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The fine print in your car insurance policy (Ontario)

If you drive a car in Ontario, every year or so, your car insurance needs to get renewed. Come renewal time, your premiums may go up, they may go down, or just stay the same.

Ontario drivers need to purchase insurance in order to drive. This is a requirement under the Compulsory Automobile Insurance Act R.S.O., 1990 c. C. 25: which states:

Compulsory automobile insurance

2. (1) Subject to the regulations, no owner or lessee of a motor vehicle shall,

(a) operate the motor vehicle; or

(b) cause or permit the motor vehicle to be operated,

on a highway unless the motor vehicle is insured under a contract of automobile insurance.

In plain English, if you drive a vehicle; that vehicle needs to be insured. That means that you, or somebody else needs to pay money to an insurer to have that vehicle insured.

You see a lot of advertising from insurance companies on TV, the internet, at hockey games, even on billboards on our roads. There’s that Knight Mascot from Belair Direct. The “under five minutes” to start your claim schtick from Intact. State Farm has ads which feature different celebrities. They’re all fighting for you business as a consumer of insurance (car, home or otherwise).

But as consumers, insurance is one of the few products which in general, consumers don’t really understand. This is not like buying a pair of shoes or a loaf of bread. Have you ever read the fine print contained in those lengthy policies of insurance? Probably not. It’s all in legalese. Even the personal injury lawyers, insurers and judges don’t get it right sometimes!

Even more remarkable is that the majority of insurance consumers purchase these products without knowing what benefits come with the product. All people care about is the bottom line. How much will their insurance cost? They don’t bother asking the question; what benefits am I entitled to receive from this insurance product in the event of a car collision? How will my insurance protect me in the event of a serious car accident?

None of these questions are asked, or even thought of until it’s too late.

As a personal injury lawyer in Ontario, I can tell you that today in 2017, you are likely paying MORE MONEY for your insurance, but entitled to less benefits.

Accident benefits have been reduced by over 50% when you take in to consideration the cuts to catastrophic benefits from $2,000,000 down to $1,000,000; along with the introduction of the Minor Injury Guidelines which saw benefits slashed from $100,000 for medical/rehabilitative benefits under a standard car insurance claim, down to just $3,500 to a claim which has been put in to the Minor Injury Guideline.0001r_Goldfinger-200x300

There was a protest at Queen’s Park in Toronto on around June 3, 2015 to rally against the Government Supported CUTS to car insurance benefits in Ontario. But after the protest, little was done. The scales have been tipped more and more in favour of deep pocketed insurers against innocent accident victims, their families and loved ones.

The cold, hard, truth is that this Government knows that Ontario consumers don’t care about how much they may be entitled to in benefits through their car insurance policies. Drivers want to drive with bare bones coverage because they believe that accidents will never happen to them. Bare bones coverage should be cheap. And cheap is what the people want. The government is more than happy to give the people what they want in order to get re-elected.

When those cuts come at the expense of your civil liberties, people take a pause and think:

  • Did you know that you can no longer SUE YOUR OWN INSURANCE COMPANY OVER DENIED ACCIDENT BENEFITS!?!?!? That civil liberty has been stripped from you.
  • Did you know that there is a deductible of $36,920 for all pain and suffering claims which arise from a car accident?!?!?!
  • Did you know that the aforementioned deductible increases every year with inflation?
  • Did you know that if a Judge awards you $30,000 for your pain and suffering award; after the deductible is applied you get ZERO; even if the accident wasn’t your fault?
  • Did you know that the application of the deductible CANNOT BE MENTIONED to the JURY in your car accident case? If a lawyer or a party to the action mentions the deductible, then the Judge can declare a mistrial
  • Did you know that in order to win your case for pain and suffering after a car accident claim, your injuries need to meet a medico-legal test? Those injuries need to be viewed by a Judge and Jury as a serious and permanent impairment of an important bodily function. Even if the car accident is NOT your fault, if your injuries do not meet this medico-legal test, you get ZERO for your claim.
  • Did you know that all of these tests did NOT exist in the 1970’s? Car accidents weren’t rocket science back then. But today in 2017 Ontario, suing for a car accident has become akin to rocket science.

I have chatted with my local MPP about these dramatic changes which Ontario Car Insurance has gone through over the years. They don’t seem to care. They only thing which they care about is getting car insurance premiums as low as possible. In my informal tests, I have yet to meet a person who is paying LESS, but getting the same coverage as they were years ago. Instead, I hear more people who are paying MORE for car insurance, but getting less in benefits after they or their personal injury lawyer reads the fine print.

Quick legal tip: Call your car insurer. Find out what your car insurance coverage is, and what other additional benefits may be available to you. You will likely be surprise at how little it costs to add an extra million dollars in liability coverage to your policy. If you are paying under $10 for an extra million dollars in coverage, that’s a worthwhile purchase to make. Addition additional coverage for income replacement benefits, to reduce that nasty tort deductible, and to pump up the med/rehab benefit coverage are also very wise investments to make. But few people think about doing this sort of thing until it’s too late. And if you have to rely on those bare bone policies, you may be in for a shock at how little coverage you’re afforded.

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