Q: How does car insurance coverage in Ontario differ from that of other provinces?
A. After the June 1, 2016 changes, Ontario's Accident Benefits Coverage ─ still remains one of the most generous in Canada, when compared to other provinces with similar systems of car insurance. Ontario's standard $65,000 Medical, Rehabilitation and Attendant Care benefit limit (for injuries that are neither minor nor Catastrophic) compares favourably to $50,000 in Alberta and New Brunswick or $25,000 in Nunavut, North West Territories, Nova Scotia and Prince Edward Island.
Ontario is also the only province with privately delivered insurance that allows the purchase of additional coverage.
Q: Will the June 1, 2016 changes lower the price I pay for my car insurance?
A: The governments intent in making these changes is to stabilize pricing ─ not necessarily to lower it. Leading up to these changes, the cost of claims was increasing each year…ultimately causing insurance companies to pay out far more than premiums covered. These changes were designed to control the factors that have recently driven the price of insurance upward.
By making these changes to car insurance in Ontario, future claims costs should be reduced or stabilized. This should lessen or eliminate the need to continue the large rate increases experienced by many Ontario drivers over the past few years. These measures are also aimed at reducing fraud and abuse of the system, which increase premiums.
Q: How much will the optional benefits cost?
A: Each insurance company has been required to file its new rates for optional benefits for approval by Ontario's insurance regulator, the Financial Services Commission of Ontario (FSCO). Pricing will vary from insurer to insurer, as they have unique underwriting and rating rules. The pricing also will vary for individual drivers.
Q: What happens when consumers' policies come up for renewal? How will consumers be notified?
A: Because it is important to ensure that consumers are provided with an opportunity to make an informed decision when purchasing or renewing automobile insurance, drivers will be informed about new options available to them through mandatory point-of-sale disclosure.
FSCO has worked with key stakeholders to launch consumer education initiatives, including point-of-sale disclosure of the new choices consumers will have when purchasing automobile insurance coverage.
By ensuring people are informed, the government is encouraging accountability so that people purchase the appropriate coverage for them and their families.
Q: What defines a "minor injury"?
A: Minor injuries, with respect to an auto accident, are sprains, strains, dislocations, lacerations, contusions, abrasions and whiplash injuries without nerve damage or a fracture.
Sprain means an injury to one or more tendons or ligaments, or both, including a partial but not a complete tear.
Strain means an injury to one or more muscles, including a partial but not a complete tear.
Q: Did the government change the cap of $3,500 for minor injuries?
A: No, this cap on medical and rehabilitation expenses for treatment of minor injuries (whiplash, sprains, strains, contusions, dislocations, lacerations and abrasions) is has not changed since the last reform.
In Ontario, spending on medical expenses for auto accident victims is growing at an annual rate of nearly 16 per cent. However, the number of people injured in auto accidents has remained steady.
When compared to other provinces, medical expenses are quite high. Bringing the cost of treating similar injuries in line with other jurisdictions will alleviate cost pressures in Ontario.
Q: What happens to claimants whose accidents were before June 1? Are their benefits reduced?
A: They will be entitled to the same benefits that were in their policy at the time of their accident. That means they will continue to be able to claim up to $50,000 in medical and rehabilitation benefits and $36,000 in attendant care benefits for non-catastrophic injuries and $1,000,000 for medical and rehabilitation and $1,000,000 for attendant care for catastrophic injuries. When their policies get renewed on or after June 1, the benefits will change.
Q: What other changes will apply to older claims on and after June 1?
A: Reducing the maximum duration of medical and rehabilitation benefits from 10 years to five years for all claimants except children. Injuries do not require 10 years of med/rehab treatment. A 10-year period became an incentive to reopen claims that had remained dormant for several years and greatly increased uncertainly as to what the ultimate cost a given year’s injury claims would end up being.
This five-year limit remains longer than claim duration available in other provinces, which is two years in Alberta and four years in the Atlantic provinces. Consumers will also have the choice to increase their coverage.