Car Accidents: A Crash Course Part 1 Whats no fault insurance?

When “no fault insurance” was first introduced in Ontario in 1994, people started to think differently about car accidents.

It all comes down to those two little words: “No fault.” They give the impression that fault doesn’t matter. That even if someone was responsible for the accident, no one cares.

This isn’t true—and even the Insurance Bureau of Canada will say so. “You certainly can’t be blamed for being confused about the term ‘no fault insurance,’” IBC’s website says. “Despite the misleading name, it does matter who caused the accident.” In IBC’s opinion, fault matters because it determines whether the accident will go on your insurance record and if your premiums will go up.

Personal injury lawyers, who are often asked to represent people who have been seriously hurt in car accidents, have another perspective to share. For them, fault matters because it allows a victim to sue the responsible party for general damages.

Unfortunately, the term “no fault” makes it sound like lawsuits are off the table. It’s like propaganda to protect the insurance companies. We hear it all the time. People we meet at a party or come in to the office to chat about a different kind of injury will say, “What do you do about car accidents? No one’s allowed to sue.”

That’s not true. But it takes some convincing.

Ontario’s auto insurance system is really “partial no fault.” Anyone who is injured in a car accident has the right to basic benefits, such as medical care and rehab that’s not covered by OHIP, up to a pre-determined amount. “No fault” simply means you go to your own insurer for these benefits, regardless of who was responsible for the accident.

But if these amounts aren’t sufficient to compensate you for pain and suffering, income loss or medical and personal care following a serious accident, you do have the right to sue the at-fault person for the extra you need. And that’s why it’s only a partial no fault system.

In a lawsuit, the opposing sides will be presenting evidence on two subjects: who was at fault and how much financial compensation you’ll need to get back to your pre-injured state (or, if that’s not possible, how much money you deserve to compensate you for the fact you’ll never recover fully). The suit is against the person who caused the accident, but the money usually comes from that person’s liability insurance, not his or her pocket.

Insurance companies will tell you that you don’t need a lawyer and they’ll act like your best friend because they want to control your file. The best remedy is to get a reputable personal injury lawyer on your side. We’ll let you know if you have a strong case and make sure we do the investigations and hire the experts to win.