We often receive questions from our clients about accident benefit coverage through their auto insurance policy. We'd like to help you gain a deeper understanding of your auto insurance coverage, and decide if you'll need to increase your accident benefits.
Accident Benefits And Auto Insurance
Accident benefits are a key component of Ontario car insurance coverage. No driver wants to get injured in an auto accident. If it happens though, accident benefits will help to pay for healthcare and other expenses as you recover.
What exactly are Accident Benefits?
Accident benefits provide compensation if you or others are hurt or killed in an auto accident. They include coverage for passengers and pedestrians involved in the accident.
Ontario uses a no-fault insurance system. This means that being at fault doesn’t have an impact on whether the coverage is applicable.
Accident Benefits Explained By the Financial Services Regulatory Authority of Ontario (FSRA)
FSRA provides this accident benefits definition:
“This section of your automobile insurance policy provides you with benefits if you are injured in an automobile accident, regardless of who caused the accident, including supplementary medical, rehabilitation and attendant care, caregiver, non-earner and income replacement benefits. Options exist to increase most of these coverages.”
What’s Covered By Accident Benefits?
The Statutory Accident Benefits Schedule (SABS) document outlines what is covered under the accident benefits portion of your auto insurance policy. It is applicable to all basic automobile policies. It outlines the mandatory and optional accident benefits and coverage limits for medical care, income replacement, death benefits, funeral expenses, and loss of income from disability.
Accident benefits are compulsory in Ontario. All insurance policies must include accident benefits as part of mandatory coverage.
What Are the Standard Accident Benefits In Ontario?
- Income replacement for persons who have lost income – The standard level of income replacement provided in a policy is based on 70% of your gross weekly income, up to a maximum of $400 per week.
- Payments to non-earners who are unable to carry on a normal life – you can receive coverage of up to $65,000 for non-catastrophic injuries or up to $1 million for catastrophic injuries.
- Payment of care expenses - persons who cannot continue to act as a primary caregiver for a member of their household, can receive coverage for their care.
- Payment of medical, rehabilitation and attendant care expenses – medical and rehabilitation benefits include physiotherapy, prescriptions, chiropractic, counseling, and other services not covered by OHIP or through your group insurance plan (if applicable). Medical care and costs that qualify are listed in the statutory accident benefits schedule. If needed, you will be provided with assistance at your home or healthcare facility to help you recover from a serious auto accident injury. The standard benefit pays up to $50,000 for medical and rehabilitation expenses, with a 10-year limit in most cases, and up to $36,000 for attendant care expenses.
- Payment of funeral expenses and payments to survivors of a person who is killed – The standard funeral expense benefit is a maximum of $6,000. The standard level of death benefits paid to the surviving spouse and dependant of a person who is killed is $25,000 to surviving spouse and $10,000 to surviving dependant(s).
What Are Optional Accident Benefits In Ontario?
You have the option to increase coverage limits for income replacement, medical care, caregiver benefits, death and funeral benefits, and other accident benefits.
The optional benefits your insurance company must offer you are:
- Increased income replacement – the standard level of income replacement may be increased by purchasing optional coverage, bringing the weekly limit up to $600, $800, or $1,000.
- Caregiver, housekeeping, and home maintenance expenses – you may purchase an optional benefit to provide this coverage for all impairments (including non-catastrophically impaired). You can purchase an optional benefit to provide up to $100 per week for reasonable expenses to help with housekeeping and maintaining your home while you recover.
- Increased medical, rehabilitation, and attendant care – you can purchase an optional medical and rehabilitation benefit of $100,000, an optional attendant care benefit of $72,000, or an optional medical, rehabilitation, and attendant care benefit of $1,100,000 for medical and rehabilitation expenses and $1,072,000 for attendant care expenses. You have the option to increase coverage for non-catastrophic injuries to $130,000 and increase coverage for catastrophic injuries to $2 million.
- Increased death and funeral coverage – The standard benefit may be doubled by purchasing optional coverage. This coverage increases the standard funeral expense benefit from $6,000 to $8,000. You have the option to increase benefits up to $50,000 for your spouse, and $20,000 to dependents.
- Dependent care – There is no standard dependent care benefit for persons who are employed and care for dependents. You may purchase an optional benefit to receive weekly dependent care expenses of $75 for the first dependant, and $25 for each additional dependant, up to $150 per week. This can only be claimed if you were employed at the time of the accident and have to pay for additional childcare expenses due to injuries sustained from an accident.
- Indexation benefit – This optional coverage will ensure that certain weekly benefit payments and monetary limits will be adjusted on an annual basis to reflect changes in the cost of living.
Additional expenses may also be covered as part of your accident benefits coverage. They include:
- Lost educational expenses - compensation for lost tuition, books and other education-related expenses up to $15,000.
- Expenses of visitors - reasonable expenses incurred by family and friends who visit you during recovery and treatments. Your spouse, children, grandchildren, parents, grandparents, siblings, certain other dependants, and guardians qualify.
- Damage to personal belongings - receive compensation for damaged clothing, eyeglasses and other personal medical devices damaged as a result of the accident.
- Cost of examinations - compensation for the cost of examinations related to treatments as part of your recovery from an accident.
What Are Accident Benefits For A Passenger?
All passengers involved in an auto accident are eligible for accident benefits. Regardless of the type of accident or who was at fault, you will almost always be covered by insurance. Injured passengers are required to file a car insurance claim against the driver’s coverage. Each situation will dictate what claim you submit.
How Do You Settle An Accident Benefits Claim?
There will come a time after an accident where you will be approached by your insurer to settle your accident benefits claim. In Ontario you must wait one year before settling your accident benefits claim.
Your insurer will propose a fixed amount to settle and close your claim. Once you agree to an accident benefits settlement, you cannot request additional compensation from your insurer.
How much you settle for can affect litigation for tort claims against an at fault driver if you are pursuing legal action. Always assess your situation before settling. Discuss your options with a lawyer or your insurance broker. It’s important to understand your options and how much you are entitled to prior to making any settlement decision.
Automobile Accident Insurance Benefits and Regulations In Other Provinces
Accident benefits are included in minimum insurance coverage requirements in all provinces with the exception of Newfoundland. Coverage limits for medical payments, replacement income, death benefits, funeral costs, and the ability to sue varies from province to province.