Changes to Statutory Accident Benefits

In an effort to reduce insurance premiums, the Government has promised to make significant changes to statutory accident benefits.

The changes include:

  1. An amendment to the test for catastrophic impairment;
  2. Including attendant care services with the $1 million medical and rehabilitation benefit for catastrophic impairments;
  3. Reducing the standard duration of medical and rehabilitation benefits from 10 years to five years for all claimants except children; and,
  4. Eliminating the six month waiting period for non-earner benefits, and limiting the duration of non earner benefits to two years post accident ;

Tort claims

In addition to the above Statutory Accident Benefit changes, the Government has indicated that it will propose amendments to the Insurance Act, these amendments are as follows:

  1. An adjustment to the deductible on awards for pain and suffering damages to reflect inflation and future changes in inflation;
  2. An adjustment to the monetary thresholds beyond which the tort deductible does not apply to reflect inflation.

These changes will serve to increase the $30,000.00 deductible introduced in 2003.

The full list of proposed changes to both SABS and Tort Claims can be found at http://www.fin.gov.on.ca/en/budget/ontariobudgets/2015/papers_all.pdf.

With the amounts available to victims of motor vehicle accidents set to be dramatically reduced, it is important to ensure that those involved in accidents receive the full amount they are entitled to. A lawyer familiar with the legislation can help you make sure you receive your entitlement.

If you have been injured in a motor vehicle accident, please feel free to contact a member of the Mann Lawyers personal injury team at 613 722 1500.

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Recent Cost Award against Unsuccessful Plaintiff

Mrs. Berg was ordered to pay $40,000 to Zehrs after unsuccessfully suing them.

Mrs. Berg was ordered to pay $40,000 to Zehrs after unsuccessfully suing them.

A recent case out of the Ontario Superior Court highlights the risk that plaintiffs face if they are unsuccessful in their claim for damages.

In the case of Berg v. Loblaw Properties Limited, 2013 ONSC 4803, Mrs. Berg sustained serious injuries when she fell at a Zehrs store in Woodstock, Ontario.  She brought suit against the store and so too did her daughter, Ms. McDonald, who provided her mother with care while she was recuperating from her injuries.

After a four week trial, the jury determined that the store was not liable for Mrs. Berg’s injuries.  The defendant store submitted a cost outline claiming that it should be reimbursed for the legal fees it incurred in the amount of $140,351.65.  In doing so, the defendant relied on a fundamental principle of civil litigation: that a successful party is entitled to be at least partly indemnified for its costs.

In the end the court awarded the defendants the sum of $40,000 in costs against Mrs. Berg.  The court made two pronouncements of particular interest.  Firstly, the court stated that costs should not be routinely ordered against a Family Law Act claimant such as Ms. McDonald.  Secondly, the court stated that while impecuniousity (inability to pay) would not preclude a court from making a cost award it is nevertheless a factor that a court will usually consider when deciding the issue of costs, particularly where a cost award may inflict severe financial hardship on a party.

Motor Vehicle Accidents in Ontario

Ontario has a two-pronged system for compensating people who are injured in motor vehicle accidents.  It is a mixed fault/no-fault system.  The no-fault component is referred to as the Accident Benefits claim.  The fault component is referred to as the Tort claim.

A tort claim may be available in cases where the accident is the fault of someone other than the injured party.  Regardless of the issue of fault, any person who is injured in a motor vehicle accident is entitled to put forward a claim for Accident Benefits.

Accident Benefits are prescribed by statute.  Eligibility for these benefits as well as the rules governing payment of these benefits may be found in the Regulations to the Insurance Act.  These benefits are paid by the injured party’s motor vehicle insurer.  In cases where the accident was the fault of someone other than the injured party, the payment of these benefits should not affect the party’s risk assessment and premium level.  In cases where the injured party is not covered by a policy of motor vehicle insurance, the motor vehicle insurer of the party at fault for the accident or the party in whose vehicle the injured party was riding is required to provide the injured party with Accident Benefits.

Accident Benefits have changed over the years.  Recently, substantial changes were made to the level and availability of benefits effective September 1, 2010 (these changes will affect consumers when their current insurance policies are renewed).  These benefits have continuously been paired down over the years by successive governments as a result of the insurance lobby.  The recent amendments enacted by the McGuinty government are intended to give consumers choice.  McGuinty is confident that consumers will inform themselves of the options available and purchase the needed protection.

Accident Benefits include income replacement benefits (up to a maximum of $400 per week), medical and rehabilitation benefits and housekeeping and caregiving assistance (if available).  Of note, people who suffer a whiplash associated disorder (WAD injury) are only entitled to receive a maximum of $3,500.00 in medical and rehabilitation benefits even though it is an accepted medical fact that a significant minority of whiplash injuries result in ongoing chronic pain that gives rise to various levels of ongoing functional impairment or functional limitations.  Under the new Regulation, all cases of whiplash are categorized as “minor injuries”.

For those persons injured in a motor vehicle accident that is the fault of someone else, a tort claim may be available.  The tort system itself is a bit of a mixed bag.

An injured person who suffers or is expected to suffer a pecuniary (financial) loss may sue the party responsible for the accident for the full amount of the loss.  The only exception to this rule applies in the case of medical and rehabilitation costs.  An injured person may only sue for medical and rehabilitation costs if they suffer from ongoing functional impairment that is serious in nature.  The person must have a permanent and serious impairment of an important physical, mental or psychological function.

An injured person may not sue the party responsible for the accident for non-pecuniary loss (loss of enjoyment of life, pain and suffering) unless the person has sustained a permanent and serious impairment.  Assuming this threshold has been reached, two other factors must be considered.  Firstly, the Insurance Act provides that an insurer is not liable to pay the first $30,000 in damages awarded for loss of enjoyment of life and pain and suffering unless the award equals or exceeds $100,000 in total.  This is commonly referred to as the statutory deductible (coverage can be purchased which reduces this amount to $15,000).  So, if the court assessed an injured person’s damages at $50,000, the insurance company for the tortfeasor (responsible party) would only be liable to pay the injured person the sum of $20,000.  Secondly, in 1978 the Supreme Court of Canada mandated a maximum award of $100,000.  Adjusted for inflation this figure now sits at approximately $325,000.  It is only available for the most serious injuries including paraplegia, quadriplegia and severe brain injury.

Further, the insurer for the tortfeasor is entitled to a credit for any amounts that are paid to the injured person as Accident Benefits.  An injured person who is receiving the maximum income replacement benefit of $1,600 per month may not sue the tortfeasor for the first $1,600 of lost monthly income (rule against double recovery).

In addition, the insurer for the tortfeasor is entitled to a credit for any “collateral benefits” that are paid to the injured person.  An injured person who qualifies for and receives the Canada Pension Plan Disability Benefit must deduct the amount of this benefit from his or her claim against the tortfeasor for loss of income.

Bringing forward a tort claim is akin to taking part in a grueling marathon.  It is frustrating, incredibly time consuming and expensive and physically, emotionally and mentally exhausting.  These claims typically last between two to five years.

If you have been injured in a motor vehicle accident you should consult immediately with a motor vehicle accident lawyer so that you are aware of your legal rights and entitlement to Accident Benefits, as well as to other compensation for your injuries that may be available from the insurer of the tortfeasor or at-fault driver.

Given the very adversarial nature of these claims and the length and complexity of the claims process you want a lawyer who is:

(i)              Flexible;

(ii)            Responsive to your communication and needs;

(iii)           Attentive and a good listener;

(iv)           Knowledgeable;

(v)            Detail oriented;

(vi)           Firm, and tough when necessary; and a

(vii)         Straight-shooter.

Kevin Butler and Jonathan Wright are Ottawa-based lawyers practicing in the areas of Civil Litigation and Personal Injury at Mann & Partners, LLP. The articles on this blog are not intended to provide legal advice. Should you require legal advice, please contact Mann & Partners, LLP at 613-722-1500 or fill out our form to be contacted within 24 hours.