EXPLANATION OF AUTOMOBILE INSURANCE

 

Liability—provides coverage for any insured person in the event that someone else is injured or killed or suffers property damage as a result of an incident involving your vehicle.  It will defend you or pay on your behalf legitimate claims made against an insured person up to the limit of your coverage and the cost of settling claims.

 

Accident Benefits—Your insurance company is obligated to explain details of Accident Benefits coverage to you.  This coverage provides benefits that an insured person is entitled to receive if injured or killed in an automobile accident.  These benefits include: income replacement for persons who have lost income; payments to non-earners who suffer complete inability to carry on a normal life; payment of care expenses to persons who cannot continue to act as a primary caregiver for a member of their household; payment of medical, rehabilitation and attendant care expenses; payment of certain other expenses; payment of funeral expenses and payments to survivors of a person who is killed.  You may also purchase additional optional benefits to increase the standard level of benefits provided in this policy.  The optional benefits your insurance company must offer are: increased income replacement; caregiver, housekeeping and home maintenance; increased medical and rehabilitation; increased attendant care; increased medical and rehabilitation; and attendant care; increased death and funeral expenses; dependant care and an indexed benefit.

 

 

Coverage

Coverage Under Standard Auto Policy

Options Available to Increase your Benefits

Medical, Rehabilitation & Attendant Care Benefit—for non-catastrophic injuries

$50,000 for medical and rehabilitation benefits, including assessment costs;

$36,000 for attendant care benefits

$100,000 or $1,100,000 for medical and rehabilitation benefits, including assessment costs;

$72,000 or $1,072,000 for attendant care benefits

Medical, Rehabilitation & Attendant Care Benefit—for catastrophic injuries

$1,000,000 for medical and rehabilitation benefits, including assessment costs;

$1,000,000 for attendant care benefits

An additional $1,000,000 for medical and rehabilitation benefits, including assessment costs;

 

Caregiver Benefit

Up to $250 per week for the first dependent plus $50 for each additional dependant; available only for catastrophic injuries

Up to $250 per week for the first dependent plus $50 for each additional dependant; available for all injuries

Housekeeping& Home Maintenance Expenses Benefit

Up to $100 per week, available for only catastrophic injuries

Up to $100 per week, available for all injuries

 

 

 

 

Coverage

Coverage Under Standard Auto Policy

Options Available to increase your benefits

Income Replacement Benefit

70% of gross income up to $400 per week

Weekly limit can be increased to $600, $800 or $1,000 per week

Dependant Care Benefit

Not Provided

Up to $75 per week for the first dependant and $25 per week for each additional dependant to a maximum of $150 per week

Death & Funeral Benefits

$25,000 lump sum to an eligible spouse; $10,000 lump sum to each dependant; maximum $6,000 funeral benefits

$50,000 lump sum to an eligible spouse; $20,000 lump sum to each dependant; maximum $8,000 funeral benefits

Indexation Benefit—applicable to income replacement benefit, non-earner benefit, caregiver benefit, attendant care benefit or medical and rehabilitation benefit

Not Provided

Annual adjustment according to the Consumer Price Index for Canada

 

Accident Benefits Definitions:

 

Medical and Rehabilitation Benefit:  Covers the cost of reasonable and necessary medical and rehabilitation expenses (eg. physiotherapy, prescriptions) that are not covered by OHIP or your disability insurance plan

 

Attendant Care Benefit:  Pays for an aide or attendant to look after you if you have been seriously injured in an accident

 

Catastrophic Injury:  If you suffer an injury in an auto accident, you can apply for a determination of whether your injury qualifies as “catastrophic” (eg. loss of limb, paraplegia).  If the injury qualifies as catastrophic you are eligible for an increased level of benefits.

 

Caregiver Benefit:  If you are providing full time care to dependants and can no longer provide that care as the result of an auto accident, you may be eligible for caregiver benefits to reimburse you for your expenses to hire someone to care for your dependants.

 

Housekeeping and Home Maintenance Expenses:  If you are unable to perform your usual duties due to your injuries, this benefit pays for reasonable and necessary additional expenses for someone to complete your usual duties.

 

Income replacement Benefit:  if you cannot work as the result of an auto accident, you may be eligible for basic weekly income replacement benefits.   The benefit commences after one week

 

Dependant Care Benefit:  Pays for additional expenses incurred to care for your dependants, if you are employed and injured in an auto accident.

 

Death & Funeral Benefit:  If an insured dies as a result of an auto accident, the Death Benefit provides a lump sum payout to the spouse and dependant(s); the Funeral Benefit provides a lump sum payout to cover the cost of the funeral expenses

 

Indexation Benefit:  the automatic adjustment of the income replacement benefit, non-earner benefit, attendant care benefit or medical and rehabilitation benefit according to the Consumer Price Index for Canada to compensate for inflation.

 

Uninsured Automobile—Provides coverage if an insured person is injured or killed by an uninsured motorist or by a hit and run driver.  It covers damage to your vehicle and its contents caused by an identified uninsured motorist, subject to a deductible.

Direct Compensation—Property Damage—Provides coverage in Ontario under certain conditions, for damage to your vehicle and to property it is carrying, when another motorist is responsible(at fault).  It is called Direct compensation because you will collect from your own insurance company, even though you are not at fault for the accident.  BSMW always applies $0 deductible to this coverage.

Loss or Physical Damage—Provides a selection of optional coverages for your own vehicle.  Payments cover direct and accidental loss of or damage to, a described vehicle and its equipment.  There is usually a deductible amount indicated for each coverage and this amount is either paid by you toward the cost of repairs or deducted from the loss settlement.  Higher deductibles can reduce our premiums.  There are four (4) types of coverage:

Specified Perils:  Covers the described vehicle against loss or damage caused by certain specific perils—fire, theft or attempted theft, lightning, windstorm, hail or rising water, earthquake, explosion, riot or civil disturbance, falling or forced landing of aircraft or parts of aircraft, or the stranding, sinking, burning derailment or collision of any kind of transport in or upon which the described vehicle is being transported.

 

Comprehensive:  Covers a described vehicle against loss or damage other than those covered by collision or upset, including perils listed under Specified Perils, falling or flying objects, missiles and vandalism.

Collision or Upset:  Covers damage when a described vehicle is involved in a collision with another vehicle; or with a stationary object; or the vehicle is overturned during an accident.

All Perils:  This coverage combines the Collision and Upset and Comprehensive coverages with the added benefit or allowing coverage in the event a vehicle is stolen by a family member and becomes involved in an accident.

OPCF 44R (Family Endorsement): Covers an insured for the difference between the at-fault driver’s Third Party Liability  limit and their own Third Party Liability limit if someone with less liability coverage than the insured injures them in an accident………Third Party Liability is defined as claims made by a driver against another driver who causes an accident.

Tort Deductible:  this is the amount that is deducted from a settlement or court award for pain and suffering….the standard deductible is $30,000 for compensation related to pain and suffering but this can be reduced to $20,000 if you so desire…..the standard deductible for Family Law Act claims is $15,000 but this can be reduced to $10,000.

Finally, in 2010 the government introduced reforms the intent of which was to lay the foundation for an auto insurance system with greater price stability and more protection for you, the consumer.  Several of the key changes include:

 

  1. Many injuries received in auto accidents are minor and thus if you sustain a minor injury in a n auto accident the maximum medical and rehabilitation benefit has been limited to $3,500 regardless of the coverage level you have selected.

 

  1. Accidents where you are deemed to be 25% or less at-fault will no longer affect your premium

 

  1. If your auto has been damaged or written off after an accident and you do not agree with the value you have been offered or your degree of fault for the accident, you can choose the appraisal process outlined in the Ontario Auto Policy to settle the dispute, and the insurance company MUST AGREE to participate.

 

  1. The deductible that is applied to court awards for fatal accidents has been eliminated. 

 

The Insurance Act of Ontario provides that where (a) an applicant for a contract (i) gives false particulars of the described automobile to be insured to the prejudice of the Insurer, or (ii) knowingly misrepresents or fails to disclose in the application any fact required to be stated therein; or (b) the Insured contravenes a term of the contract or commits a fraud; or (c) the Insured willfully makes a false statement in respect of a claim under the contract, a claim by the Insured, for other than such statutory accident benefits as are set out in the Statutory Accident Benefits schedule, is invalid and the right of the Insured to recover indemnity is forfeited