Car Accidents: A Crash Course Part 3 Accident Benefits

It’s National Road Safety Week, which is a great time to take a close look at your car insurance policy and find out what accident benefits are included…and increase your coverage if it’s looking a little light.

To help you make well informed decisions about the kind of coverage is best for you, we’ve put together this primer on accidents benefits in Ontario—what they are, how to apply for them, what “optional” coverage is available…and how much it might cost you.

What are car accident benefits?

If you’re injured in a motor vehicle accident, by law you’re eligible for compensation, including replacement of your income, medical treatment and rehab that’s not covered by OHIP, and coverage of some expenses for personal care. The dollar value of the benefits you’ll receive will vary depending on the severity of your injuries and the insurance coverage you have.

Where do I apply for accident benefits?

Under Ontario’s “no fault” insurance rules, if you’re in an accident and have auto insurance, your application for car accident benefits goes to your own insurance company—even if someone else caused the crash. If you’re the guilty party, you’re still eligible for benefits from your insurance company—unless you broke the law, which may limit the benefits you can get. If you’re a passenger, pedestrian or cyclist injured in an accident and you don’t have auto insurance, your application for car accident benefits will go to the driver’s insurance company. And if they don’t have insurance—yikes—you can apply to the Motor Vehicle Accident Claims Fund.

What’s the minor injury guideline?

As part of insurance changes in 2010, the government created a “minor injury guideline” that includes sprains, strains, contusions, abrasions, lacerations, subluxations and “whiplash associated disorders.” If your injuries fall under the minor injury guideline, your medical and rehab benefits will be capped at $3,500, unless you’ve got a provable pre-existing condition and, as a result, need additional medical or rehab treatment to make a full recovery. Many people who’ve been in car accidents will tell you that so-called minor injuries may need major rehab—and $3,500 doesn’t go very far. Unfortunately any additional coverage for medical or rehab benefits you’ve purchased through your auto insurance won’t do you any good if your injuries are considered minor.

What are optional benefits?

Optional car accident benefits are enhancements or add-ons to your insurance policy for an additional cost.

Some optional benefits bump up the maximum amount you can receive for certain benefits that come “standard” with your policy. For example, standard income replacement is up to $400/week, but you can pay extra to increase that to anywhere from $600 to $1000/week. You can increase the amount you have available for medical and rehab benefits, too. Standard benefits are $1M for a catastrophic injury, $50K for a non-catastrophic serious injury and $3,500 for a minor injury. You can bump those ceilings up to $2M for a catastrophic injury or anywhere from $100K to $1.1M for a non-catastrophic injury. (Injuries that fall into one of the categories considered “minor” are capped at $3,500, regardless of whether you opted to bump up your coverage.) Attendant care benefits, which provide compensation for personal care services such as bathing, dressing and meal prep, are capped at $36K under the standard benefits scenario, but they can be increased as well.

You can also opt to add extra benefits that standard benefits don’t offer. Examples are housekeeping benefit (to pay someone to do your house work if you can’t) and caregiver benefit (to pay someone to care for your dependents if you were their primary caregiver before your injury).

Whether you purchase your insurance directly from a company or deal with a broker, they have to explain optional benefits to you and offer you the opportunity to purchase them. It’s the law.

Should I purchase optional benefits?

The short answer is yes.

When insurance regulations changed in 2010, the “standard benefits” that everyone with auto insurance is eligible for were reduced. A lot.

Standard medical and rehabilitation benefits were slashed in half for serious injuries and reduced by almost 97 per cent for minor injuries. If you think about all the healthcare services that aren’t covered by OHIP—medication, psychologists, medical devices, vocational retraining, physio, massage and occupational therapy…and the list goes on—those costs can definitely add up fast. Attendant care benefits, which cover the costs of personal care while you’re injured, were cut in half, too. Housekeeping benefits were eliminated altogether.

How much will optional benefits cost me?

Very few Ontario drivers purchase optional benefits with their insurance—in most cases, the opt-in rate is less than one per cent—but they don’t necessarily cost a lot. We surveyed five of Ontario’s largest insurance companies, using a 35-year-old female driver as an example, and it turns out extra peace of mind doesn’t have to break the bank.

Increasing the medical rehab benefit from $50K to $1.1M and the attendant care benefit from $36K to just over $1M cost as little as $107 from one insurer we surveyed. Adding housekeeping and a caregiver benefit started at $88. Bumping up income replacement from $400/week to $1000/week added as little as $134 to our hypothetical driver’s annual premium.

Talk to your insurance broker or insurance company about what optional benefits are available to you, and how much they’ll cost. If you’re not happy with the answer, maybe it’s time to shop around.