AUTO INSURANCE COVERAGE IN ONTARIO
The issues about automobile insurance coverage are directly connected with the motor vehicle accidents and traffic tickets. That is why we decided to give you some useful and extended information about auto insurance: types of auto insurance, what insurance policy is, what is your liability, how your auto insurance rates are set, accident benefits coverage and more. We hope that this information will help you to better understand automobile insurance.
Auto Insurance – It’s the Law!
Ontario law requires that all motorists have auto insurance. Fines for vehicle owners, lessees and drivers who do not carry valid auto insurance can range from $5,000 to $50,000.
If you are found driving without valid auto insurance, you can have your driver’s licence suspended and your vehicle impounded.
If you are convicted of driving without valid auto insurance, your insurance company may consider you a “high-risk” driver and charge you higher premiums or refuse to sell you insurance altogether.
If you are injured in an accident while driving or occupying an uninsured vehicle:
- you may not be entitled to receive income replacement and/or non-earner benefits; and
- you may not be allowed to sue the at-fault driver for compensation as a result of injuries received in the accident.
More importantly, if you are found to be at fault for an accident causing injury or death to another person, you may be held personally responsible for his/her medical costs and other losses.
Auto Insurance Policy
Your insurance company is responsible for providing you with the insurance coverage summarized on your Certificate of Automobile Insurance, and for which you pay a premium.
Certificate of Automobile Insurance:
- lists the vehicles that are insured and the coverage purchased,
- provides a description of how you were rated for the premiums charged, and
- indicates the period during which you are covered by insurance
It is important that you read this certificate. You only have insurance coverage for a vehicle if your Certificate of Automobile Insurance shows a premium for that vehicle or shows that the coverage is provided at no cost.
If you own a vehicle in Ontario, you are required to, at the very least, purchase the following automobile insurance coverage:
- Third-Party Liability Coverage: This section of your automobile insurance policy protects you if someone else is killed or injured, or their property is damaged. It will pay for claims as a result of lawsuits against you up to the limit of your coverage, and will pay the costs of settling the claims. By law you must carry a minimum of $200,000 in Third-Party Liability coverage
- Statutory Accident Benefits Coverage: This section of your automobile insurance policy provides you with benefits if you are injured in an automobile accident, regardless of who caused the accident including supplementary medical, rehabilitation, attendant care, caregiver, non-earner and income replacement benefits
- Direct Compensation – Property Damage (DC-PD) Coverage: This section of your automobile insurance policy covers damage to your vehicle or its contents, and for loss of use of your vehicle or its contents, to the extent that another person was at fault for the accident. It is called direct compensation because even though someone else causes the damage, you collect directly from your own insurer, instead of the person who caused the damage. Coverage under the DC-PD section of your automobile insurance policy only applies if the following conditions are met: 1) the accident took place in Ontario; 2) there was at least one other vehicle involved in the accident; and 3) at least one of the other vehicles is also insured by an insurance company that is licensed in Ontario or has signed a special agreement with FSCO to provide this coverage. If these conditions are not met, then you can make a claim on your optional Collision coverage (if you have it), whether or not you are at fault. If you don’t have Collision coverage, you may be able to pursue recovery from the at-fault driver to the extent you were not-at-fault for the accident.
- Uninsured Automobile Coverage: Protects you and your family if you are injured or killed by a hit-and-run driver or by an uninsured motorist. It also covers damage to your vehicle caused by an identified uninsured driver.
- Increased Liability and Accident Benefits Coverage: In addition to the mandatory minimum coverage that is required by law, you may purchase higher liability limits under your Third-Party Liability Coverage, as well as increased Accident Benefit Coverage. These options will allow you to customize your policy to better suit your needs.
- Increased Third-Party Liability Coverage: While you are legally required to carry a minimum of $200,000, you may want to increase this coverage. The cost to increase your Third-Party Liability coverage to $1 million or $2 million is small in most cases.
- Income Replacement Benefits: If you cannot work as the result of an automobile accident, you may be eligible for basic weekly income replacement benefits of 70 per cent of your gross income up to $400. If this is not enough to cover your current after tax income level, you may want to consider buying optional income replacement benefits to increase your maximum weekly protection to $600, $800 or $1,000. When considering the amount of coverage you will need, keep in mind you are required to first claim wage loss benefits from a disability plan you have purchased or workplace benefits that you have access to.
- Medical, Rehabilitation and Attendant Care Benefits: The standard maximum amount for medical and rehabilitation expenses, such as physiotherapy, chiropractic treatment, dental expenses, etc., is $50,000. If you are catastrophically injured, the standard maximum is $1,000,000. The standard maximum for attendant care is $36,000. If you are catastrophically injured, the standard maximum is $1,000,000. You can buy optional benefits which will cover up to $100,000 or $1,100,000 in medical and rehabilitation expenses and $72,000 or $1,072,000 in attendant care expenses, and up to $3,000,000 in combined medical, rehabilitation and attendant care expenses for catastrophic injuries. Keep in mind that many health care expenses are not covered by OHIP, or only partially covered, including physiotherapy and chiropractic treatment, mobility devices (crutches, wheelchairs), modifications to your home and car that you may require, and other specialized goods and services. Minor injuries may only require several thousand dollars in treatment. The most serious injuries (brain injuries, amputations) are permanent and may require hundreds of thousands of dollars in specialized goods and services on an ongoing basis. You may need the services of an attendant 24 hours a day. Review any extended health care plan you and your spouse have access to through work to help you decide how much coverage you require.
- Caregiver Benefits: If you are providing care full-time to dependants and can no longer provide that care as the result of an automobile accident, you may be eligible for caregiver benefits if you need to hire someone to care for your dependants. The maximum amount for caregiver benefits is $250 per week for one dependant, plus $50 per week for each additional dependant. The standard coverage is only available to those who are catastrophically injured in an auto accident. You can extend coverage to all injuries by purchasing the optional benefit. If you have children you need to consider who will look after them if you are injured in an auto accident.
- Housekeeping and Home Maintenance Expenses: If you are unable to perform your usual housekeeping or home maintenance duties, these corresponding benefits pay for someone to perform the duties. The maximum benefit payment is $100 per week. The standard coverage is only available to those who are catastrophically injured in an auto accident. You can extend coverage to all injuries by purchasing the optional benefit. If you normally do the cleaning and maintenance of your home, you need to consider who will look after these things if you are injured in an auto accident.
- Dependant Care Benefits: This optional benefit can only be claimed if you were employed at the time of the accident, are not receiving a caregiver benefit, and have to pay for additional childcare expenses as a result of the accident. Optional dependant care benefits cover up to $75 per week for the first dependant and $25 for each additional dependant.
- Death and Funeral Benefits: In the event that you die as a result of an auto accident, the standard amount which will be paid is $25,000 to your eligible spouse, $10,000 to each dependant, and a maximum of $6,000 for funeral expenses. If you buy optional benefits, you can increase these amounts to $50,000 to your eligible spouse, $20,000 to each dependant, and $8,000 for funeral expenses.
In addition to the standard policy coverages you may also buy extra coverage for loss or damage to your vehicle including:
- Specified Perils Coverage: This coverage pays for losses caused by one of the following perils: fire; theft or attempted theft; lightning, windstorm, hail, or rising water; earthquake; explosion; riot or civil disturbance; falling or forced landing of an aircraft or parts of an aircraft; or the stranding, sinking, burning, derailment or collision of any kind of transport in, or upon which an insured vehicle is being carried on land or water.
- Comprehensive Coverage: This coverage pays for losses, other than those covered by Collision or Upset, including perils listed under Specified Perils, falling or flying objects, missiles and vandalism.
- Collision or Upset Coverage: This coverage pays for losses caused when an insured vehicle is involved in a collision with another object, including another vehicle, or rolls over. “Object” includes: another vehicle or a trailer that is attached to the vehicle that is covered by your insurance policy; the surface of the ground, and any object in or on the ground.
- All Perils Coverage: This combines Collision or Upset and Comprehensive coverages. In addition, it covers loss or damage caused if a person who lives in your home steals the vehicle that is covered by your insurance policy. All Perils also covers you if an employee who drives or uses, services or repairs that vehicle, steals it. For example, if you take your vehicle to a garage for repairs and an employee involved in the repair of your vehicle steals it, All Perils would cover you.
If you got a traffic ticket you might seek assistance from a paralegal that specialize in defending traffic ticket cases. The paralegal has to be licensed by the Law Society of Upper Canada. It is always a good idea to hire CP Paralegal Solutions to fight your traffic ticket. For more information please visit www.paralegaltoronto.ca
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