On Aug. 27, the Ontario government reduced accident benefits purportedly as a way to cut automobile insurance premiums.
While the changes and reductions will surely serve to fatten up an already-fat insurance industry, they’ll also cause further financial distress and hardship for accident victims.
The legislation, set out in Ontario Regulation 251/15, will reduce total accident benefits available to the most seriously injured motorists in Ontario to $1 million from $2 million.
In addition to cutting catastrophic impairment benefits in half, the legislation overhauls the definition that determines entitlement. The overhaul includes the elimination of the popular Glasgow coma scale test as a means to obtain the crucial catastrophic impairment designation and adopts an assortment of new tests.
It’s not that the replacement tests are inappropriate; the concern is that they serve to recreate a wheel that, after 20 years of litigation, was starting to run smoothly. The new tests will lead to confusion, uncertainty, and delays, all of which will have a negative impact on the rehabilitation of seriously injured claimants.
Other legislative changes will reduce the total amount of benefits available to non-catastrophic accident victims to $65,000 from an already-reduced $86,000.
Further, the government has cut the duration of non-earner benefits. Students, the unemployed, stay-at-home parents, and the elderly will no longer qualify for non-earner benefits indefinitely. Instead, they’ll qualify for only two years of benefits.
The new legislation will affect claims arising out of accidents that occur on or after June 1, 2016.
Reduced accident benefits result in magnified tort actions and will lead to expedited litigation along with claims against insurance brokers for failing to recommend adequate insurance to motorists. Given these accident benefit reductions, the common $1-million tort liability policy is undeniably inadequate.
As a result of these changes, the mandatory automobile insurance system in Ontario no longer provides the protection it was designed to provide.
Darcy Merkur is a partner at Thomson Rogers in Toronto practising plaintiff’s personal injury litigation. He’s a certified specialist in civil litigation and creator of the Ontario personal injury damages calculator.