Ontario’s Auto Insurance Needs A Tune-Up

Last updated: 01-09-2020

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Ontario’s Auto Insurance Needs A Tune-Up

Since I joined the race to become leader of the Ontario Liberal Party, my fellow candidates and I have tackled some important issues.

But Ontario’s ramshackle, confusing and unfair auto insurance regime has not been among them. That needs to change.

The truth is that our auto insurance system has been failing for years, from a consumer standpoint. And it’s poised to get worse again under the management of Premier Doug Ford and his crew.

In recent decades, rather than a steady improvement in coverage and benefits, as we would expect, Ontarians have seen steady erosion — first under a Liberal government, and more coming soon under Conservatives. The New Democrats also tried their hand at reform, when they were in power — to little avail.

Ontarians are living every day with the consequences of this three-way failure of leadership.

Though it’s tough for Liberals to acknowledge, our auto insurance today is far less beneficial for people who are injured in serious car accidents than it was a decade ago. And it got worse while we were in power. We helped create the mess.

In fact, our party presided over 17 different changes to insurance coverage between 2010 and 2018, 16 of which made it more difficult for injured people to access care and compensation after motor vehicle accidents. Ontarians were promised a 15-per-cent reduction in premiums in return for the cuts, which later turned out to be a “stretch goal” — one we didn’t stretch enough to achieve.

Big insurance providers, meanwhile, continue to count their money. And Ontario drivers are required by law, of course, to buy this increasingly inadequate product.

Ontario’s system is expensive (and so are its premiums) because of the bureaucracy needed to manage our patchwork of laws and regulations. Frequent adjustments to the laws have created uncertainty that leads to more medical assessments, more litigation and higher costs.

In 2008, Ontarians who were injured had access to $100,000 in medical rehabilitation funds through their own auto insurance. Now, most injured people have access to only $3,500, which is quickly exhausted. Where do people turn when the money runs out? To their family doctors’ offices and to the emergency rooms, which are already overstretched.

“Secret deductibles” are another anti-consumer aberration. Set out in the Insurance Act, these are dollar amounts the insurance companies are allowed to keep when their insured driver is at fault for someone else’s pain and suffering, or income loss.

In 2003 the Ontario government raised the pain and suffering deductible from 15,000 to 30,000. In 2015 they raised it again to index it with inflation, retroactively to 2003. In 2019 it’s just under $39,000.

Here’s what that means: If your compensation for pain and suffering is assessed by a jury at trial at $50,000, you receive just $11,000. And here’s the kicker: The jury is not allowed to be informed of the deductible. They think the injured person is receiving $50,000, when they’re actually getting $11,000.

If we want a system that is fair and supportive of people injured in serious accidents, the time has come to increase the transparency of our motor vehicle accident system, while restoring fairness and balance. This should include:

· Abolishing the secret deductible on pain and suffering.

· Restoring Interest for injured MVA victims to five per cent to provide incentives for insurers to pay on time.

· Restoring benefits for car accident victims and caregivers, across the board, to at least their 2010 levels

Ontario’s auto insurance regime is in a state of abject disrepair and has been for years. There is zero evidence that the Ford government has the will or skill to make the changes needed.

It’s time for us to take a hard look at this system, set partisanship aside, put consumers and victims first, and fix it.


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