The Government of Ontario is working towards making insurance premiums more affordable. As of June 1st, 2016 there are changes being made to automobile benefits and coverages in your standard auto insurance policy. Some of the coverages in your policy have been reduced, and some options for increased coverage have been eliminated or changed.
Keep in mind that these changes are taking place on June 1st 2016, so if you are renewing your standard auto policy on or after June 1st 2016, it will automatically include these coverage changes. You can speak with your broker and purchase optional endorsements to suit your needs.
All auto insurance policies will continue to include the following coverages:
• Third Party Liability
• Uninsured Automobile
• Direct Compensation-Property Damage
• Accident Benefits
Please see the charts below to be clear on the upcoming changes.
|Benefit||Current Policy||New Policy||You can choose|
|Medical and Rehabilitation for non-catastrophic injuries||$50,000||
These benefits have been combined and reduced to $65,000 total
Increase the benefit to $130,000 total
|Attendant Care for non-catastrophic injuries||$36,000|
|Medical and Rehabilitation for catastrophic injuries||$1,000,000||
These benefits have been combined and reduced to $1,000,000 total
An additional $1,000,000
for a total of $2,000,000 for catastrophic injuries
|Attendant Care for catastrophic injuries||$1,000,000|
|Medical, Rehabilitation and Attendant Care, all injuries||Not applicable||
|Increase the combined non-catastrophic benefit to $1,000,000 and the combined catastrophic benefit total to $2,000,000|
Other Optional Benefits
There are many other options available to purchase additional or increased benefits and coverages. The following chart lists some and indicates if those options will change on June 1st.
|Benefit/Coverage||Current Policy||New Policy||You can choose|
|Income Replacement benefit||70 per cent of gross income up to $400 per week.||No change||To increase the weekly limit to $600, $800 or $1,000 per week.|
|Caregiver benefit||Available only for catastrophic injuries: Up to $250 per week for the first dependant plus $50 for each additional dependant.||No change||To make the same amounts available in current policy for catastrophic injuries available for all injuries.|
|Housekeeping and Home Maintenance expenses||Available only for catastrophic injuries: Up to $100 per week.||No change||To make the same amounts available in current policy for catastrophic injuries available for all injuries.|
|Death and Funeral benefits||$25,000 lump sum to an eligible spouse; $10,000 lump sum to each dependant; maximum $6,000 funeral benefits.||No change||$50,000 lump sum to an eligible spouse; $20,000 lump sum to each dependant; maximum $8,000 funeral benefits.|
|Dependant Care benefit||Not provided||Not provided||To purchase this benefit and add up to $75 per week for the first dependant and $25 per week for each additional dependant to a maximum of $150 per week.|
|Indexation benefit||Not provided||Not provided||To add an annual adjustment for inflation for many benefits according to the Consumer Price Index for Canada to your policy.|
|Third Party Liability||$200,000 minimum for claims as a result of lawsuits against you.||No change||Options exist to increase the minimum amount.|
|Tort Deductible||$36,905.40 deductible for court awarded compensation for pain and suffering (Jan 1-Dec 31, 2016).||No change||Reduce deductible by $10,000 regardless of annual indexation percentage increases.|
There are more key changes listed and explained below. These changes will take effect on June 1st, 2016.
Insurers can no longer use minor at-fault accidents to increase your premiums as long as the accident fits into the below criteria.
– The minor accident occurs on or after June 1, 2016.
– No payment has been made by an insurer.
– There were no injuries.
– Damages to each car and property were less than $2,000 per car and were paid by the at-fault driver.
– This arrangement is limited to one minor accident every three years.
Interest Rate for Monthly Payment Plans
The maximum interest rate that insurers can charge on your monthly premium payments has been lowered from 3% to 1.3% for one year policies, with correlating reductions for shorter terms.
The standard deductible for comprehensive coverage has been increased from $300 to $500.
Previously there was a six-month waiting period for people who aren’t working to receive benefits. This has been reduced to four weeks. Those benefits can now only be received for up to two years after the accident.
Duration of Medical, Rehabilitation and Attendant Care benefits
The amount of time you can receive this standard benefit is now five years for non-catastrophic injuries. It will be paid only as long as you remain medically eligible. Children are excluded from this change.
Speak to your broker or call us at 416-237-0436, we’re happy to answer any of your questions.
“Important Changes to Auto Insurance.” Financial Services Commission of Ontario. Queen’s Printer for Ontario, 24 Feb. 2016. Web. 10 Mar. 2016.