Will The Proposed Changes To Automobile Insurance Laws Lower Our Insurance Premiums? Likely Not.
The Ontario Government has made major changes to automobile insurance laws every six to eight years, often with the stated objective of lowering consumers’ car insurance premiums. However, a closer look at these legislative changes shows that while they tend to save insurance companies millions of dollars, they do not result in savings for the average Ontario driver, whose insurance premiums continue to rise. In fact, these changes can significantly impact those involved in motor vehicle accidents, complicating the claims process and potentially limiting the compensation available for injuries sustained in these incidents. Understanding your rights after a motor vehicle accident is crucial, as it ensures you receive the appropriate support and compensation you deserve.
Let’s look at the most recent example of these changes. In 2016, the Wynne Government changed our automobile insurance laws in two significant ways: first, it made it much more difficult for seriously injured people to qualify for what is called a “catastrophic impairment,”¹ and second, it cut the medical-rehabilitation and attendant care benefits available to catastrophically impaired people by half: from $2,000,000.00 to $1,000,000.00. In the eight years since these changes, we can say with confidence that while insurance companies saved millions of dollars on catastrophic claims, the consumer’s car insurance premiums never went down.
Fast forward to 2024, we know from the Budget that was released earlier in March that the Ford Government is also embarking on legislative changes to automobile insurance laws. One such proposed change is to make some mandatory benefits (such as income replacement benefits) optional. And like its predecessor, the Ford Government is promising to lower our insurance premiums.
While it remains to be seen whether these changes will lower our insurance premiums, if the past is any indication, they will only tend to save the insurance companies money while leaving the average consumer with less protection and higher premiums.
Catastrophic Injuries and the Right to Sue
Catastrophic injuries, including brain injuries, paralysis or amputations, often have life-altering repercussions that require ongoing medical attention and extensive rehabilitation services. If this occurs to you in Ontario, if it involves someone other than yourself, you may have recourse to sue them beyond their insurance policy coverage for compensation related to pain and suffering or future care costs.
However, your insurance policy and premium payments play a large part in determining the scope of a lawsuit. Ontario operates under a no-fault system wherein each driver’s insurance provider covers their own policyholder losses for critical benefits to help you get back on your feet or to compensate you for an inability to work, regardless of who caused an accident. This system speeds up claims processing while decreasing lawsuits but can limit your claim unless injuries exceed certain legal thresholds.
When selecting an insurance plan, the decision boils down to striking a balance between premium costs and coverage limits. Basic Ontario policies offer statutory accident benefits like medical coverage and rehabilitation assistance as well as income replacement services; however, these have certain caps, and exceeding them could limit your ability to claim more from insurers. Higher premiums tend to correlate with policies with increased coverage limits and payouts for catastrophic injuries, which means your out-of-pocket expenses might be reduced, lessening the need to sue for additional compensation. Conversely, lower premiums often mean reduced coverage and an increase in likelihood that additional legal action might be necessary.
Ontario law sets strict thresholds on when someone can sue for pain and suffering caused by a car accident. These thresholds aim to prevent minor injury claims from overwhelming the legal system and driving up insurance costs for everyone; however, for catastrophic injuries, these thresholds can often be met more easily, making it possible to pursue significant damages claims beyond a claim for accident benefits.
Even if you are technically at fault, our accident benefit specialists can help. Formerly employed in the insurance industry, our specialists have the insight and experience needed to secure statutory accident benefits for injury victims.
We work hard to secure the settlement you deserve and will not collect legal fees unless your motor vehicle accident claim is successful.
¹Some examples of “catastrophic impairments” include: spinal cord injuries such as paraplegia and quadriplegia, significant brain injuries, severe psychiatric injuries as well as severe orthopedic injuries that result in 55% (or more) impairment of the whole body.
About the Authors
Ben enjoys the complexities of personal injury litigation and finds the cases that require creative thinking the most gratifying. His practice is exclusively devoted to representing clients with brain injuries, spinal cord injuries, and severe orthopaedic injuries.