Amendments to the Ontario Insurance Act that Affect the Motor Vehicle Accident Deductible

In this section, we will go over the new amendments to the Ontario Insurance Act that affect car accident deductibles. After highlighting the deductible changes, we will go over a few tips on what you need to do to ensure you understand your options and that you’re adequately protected.

Amendments to the Ontario Insurance Act that Affect the Motor Vehicle Accident Deductible

As a policyholder, it is important to ensure you have adequate protection should a car accident occur whether or not you were at fault. The Government of Ontario has made amendments to the Ontario Insurance Act to help policyholders access adequate compensation to cater for their injuries, pain, and suffering. The car accident deductible changes were effective on August 1^st, 2015 and resulted in lower costs for insurance companies.

Highlighting the Major Changes

In car accident cases, victims do not receive the full amount of compensation awarded for pain and suffering and loss of enjoyment of life. There is a deductible (an amount that is deducted from all awarded non-pecuniary damages) applied unless the claim is more than $131,854.01(effective until December 31^st, 2020). Injured car accident victims may even be required to pay the insurance company legal costs if the award doesn’t exceed the deductible.

Before the 2015 amendment, the deductible was $30,000. In January 2019 it was increased to $38,818.97. The deductible now stands at $39,556.53 until December 31^st, 2020. This means that if a car accident victim is awarded $100,000 for pain and suffering, they will only receive $60,443.47. This also means that if awarded about $30,000 for pain and suffering, you will not receive any compensation since the amount is lower than the deductible. Additionally, you may have to pay the insurance company for the expenses incurred during the trial. The deductible for family members claiming compensation for pain and suffering was increased to $19,409,49 in 2019 and it now stands at $19,778.27 effective until December 31^st, 2020. The deductible can only be waived if the claim exceeds $65,926.45 (before this threshold was $64,697.21).

What You Need to Do

When it’s time to renew your car insurance policy, find out if you’ll have lower benefits and what you can do to get adequate coverage. There are optional coverages that you may consider taking in order to ensure you’re adequately protected in case of a car accident. We suggest taking the following steps:

• Go over and ask about any important changes made to your policy. Changes are usually stated in your renewal package. If anything, that was important to you has been reduced or eliminated, find out what other options you have.
• Compare your new policy with the existing one to see what changes have been made. Keep in mind that you may have some other coverage from other sources such as your employer.
• Understand all the options you have not only to increase or purchase other benefits but also to reduce premiums. You can increase your deductible or take advantage of discounts to pay less premiums.
• Most importantly, shop around for options. Insurance companies compete on price and service so get several quotes before making a decision.

In the unfortunate event that you are involved in a car accident and you’re considering filing a lawsuit, get a car accident lawyer by your side. You’ll need sound legal advice to get the maximum benefits that you are entitled to.