Articles Posted in Income Replacement Benefits

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The purpose of this instalment of the Toronto Injury Lawyer Blog is not about settling a personal injury case fast.

Rather, it’s about what money can be claimed, and recovered relatively quickly, after an innocent accident victim cannot return to work and earn an income after a serious accident.

Getting paid benefits quickly to supplement one’s lost income, because one cannot work after a serious accident is a very common concern for clients. Legitimately so. A Plaintiff goes from earning a gainful income one day; to being disabled and unable to do so the next.  The bill collectors don’t care that you’ve been involved in a serious accident. All that they care about is that their bills get paid.

It’s our hope that this instalment of the Toronto Injury Lawyer Blog gives you some insight on sources to claim benefits in order to make ends meet.

Before we examine those sources, here are a few practical tips to claiming benefits:

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If you have been hurt or injured in a car accident in Ontario, you may be entitled to an income replacement benefit of up to $400/week (or more if you paid an additional insurance premium to increase your IRB level).

$400/week isn’t very much money. But before you complain, all Ontario drivers are eligible to purchase optional benefits to increase the IRB level. Unfortunately, very few Ontario motorists opt to purchase this coverage because it tacks more money on to their existing premium. Let’s be honest, the majority of people are simply looking for the cheapest rates around, without giving much thought to what they are, or aren’t covered for and regardless of the ultimate benefit which is paid out.

If I told you that you could increase your liability coverage from $1,000,000 to $2,000,000 per year by paying an extra $20/year, would you take it? Sounds like a pretty good deal right? Paying just $20/year for an extra $1,000,000 in coverage. This is one of the best bangs for the buck on the car insurance market, but few people opt for this additional coverage benefit. The cheapest coverage is the default coverage of choice for the majority of Ontario drivers.

When you think of the term income replacement benefits, it would lead you to believe that the benefit will replace your entire income for the period you’re too injured to work following a car accident. NOT TRUE.

The term income replacement benefit is somewhat misleading, as it doesn’t entirely replace your income, and it’s not as automatic as the term “benefit” would lead you to believe.

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If you are hurt or injured in a car accident in Ontario, you will be entitled to an array of accident benefits.

These accident benefits are paid by your own car insurer, regardless of fault. If you did not have car insurance at the time of the car accident, the order of who pays for those accident benefits is determined based on a set of priority rules as defined under the Insurance Act and the Statutory Accident Benefits Schedule (“SABS”). This is often why you see insurance companies fighting not against a Plaintiff, but against each other in an attempt to “pass the buck” so to say to determine who is responsible for paying an injured accident victim’s accident benefits. Because the truth is insurance companies would rather not pay if they don’t have to. Can you blame them?

Speaking of passing the buck, one of the benefits which an injured accident victim may be eligible for is called the income replacement benefit or IRB.

The income replacement benefit is only available to income earners. If you were not earning an income at the time of the accident, or not employed but either worked 26 off the 52 weeks for the accident, you will not be entitled to the income replacement benefit. Self employed people are considered employed and working. But, recovering the income replacement benefit for self employed plaintiff’s can be very difficult. Establishing an income in a cash business, or in a business with limited record keeping makes it hard for insurers and their accountants to verify that you were working and entitled to the income replacement benefit. If they can establish that you are entitled to the income replacement benefit, quantifying that benefit can be very tricky. The reality is that self employed people often don’t show or report the entirety of their income because they don’t want to pay as much in tax. The problem with that is that you can only recover what you report to Revenue Canada. Your income replacement benefit is based on reportable income. The income replacement benefit is NOT based on unreported income, or moneys which are kept off the books. You can’t have it both ways. Continue reading →

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There are a lot of different OCF Claims forms to complete after you’ve been involved in a car accident in Ontario. In this “How to” series, the Toronto Personal Injury Lawyer Blog examines how to complete the OCF-2 Employer’s Confirmation of Income Form. In order to recover income replacement benefits, it’s necessary to have the OCF-2 form completed and submitted to the insurer as soon as possible following a car accident. Failure to have the OCF-2 Employer’s Confirmation of Income Form completed properly and in a timely manner may result in a denial or delay on the recovery of income replacement benefits.

For starters, you need to get a copy of the OCF-2 Employer’s Confirmation of Income For. This can be found on the FSCO Wesbite; the Goldfinger Injury Lawyers Website; through your lawyer, or even through your own insurance company. NOTE: If you wait for the form to arrive in the mail form your own insurance company, it may get lost in the mail or simply delayed. Just print off a form online if you have the resources to do so. You can even go to your local library, find the form online and have it printed right there on the spot for the charge of printing just two pages. The last time I was at my local public library, there was a charge of .25c/page, along with FREE internet access. This is very reasonable.

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A number of our clients ask our lawyers whether or not they should try returning to work after they’ve been denied Long Term Disability Benefits, denied Income Replacement Benefits, denied CPP Disability Benefits, or are simply recovering from a serious injury caused by an accident; car, motorcycle, fall, or otherwise.

Let’s first paint a clear picture.

You’ve been hurt or injured in a serious car accident. Or, you have a medical condition (psychological, physical or otherwise) which is preventing you from returning to work.

Your doctors tell you that it’s not safe for you to work, and that you should take time off.

Your application for Long Term Disability Benefits, Income Replacement Benefits, or CPP Disability Benefits has been denied.

Your savings have been run dry. You’re borrowing money from friends and family members. You’re cashing out on your RRSP’s and other retirement savings in order to make ends meet. Your visa and credit are maxed out to the limit and those interest payments are accumulating. To say that you’re having financial difficulty is an understatement.

What do you do in this situation?

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Almost every client who enters my law firm has the same idea after they’ve been injured in an accident:

I ‘ve been paying my car insurance premiums for years and years; now that I’ve been hurt; it’s now the insurance company’s turn to play their part and start paying me benefits“.

In a perfect world, this is exactly how insurance would work. You pay premiums; and when you need it most, the insurance company pays you benefits. But the world is far from perfect. That’s why we have lawyers…

What exactly are those so called “benefits” and how do they work?

The term “benefits” is so loose and broad. What people have in mind for benefits is greatly different than what those benefits are.

The first benefit which may come to mind is a benefit which replaces your income if you can’t return to work on account of a serious injury.

Under the SABS/Insurance Act, this is called an income replacement benefit or IRB.

It’s a common misconception that the IRB covers 100% of your wages. It doesn’t. It also doesn’t kick in until 7 days after the accident. And just because you’ve been involved in a car accident, doesn’t automatically entitle you to an income replacement benefit. There are a variety of medico-legal tests which need to be met. In addition, you need to prove with real concrete evidence that you were gainfully employed in the 52 weeks prior to the accident and earning an income (not unreported cash income).

Helping accident victims understand exactly how the income replacement benefit works is not an easy task for a variety of reasons. But, this Toronto Injury Lawyer Blog post will do its best to de-mystify the IRB.

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