I’ve heard “no-fault” and “accident benefits” – what does that mean, and does it mean no one sues anyone after a crash?


I’ve heard “no-fault” and “accident benefits” – what does that mean, and does it mean no one sues anyone after a crash?
August 17, 2021

The short answer – no! In the early 1990s, the provincial government introduced a new scheme in the hopes of reducing liability insurance premiums that had skyrocketed in the mid-to-late 1980s. This scheme included a no-fault benefit system where you could access benefits through the coverage of your own automobile insurance policy regardless of who was responsible for causing the collision.

This system is commonly referred to as accident benefits. The idea is to provide persons injured in a car accident with a safety net that can be quickly accessed after they’re injured through their own automobile insurance company, avoiding the need to pay for out-of-pocket treatment expenses. The two most common accident benefits coverages accessed are:

Income replacement benefit (“IRB”)
The amount typically paid by the automobile insurer is $400/week, which can be increased by adding optional benefits if the injured person was not working when they were hurt, there are alternative options including the non-earner benefit (“NEB”), for students and retirees, and the caregiver benefit (“CG”), for those who may have been responsible for taking care of a loved-one.

Medical-rehabilitation (“M/R”) and attendant care (“AC”)
The amount a person is eligible for is based on the extent of their injuries.

Fortunately, an injured person is still able to bring a claim (i.e. sue, lawsuit). Unfortunately, the trade-off for being able to access accident benefits is that it impacts an injured person’s ability to recover damages from the at-fault driver who caused the accident. Some of the restrictions include:

  • Only able to recover 70% of past gross income loss, but 100% of future income losses are recoverable
  • Future medical and rehabilitation expenses are subject to the threshold
  • Compensation for pain and suffering damages is reduced by a deductible

As of 2021, the deductible is nearly $40,000, and any claim is also subject to the threshold.

Although the hope was to lower insurance premiums, it has not been so. Ontario drivers’ premiums continue to increase while their automobile insurers have successfully reduced the duration for which a claim for accident benefits is open and the amount of coverage drivers can access under the medical-rehabilitation/attendant care portions of their policy. 

Have any questions or concerns regarding an injury? Call 905-522-9799 to arrange a free initial legal consultation with Findlay Personal Injury Lawyers. Our lawyers will work to ensure you will be compensated accurately for your accident. We proudly serve Hamilton, Brantford, Burlington, St. Catharines, Niagara Falls, Paris, and other areas of Ontario.

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