Roseman: Why our accident benefits system may be the worst

Roseman: Why our accident benefits system may be the worst

In just one second, your life can be turned upside down by a motor vehicle accident.

Whether you’re driving, cycling or walking, you’re a heartbeat away from a serious injury and a fight with an insurer to cover your medical treatments.

You probably don’t realize how little you get in statutory accident benefits under your auto insurance policy.

Ontario has a $1 million limit on medical and rehabilitation claims for those with catastrophic injuries. But they make up only one per cent of the 65,000 Ontarians injured in car accidents each year.

Almost 20 per cent of accident victims have severe noncatastrophic injuries. Their benefits are capped at $50,000, down from $100,000 before the reforms came in.

The remaining 80 per cent of accident victims with so-called minor injuries — such as whiplash, strains and sprains — get only $3,500 in medical benefits (down from $100,000 before).

Ontario’s car insurance reforms, forcing you to pay more for less coverage, didn’t become a high-profile issue in the last election. That’s a shame.

In a column on Oct. 5, I said the Ontario government had betrayed the trust of motorists and failed to protect them from inflated insurance costs. This drew widespread support from readers.

Some said I had underplayed the minor injury changes and their major effect on the out-of-pocket costs of accident victims.

“For those put into the minor injury guideline (the MiG), we now have the worst benefits system in North America,” said Stanley Pasternak, an injury and insurance lawyer.

“There is no real lobby for the best interests of injured people. No one really wants to hear from their lawyers. Yet the insurance company lobby is incredibly powerful.

“And since there are hundreds (or thousands) of motorist voters for every injured person voter, the government jumps when the insurance industry utters the words ‘premium increase.’”

With 80 per cent of victims placed in the minor injury guideline program, “the $50,000 in benefits is available to the very few,” said Darren Milne, a chiropractor who acts as a medical legal examiner for the insurance industry.

“You’re right this should be an election issue. The parties have focused on insurance costs by saying the changes will address fraud (which they do not) and therefore will reduce costs (which they have not).

“They should really be focusing more on insurer benefits.”

Liberal Premier Dalton McGuinty, now heading a minority government, may be asked to explain why motorists’ premiums are still climbing after accident benefits were slashed.

Ontario’s auto insurance rates went up by an average 3.05 per cent in the third quarter of this year, the Financial Services Commission of Ontario said in an Oct. 17 release.

Standard accident benefits went up 4.6 per cent during the quarter — the largest increase of any type of coverage, FSCO added.

“This is suspect and needs to be investigated,” says Nick Gurevich, head of the Alliance of Community Medical and Rehabilitation Providers.

Ontario’s $3,500 cap on minor injury benefits is the lowest of all provinces, he points out. Victims get up to only $2,200 at first and have to apply again to get the full $3,500.

About 70 per cent of his group’s clients require more than $2,200 in benefits for minor injuries, Gurevich said. But 40 per cent of them are turned down when they reapply.

I also heard from accident victims, including a couple who spent weeks in the hospital recovering from a motorcycle accident.

After buying optional coverage to boost their accident benefits to $100,000 each, they ran through the money long before the year was over.

“We needed the assistance of physiotherapists, occupational therapists, massage, pool facilities, gym, to name a few,” the wife said.

“The accident changed our lives forever in the blink of an eye. Everyone thinks it will never happen to them, but we are proof that it does.”

Ellen Roseman writes about personal finance and consumer issues. You can reach her at

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