Optional benefits, are you protected?

Clients often ask us at Grillo Law about optional insurance benefits under the SABS. It may be confusing knowing what is covered under the standard form agreement and what constitutes “optional” or “extra” benefits that are available for purchase.

Insurance benefits can be divided between standard level benefits and optional benefits available for the consumer to purchase at a premium. In general, optional benefits either extend the scope of coverage to a wider spectrum of injuries or situations; or it provides more monetary compensation for damages.

Why should I consider getting optional benefits?

With recent changes to the Statutory Accident Benefits Schedule (SABS) that reduce the amount of standard accident benefits, it may be in your best interests to consider purchasing optional benefits coverage. It can help provide peace of mind and security, as well as being a valuable investment that could pay off in a worst case scenario.

Significant changes in June 2016 mean that the level of standard benefit coverage that many of our clients enjoyed are now diminished or reduced. For many people, purchasing optional benefits will merely return their level of coverage to what it was before the recent amendments.

For example, the prior policy for medical and rehabilitation expenses for non- catastrophic auto injuries amounted to $50,000, plus an additional $36,000 for attendant care expenses. Under the new insurance scheme, these benefits are now combined and reduced to $65,000 in total. There is an option to purchase premium coverage up to $130,000 for these expenses.

Furthermore, for catastrophically injured claimants, the total available benefits for medical, rehabilitation, and attendant care services is now reduced by 50% to $1 million. The purchase of optional benefits can increase this amount to $2 million and maintain coverage at their pre- June 2016 levels.

Comparison between standard and optional benefits.

The following are some of the benefits available in the SABS and the difference between standard and optional levels.

For the income replacement benefit, the standard policy covers 70% of gross income up to $400 per week. Under the optional benefits level, a client may choose to have this increased to $600, $800 or $1,000 per week.

For the caregiver benefit, the standard coverage level is available only for catastrophic injuries, and up to $250 a week for the first dependent plus $50 for additional policy members. The optional coverage makes these amounts available for all types of injuries (and not just catastrophic).

For the housekeeping benefit, the standard coverage includes up to $100 a week in the case of catastrophic injuries. The optional coverage makes this amount available for all types of injuries, including minor and non- catastrophic injuries.

For the medical and rehabilitation benefit, the standard level for injuries classified as “minor” will provide you up to $3500. You are also entitled to $65,000 for non- catastrophic injuries suffered in a motor vehicle accident. Optional benefit levels will increase this amount to $130,000.

For death and funeral benefit the standard policy provides a $25000 lump sum for an eligible spouse and $10000 for each dependent, and a maximum of $6,000 towards funeral expenses. Under the optional benefit scheme, these amounts are increased to $50,000 and $20,000, respectively. Funeral expenses are increased to a maximum of $8,000.

For the tort deductible, a deductible of $37,385.17 applies for claims in 2017. The purchase of optional benefits can reduce this deductible by $10,000.

For third party liability, $200,000 is provided on the standard scale to insure against third party lawsuits. The purchase of optional benefits can extend this minimum amount variously.

Additionally, some benefits are not available at all under the standard form, but are purely optional. These include the dependent care benefit, which if purchased can add up to $75 per week for the first dependent and $25 for each additional dependent up to a maximum of $150 weekly. In order to qualify for this benefit, the insured person must have been employed at the time of the accident, sustained an impairment from the accident, and not be receiving any other caregiver benefits.

Also consider the indexation benefit, which allows clients to add annual adjustments for inflation on the benefit values listed within the SABS.

Learn More About Accident Benefits.

If you have further questions about standard benefits, optional benefits, your current insurance policy, or are seeking advice on the appropriate level of coverage, do not hesitate to contact the experienced professionals at Grillo Law. We can help you analyze your contract and find the right level of coverage that best suits your needs.