No-Fault Accident Benefits Coverage? No Thanks

Author(s): Darcy R. Merkur

March 13, 2016

Ontario drivers are legally required to purchase automobile insurance that includes overpriced, no-fault accident benefits coverage.

If you look at your automobile insurance invoice, you will see that some 25% (or roughly $350) of your annual automobile insurance premiums are specified to be in relation to your mandatory purchase of these no-fault accident benefits.

With the drastic, June 1 benefits cuts coming on the heels of the significant Sept. 1, 2010, benefit cuts, the no-fault accident benefit system has crumbled to a point where the mandatory product is simply undesirable.

Here are some reasons we should be saying “no thanks” to mandatory, no-fault accident benefits:

    1. When you need the benefits, they don’t provide nearly enough money. The new, reduced limits provide benefits of about one-third of what used to be provided. Purchasing optional benefits still means your claim is being handled within the terribly flawed system outlined below;
    2. It no longer provides immediately needed help – changes have been made to the tests for determining if you qualify for enhanced benefits (i.e. if you have suffered a “catastrophic impairment”). Those new tests are generally ones that can only be accessed many months after the accident (well after the most crucial period) and often after a prolonged dispute;
    3. You can’t sue your insurer for mistreatment. To the pleasure of insurers, the Ontario government added in a new law prohibiting lawsuits against insurers about the handling of your claim, leaving insurers largely immune from punishment for any misconduct;
    4. It pays less than the minimum wage for attendant care assistance. Where professional attendant care assistance is needed, the insurer is only required to pay hourly rates that are less than the minimum wage, so you can’t really find anyone to help. Further, the insurer does not have to pay your family for helping you unless your loved one gives up an employment opportunity;
    5. If you already have private insurance through work, your car insurance accident benefits can only be accessed after you have recovered everything available from your group health insurance. Those with good health insurance policies may never be able to access their mandatory, no-fault benefits. For example, if you have access to short or long term disability benefits, you are still paying for an insurance policy that includes access to income replacement benefits that you don’t need; and,
    6. The insurer-initiated assessments are controversial and expensive. The accident benefit system allows insurers to spend money to have their preferred providers review whether you need the care recommended by your treatment providers. Often, the costs of these assessments outweigh the cost of the treatment in dispute, resulting in very limited value being received by the claimant.

We all want protection in case something goes wrong. We all want to be able to afford paying for needed care when an accident happens. What we don’t want is a system where the funding cannot be accessed in a timely way and where it is inadequate to provide the needed care and treatment.

The Ontario compulsory auto insurance system was designed to protect accident victims, but with the June 1, 2016, amendments, it has become an overpriced, bureaucratic mess.

The majority Liberal government in Ontario has reduced benefits and handcuffed accident victims’ rights to the point that the public should say “no thanks” to no-fault accident benefits.

View original article as it appeared in the on Saturday, March 05, 2016 – No fault? No thanks – Accident victims are being ill-served by Ontario’s auto insurance system

Darcy Merkur is a partner at Thomson Rogers in Toronto practicing plaintiff’s personal injury litigation, including plaintiff’s motor vehicle litigation. He has been certified as a specialist in Civil Litigation by the Law Society of Upper Canada.

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