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Personal Injury Law: Insurance changes a catastrophic ambush

As part of the provincial budget announced on April 23, the Ontario government has decided to first throw seriously injured accident victims off the bus and then deprive them of the ability to make a good recovery. The announcement comes as a total blindside to interested stakeholders.

Historically, whenever the Ontario government was considering major changes to automobile insurance legislation, there was widespread consultation with stakeholders. That consultation process consistently revealed it was common ground among all stakeholders that it was sacrosanct to reduce the benefits available to the most seriously injured persons. As a result, prior changes focused on changes other than reductions in the benefits available to the catastrophically impaired.

The government’s announcement includes five major changes. Each change reduces the funding available to accident victims. Each change reduces the chance for an accident victim to regain their independence. Each change results in further pressure on the currently underresourced public health care system.

The changes, in order of least to most significant, are:

—    A reduction in the benefit maximums in non-catastrophic impairment claims from the current total maximum of $86,000 (being $50,000 for medical and rehabilitation benefits plus $36,000 in attendant-care benefits) to a combined total of $65,000. In addition, the duration for accessing these benefits falls to five years from 10 years except in cases involving children. Prior to the Sept. 1, 2010, changes, these benefits totalled $172,000, so the new reduced maximum, after accounting for inflation, is about a 65-per-cent reduction from the amounts available prior to that time.

—    A reduction in the duration of eligibility for non-earner benefits from life to a maximum of two years (albeit without the six-month waiting period that currently applies). This change will affect students the most as they had previously qualified for a higher weekly benefit rate of $320 a week after two years. For example, a seriously injured teenager who will never work again because of accident-related injuries will now be unable to access the weekly benefit.

—    Indexing the tort deductibles to inflation since 2003. This change means that anyone with a valid claim for pain and suffering will face an inflated deductible of roughly $37,000 instead of the current $30,000 unless their pain and suffering award is assessed at more than the inflated vanishing deductible of roughly $123,000. While this change is arguably an attempt to adjust the previous deductibles to the level intended in 2003, it’s notable that the accident-benefit limits have all remained unchanged by inflation for the last 20 years.

—    The intention to revise the definition of catastrophic impairment purportedly in an effort to capture only the most seriously injured persons. Given that the expert panel on this issue had recommended the removal of the simple, efficient, and popular Glasgow coma scale test, the revised definition will undoubtedly be seen as a significant narrowing of the catastrophic impairment designation. Moreover, by changing the now well-understood tests that have been in place for close to 20 years and by eliminating the simple and easy Glasgow coma scale test, identifying who will qualify for catastrophic impairment will be more challenging.

—    A reduction in the maximum benefits available to catastrophically impaired people from $2 million ($1 million in medical and rehabilitation benefits plus $1 million in attendant-care benefits) to a total of $1 million. This $2-million maximum has been in place for roughly 20 years and, after accounting for inflation on all of the potential benefits, these further changes will cut the amounts by roughly 70 per cent of what was available back in 1996.

Insurance, by its nature, is there to protect against unexpected events. The government’s announced reductions to automobile insurance benefits provide no such protection. The changes serve to defeat the very purpose of mandatory automobile insurance in Ontario.

The government is making these changes as part of an attempt to address the political pressure to reduce automobile insurance premiums. However, it’s making the changes without an investigation into the legitimate questions about the excessive profits earned by the very insurers the government is trying to appease and before it has assessed the savings from the last round of reforms.

Through these reductions, the Ontario government has sacrificed the most vulnerable citizens for political gain.


Darcy Merkur is a partner at Thomson Rogers in Toronto practising plaintiff’s personal injury litigation, including plaintiff’s motor vehicle litigation. He’s a certified specialist in civil litigation and creator of the Ontario personal injury damages calculator.

  • Claim Accident Services

    Claim Accident Servi
    Govt is busy in gaining the benefit from the insurance companies, by being the props in their hands. Govt have Forgotten every person who elected them to the power and now they are returning favor. Seriously injured people are reeling under pain and debt they have to pay for their treatment. People in power are shrewd who are now making every possible move to snatch people hard earned money by protecting the insurance firms.
  • Anthony Mineault
    Dear Chas M, I disagree with your position. Rather than blaming the plaintiff's lawyers - who serve victims and essentially fight for the underdog - you should investigate the actions of insurance defence lawyers and their clients the insurance companies. They are the ones driving up costs by unnecessarily obfuscating and delaying payment for compensation on rightful claims. Fraudulent claims are rare and most if not all plaintiff sided law firm are not complicit with such fraudulent activities. We actively weed out such claims and refuse to represent those individuals. Greedy insurance defence lawyers and insurers are the ones driving the cost up. They only make billions of dollars in profit every year yet they routinely cry that they cannot operate in the red. This is factually false. They reap in huge amounts of profits while they exercise unparalleled lobbying at Queens Park to screw the consumer out of fair and appropriate protection.
  • Chas M
    People, we can thank firms like Thomson Rogers for being DIRECTLY responsible for driving up the costs of auto insurance. Virtually every single client they represent claims to be CAT impaired. The latest scam is claiming to be "psychologically" impaired, likely after a very minor MVA. I see it almost every day.
  • Susan Fraser
    Darcy thank you for summarizing the horrific changes proposed by the government which will only support insurers profits and harm injured people. But I shudder with concern for all future catastrophically injured. I have worked as a healthcare practitioner treating catastrophically injured individuals for over 20 years and experienced many legislative changes. Very few in any have benefited the injured person. With the marked reduction in benefits, many catastrophically injured clients will not have sufficient funds to enable them to return to a quality of living they deserve. For instance a spinal injured person dependant on a wheelchair for basic mobility will have to chose how to spend his med/rehab funds.. Costly home modifications to renovate his home into barrier free environment (this could easily use 50-75% of $500,000) or therapy across his life time and a power wheelchair and high quality adjustable bed.
  • Tammy Kirkwood
    Thank you Mr. Merkur for a brief summary of the, once again, ABUSE, this government and the insurers are doing to traumatize MVA victims. They continue to decrease or eliminate the funds and resources necessary to enable a maximum recovery. Public Services are also undergoing decreases & eliminations to all persons with a legitimate disability. As a MVA survivor myself, I fully understand the time, effort, stress and money it takes to try and be a functional person in my life and society. I will live with my deficits forever! The public consumers need to wake up. They need to stand up and look at what they will lose, if they or a loved one is injured in Ontario!
  • David Baker
    A previous Liberal government had the courage to deliver a basic no frills package of benefits. This government couldn't make the insurance industry meet the needs of those disabled in motor vehicle accidents. Time to revive the call for public auto insurance. It works for drivers and accident victims in other provinces.
  • Chas M
    Actually, not so much. All three of the public auto insurance companies went BANKRUPT and had to be BAILED OUT by taxpayers, many of which don't drive or own cars. And, do you really think we need MORE public servants at the trough? You obviously have no idea what you are talking about.
  • Linda Sims
    Why is this a surprise? Ontarians elected the worst backstabbing, lying group of thieves that ever existed and continue to blindly re-elect them year after year without any real pressure from an alternate party.

    The conservative leadership campaign is a joke so be prepared for another decaded or two of liberal lies and theft.
  • Devils Trumpet
    We have a Liberal government whom claimed to be the only compassionate political party while at the same time both the Premier and the Minster of Finance are pocketing cash from the IBC.These changes were bought and paid for prior to the last election and it is an example of this government's absolute malicious contempt for the injured and disabled in this province.These changes were promoted as a method to combat fraud or to ensure the money goes to the accident victim instead of the lawyers but it does neither.Insurance companies reap expodendial profit,the taxpayer pays the industry's bills and Liberal party members enjoy financial support from the IBC.
  • concerned citizen
    Thank you Mr. Merkur for an excellent summary on the latest outrageous moves by the Government to eviscerate accident benefits. They have clearly abandoned accident victims in favour of pleasing insurance companies. Sad really.
  • Chris Anon
    Typo or incorrect word choice? It currently reads "That consultation process consistently revealed it was common ground among all stakeholders that it was sacrosanct to reduce the benefits available to the most seriously injured persons." Should "reduce" be "protect" or perhaps "unacceptable" instead of "sacrosanct"?
  • ari s
    every time I read the reductions, it makes me sick.
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