicker access to treatment.
o A restriction on the use of medical examinations by insurers in order to end duplication and reduce costs.
o A prohibition against cash settlements for accident benefits until one year has passed; allowing injured people to continue to have access to treatment and income replacement.
In addition, the government is also considering other changes, including:
o An increase in the deductibles which apply to awards for pain and suffering from $15,000 to $30,000 for Insurance Act awards and from $7,500 to $15,000 for Family Law Act awards.
o A change to the threshold at which an injured person can sue for pain and suffering to focus on severe physical, rather than mental or psychological injuries.
The government believes that these various changes will ultimately lead to lower premiums. We will continue to keep you appraised of the status of this important legislation, particularly in wake of the upcoming provincial election.
If you have any questions, or if you have been involved in a motor vehicle accident contact Nicola Savin.Share