What You Should Know About Ontario Auto Insurance Reforms

As of September 1, 2010, the government has approved a number of changes to the way Ontario auto insurance is administered.  The Insurance Act was amended in 2003 to require a review of auto insurance in Ontario every five years.  The first such review took place in 2008, yielding a list of 41 proposed reforms.  From these reforms, new regulations were announced in March of 2010 and will become effective on all car insurance policies in Ontario that are initiated or renewed after September 1st of this year.

The goal of the new initiative is to streamline the insurance system, while giving consumers more choice and promoting price stability among insurance premiums.  Most of the changes allow consumers the opportunity to customize their insurance coverage by adding coverage in areas that they deem important.

Despite the new regulations, you should keep in mind that the basic structure of your car insurance won't change.  You will still be covered for the same types of losses as before, including the following:

  • Accident benefits:  These are benefits paid for things like medical treatments, income replacement and attendant care if you are injured in a car accident.
  • Property Damage:  Property damage covers the cost of damage to your vehicle if another person is at fault for an accident that occurred in Ontario.
  • Third Party Liability:  This covers you if you are held legally responsible for damages as a result of a car accident.
  • Uninsured Auto:  This pays a benefit if you are injured by an uninsured driver or in the case of a hit and run accident.
  • Optional Coverage:  Any optional coverage that you currently have will not change.  This includes collision and comprehensive coverage.

    Many of the new changes will affect the accident benefits portion of your policy.  For example:

    Medical, rehabilitation and attendant care:

    For injuries that are deemed to be minor, the new maximum benefit is capped at $3,500.

    For more severe injuries, but non-catastrophic, the new standard coverage amount is $50,000. You now have the option to increase it to $100,000 or $1,100,000.  For attendant care, your standard coverage amount will now be $36,000 and you have the option to increase it to $72,000 or $1,072,000.

    For catastrophic injuries, the new standard coverage for both medical expenses and attendant care will be $1,000,000 and you have the option to increase it by $1,000,000.

    Caregiver benefit:

    You are eligible for a caregiver benefit if you provide full time care for dependants and become unable to care for them due to catastrophic injuries suffered in a car accident.  The standard amount is $250 per week for one dependant and $50 per week for additional dependants.  With the new changes, you will be able to extend this coverage to all types of injuries.

    The same applies to housekeeping and home maintenance.  The standard amount is $100 per week, but you can now opt to extend this coverage to non-catastrophic injuries.

    Income replacement:

    If you are unable to return to work following a car accident, the income replacement section of your accident benefits package pays you 70 percent of your gross income prior to the accident to a maximum of $400 per week.

    As a result of the new changes, you can opt to extend this maximum amount to $600, $800 or $1,000 per week.

    Dependent care:

    This optional benefit helps you cover child care costs that occur as a result of you being in an accident.  The maximum benefit is $75 per week for your first dependent, and $25 per week for each additional dependent, up to a maximum of $150 per week.

    Death and funeral

    If you die as the result of a car accident, the standard benefit amount paid to your spouse is $25,000, $10,000 to each dependent and up to $6,000 for funeral expenses.  The new regulations allow you to increase the amounts to $50,000 for your spouse, $20,000 for each dependent and $8,000 for funeral expenses.


    You can now opt to have your payable benefits for medical, rehabilitation and attendant care, income replacement and non-earner benefits indexed each year based on the Canadian Consumer Price Index. This means that your benefits will increase each year by roughly the same amount as inflation.

    If you are unsure about any of these policy changes and how they will affect you, talk to your insurance agent or broker to get the full details for your specific policy.  Under the reformed insurance legislation there may be ways that you can secure cheap car insurance or coverage that is more targeted to your personal needs.