Auto Insurance Changed June 1, 2016 - Are you prepared?

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There was not a lot of coverage of the significant changes that were made to the Ontario Auto Insurance benefits regime this summer. Coverages for personal injury were reduced drastically in an effort to help insurance companies reduce premiums to customers. Sadly, the changes in coverage will leave many injured people without the resources to recover from their injuries.

As an owner of a car you are required to buy car insurance. Your policy is effective for one year and upon renewal you will be advised of the changes and details of the reduced benefits. You should be aware of the changes now, and be ready to call your broker or insurance company immediately to purchase optional coverage increases.

FSCO published a bulletin outlining the changes. They recommend you take the following steps:

  1. Read the "Important Changes to your Policy!" document that came in your renewal package. See if the changes reduce or eliminate something that was important to you, and if so what you can do about it.
  2. Compare the new policy to your current policy to see what changes have been made. Remember, if you have benefits from your employer or another policy, you may already have some level of coverage for some or all of the changes made. You should consider these benefits as you review your coverage options.
  3. Understand your policy. Call your insurance representative and ask questions, or do some additional reading, to make sure you understand auto insurance or what a coverage means. Make sure you know what options are available to increase or purchase other benefits, or to reduce premiums by increasing deductibles or taking advantage of discounts.
  4. Shop around. There are many insurance companies competing on price and service in Ontario, and you should make sure that you compare at least three quotes for the same coverages before making a decision. You may purchase a policy through a licensed insurance broker, insurance agent or from a direct writer. There are many ways to save on auto insurance.

As you can see in the charts below,  the coverages are significantly reduced, and while the amounts may seem adequate at first glance, it’s important to remember that the costs of rehabilitation quickly mount in case of a serious injury, particularly if you are required to hire an attorney and pay their fees.

Most significant changes

Whether you are buying a new policy or renewing an existing one, you should be aware of the most significant changes to statutory accident benefits:

 

Benefit

Current Policy

New Policy

Medical and Rehabilitation for non-catastrophic injuries

$50,000

 

These benefits have been combined and reduced to $65,000 total ?

Attendant Care for non-catastrophic injuries

$36,000

Medical and Rehabilitation for catastrophic injuries

$1,000,000

 

These benefits have been combined and reduced to $1,000,000 total ? 

Attendant Care for catastrophic injuries

$1,000,000

 
Some important things to remember about these benefits:

  • If you have previously chosen to purchase optional benefits to increase these amounts, check your policy – they may have changed to reflect amounts available in new options.
  • Medical, Rehabilitation and Attendant Care benefits for minor injuries are fixed at a maximum limit of $3,500.

The optional benefits available for Medical, Rehabilitation and Attendant Care have also changed:

 

Current Optional Benefit

Optional Benefit available on or after 
June 1, 2016

 

Non-catastrophic injuries

 

Medical and Rehabilitation for non-catastrophic injuries $100,000

$72,000 and $100,000 options have been eliminated.

New: Combined Medical, Rehabilitation and Attendant Care of $130,000** for non-catastrophic injuries.

If you have previously chosen to purchase these optional benefits check your policy or contact your agent or broker – they may have changed to reflect the amount available in this new option. 

 
 

?Attendant Care for non-catastrophic injuries $72,000

 
 

Catastrophic injuries

 

?Not available

New: Combined Medical, Rehabilitation and Attendant Care of $1,000,000 for catastrophic injuries only.?

 

 The $1,000,000 Medical, Rehabilitation and Attendant Care optional benefit for all injuries (non-catastrophic and catastrophic) remains unchanged. If you have previously chosen to purchase this optional benefit it will appear on your new policy. 

The chart below illustrates the overall benefit limits available depending on which optional benefit or combination of optional benefits you purchase, if any:

 

Options:
Medical, Rehabilitation and Attendant Care

Maximum for 
Non-catastrophic injuries

Maximum for
catastrophic injuries

Standard: No options purchased

$65,000**

$1 million

$130,000 combined (non-catastrophic injuries)*

$130,000**

$1 million

$1 million (all injuries)*

$1 million

$2 million

$1 million (catastrophic injuries)

$65,000**

$2 million

Combinations:

$130,000 combined (non-catastrophic injuries) 
+ $1 million (catastrophic injuries)

$130,000**

$2 million

$1 million (all injuries) + $1 million (catastrophic injuries)

$1 million

$3 million

*$130,000 optional combined (non-catastrophic injuries) and $1 million optional (all injuries) cannot be purchased together. ** Duration of benefit is five (5) years for adults.