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Monetary Thresholds and Deductibles

Each year in Ontario are thousands of car accidents resulting in injury and death. According to the Preliminary 2020 Ontario Road Safety Annual Report, that number was 43,353. Among these involved in collisions, there were 535 fatalities.

 

If you’re a victim of an auto accident, you can file a claim to be compensated for your injuries and impairments. One form of compensation is by bringing a tort claim (i.e.: lawsuit) against the at-fault driver’s insurance company.

 

This allows you to recover compensation for:

  • Pain and suffering;
  • Out of pocket expenses such as medical care;
  • Loss of income; and
  • Damages not included in your auto cover benefits.

 

However, if your claim is successful, you will rarely receive full compensation. This is due to monetary thresholds and deductibles as per the Ontario Insurance Act. Read on to learn more about monetary thresholds and deductibles and what to expect between January 1, 2022, and December 31, 2022.

 

What is the Threshold (Permanent & Serious)?

 

As mandated by the Insurance Act, the Financial Services Regulatory Authority (FSRA) publishes guidance on automobile insurance indexation amounts. This guidance stipulates how indexation will affect insurance claims during the year.

 

The indexation percentage FSRA publishes applies to:

  • Monetary thresholds and deductibles for determining non-pecuniary tort awards in accordance with the insurance Act and O. Reg. 461/96 (Court Proceedings for Automobile Accidents that Occur on or after November 1, 1996)
  • Indexed amounts as per 2010 SABS, 1996 SABS, and 1993 SABS

 

Due to amendments to the Ontario Insurance Act, the compensation you’re eligible to receive after an accident has been reducing since August 2015. The government’s objective for implementing reductions is to lower costs for insurance companies and, in turn, lowering premiums for all Ontarians. Unfortunately, for you and other car accident victims, this means the compensation for your injuries and pain and suffering will be lower.

 

Whether this objective (insurance premium decreases) has been achieved is beyond the scope of this blog post.  That said, when was the last time your auto insurance premiums went down?

 

This change came with an increase in the deductible amounts for pain and suffering. Deductibles refer to the amount stripped away by Ontario insurance laws from the compensation you’re awarded for pain and suffering.

 

Indexation for the thresholds and deductibles is based on the Canadian Consumer Price Index (CPI), which varies each year. They apply to non-pecuniary tort awards, which are popularly known as general damages. Such damages are intended to provide victims with compensation for pain and suffering, loss of enjoyment of life, and loss of amenities.

 

For 2020, damages below the threshold of $138,343.86 will be subject to a deductible. According to the Family Law Act (“FLA”), similar thresholds and deductibles are also applied to successful claims by family members for loss of companionship, care, and guidance according to the FLA.

 

Threshold and deductibles deter accident victims, even those with serious injuries, from filing claims. Insurance companies are the beneficiaries.

 

This is because, with these deductibles, accident victims can file claims for their injuries and receive zero dollars even if they’re awarded compensation from a jury. Such a case occurs when a jury awards the plaintiff or family members an amount that’s below the deductible’s quantum. And for the lucky ones to receive something, it’s only after the deductible is automatically applied, leaving them with only a small amount.

 

A good example of this is a case where a plaintiff fractured their right wrist and sustained soft-tissue injuries to his hip, lower back, and right knee. Although the fracture healed, he was left with mild deformity, continued to suffer from wrist pain, and his pinch and grip strength reduced. After several months of physiotherapy, his back pain was resolved.

 

For the right knee and hip impairment, it was determined that a pre-existing condition was responsible. During the 2020 trial, the jury awarded him $35,000 for the pain and suffering due to the wrist injury. However, the plaintiff did not receive a single cent as the amount was below the $39,556.53 deductible in 2020.

 

For 2022, the deductible for general damages that do not meet the threshold will be $41,503.50. This is a rise of $1,749.19 from the $39,754.31 deductible in 2021.

 

For FLA damages, the 2022 deductible for claims that do not meet the threshold is $20,751.76. Compared to the $19,877 deductible in 2021, this is an $874.76 rise.

 

What are the Monetary Thresholds in the case of damages for non-pecuniary loss from January 1, 2022, until December 31, 2022

 

For 2022, monetary thresholds and deductibles for non-pecuniary tort awards under the Insurance Act and O. Reg. 461/96 (court proceedings for automobile accidents that occur on or after November 1, 1996) are as follows:

 

Section reference in the Insurance Act Description Amount
267.5 (8.3) Damages for non-pecuniary loss other than those under section 61 (2) (e) of the Family Law Act $138,343.86
267.5 (8.4) damages for non-pecuniary loss under section 61 (2) (e) of the Family Law Act $69,171.36

What are the Deductible Amounts in the case of damages from January 1, 2022, until December 31, 2022?

 

In cases involving damages, the deductible amounts for the period between January 1, 2022, and December 31, 2022, will be as follows:

 

Section reference in Court Proceedings for Automobile Accidents That Occur on or after November 1, 1996 (O. Reg. 461/96) Description Amount
5.1 (1) deductible for damages for non-pecuniary loss other than those under section 61 (2) (e) of the Family Law Act  

$41,503.50

5.1 (2) deductible for damages for non-pecuniary loss under section 61 (2) (e) of the Family Law Act $20,751.76

 

Get the Support You Need

 

Regardless of how careful you are, it’s impossible to be completely void of accidents. In any accident, you may sustain injuries that may leave you with disabilities and pain indefinitely, or for the rest of your life. In addition, it can limit your capacity to continue working.

 

Considering all this, it’s important that you get the compensation that you deserve. And this is where an experienced injury lawyer can assist. We have a team of experienced injury lawyers ready to assist you with your case. Book a consultation today to learn more about how we can assist you with your case.

 

About the Author

Gavin Cosgrove

Gavin Cosgrove is a graduate of Holy Cross Catholic Secondary School in Kingston. Upon graduation, he attended Manhattan College (New York, NY) on an athletic scholarship where he competed in track and field. Gavin completed his legal studies at the University of New Brunswick.

Gavin joined Bergeron Clifford in the summer of 2009 and is now a partner with our firm.

Gavin is a proud member of the Ontario Trial Lawyers Association, the Frontenac Law Association, the County of Carleton Law Association, The Advocates’ Society, and the County of Lanark Law Association. He represents innocent victims of negligence in auto cases, medical malpractice and negligence cases.

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