Bad News for Crash Victims

Author(s): Darcy R. Merkur

May 30, 2015

Last month’s Ontario budget continued the erosion of accident benefits for victims in motor vehicle accidents.

The reductions are most significant for those suffering from catastrophic injuries.

Since 1996, these victims were entitled to reasonable and necessary medical and rehabilitation services up to $1 million, in addition to up to $1 million in attendant care benefits.

That combined coverage of $2 million will now be cut by 50% to a combined $1 million.

It’s puzzling why the government would want to cut back benefits to those who need it most, especially since only 1% of accident victims suffer catastrophic injuries.

Ontario Finance Minister Charles Sousa stated, “Ontario is the most generous in Canada when it comes to providing coverage for auto insurance.”

I guess he isn’t aware Manitoba, Saskatchewan and Quebec provide medical rehabilitation benefits in excess of Ontario’s $1 million, when medically warranted, for any motor vehicle accident victim.

At the other end of the spectrum, dealing with so-called minor injuries suffered by approximately 80% of accident victims, Ontario’s “generous” limit for medically necessary treatment is $3,500, including the cost of assessments, examinations and reports.

No other province mandates a cap on minor injuries.

Don’t think these “minor” injuries are insignificant.

They include dislocation of joints, partial tears of tendons, ligaments and muscles, contusions, abrasions, lacerations and whiplash not exhibiting neurological symptoms.

For serious injuries — neither minor nor catastrophic — medical and rehabilitation benefits are capped at $50,000 in Ontario. That compares favourably to Nova Scotia, PEI, Nunavut and the NWT, which each have a limit of $25,000, and equals the limit in Alberta and New Brunswick.

But it falls short of the limits in British Columbia, Manitoba and Saskatchewan.

So, the most generous benefits in Canada? Hardly.

The lowering of benefits for catastrophic injuries is only one of many prejudicial changes to auto insurance coverage announced in the budget.

There’s also enhanced barriers imposed on plaintiffs suing for negligence arising out of auto accidents.

Most people are unaware of two barriers on the right to sue for damages resulting from harm suffered in an at fault auto accident.

First, there is a threshold test that must be satisfied before anyone can succeed in winning a lawsuit.

This law, introduced in 1996 and made more stringent in 2003, bars successful lawsuits unless plaintiffs can establish they suffer “from permanent serious impairment of an important physical, mental or psychological function.”

To meet this test, various stringent conditions must be satisfied.

The threshold often prevents injured people from recovering damages for serious injuries that fail to meet its definition.

Second, there is a deductible that applies only to lawsuits against negligent auto drivers. It was increased from $15,000 to $30,000 in 2003 and applies to damages for pain and suffering of $100,000 or less.

The budget would index the deductible to inflation as of 2003.

According to personal injury lawyer Darcy Merkur, that would impose a deductible of about $37,000 on damage awards of about $123,000 or less. As an example, a damage award of $100,000 would be reduced to $63,000!

Having both a threshold and a deductible is redundant and only benefits insurance companies.

And why would the government choose to index amounts that favour insurance companies, while not indexing amounts that favour accident victims?

I didn’t see any proposal to index the minor injury cap of $3,500 or the medical/rehab cap of $50,000.

As FAIR Association of Victims for Accident Insurance Reform says, “The budget does nothing to ensure that insurer claims management practices are fair and there has been no action (to deal with) … the biased and corrupt insurer medical examination reports that are disqualifying innocent and legitimate accident victims.”

The government also announced it intends to amend the catastrophic impairment definition.

Does anyone doubt that these amendments will only serve to benefit insurance companies by restricting the number of victims who would otherwise qualify for the enhanced benefits applicable to the catastrophically impaired?

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