Starting July 1, 2026, Ontario will see one of the biggest overhauls in its automobile insurance accident benefits regime in decades. The Statutory Accident Benefits Schedule (SABS) is being amended under Regulation 383/24.

The most significant change that has lawyers in the motor vehicle accident space talking is this:  many benefits that are now automatic will become optional.

What is changing

Here are the headline shifts:

• Which benefits stay mandatory vs. become optional

  • What remains mandatory: medical, rehabilitation, and attendant care benefits.
  • What becomes optional: many of the benefits that used to be automatically included. These include things like income replacement, nonearner benefits, caregiver benefits.

• Who can get optional benefits

  The eligibility for optional SABS coverages will be limited under the new regime. Optional benefits will only be available to:

1. • The named insured on the policy
   • Their spouse and dependants / spouse’s dependants
   • Any drivers specifically listed on the policy.

This means many people who currently have access to benefits (e.g. pedestrians, cyclists or passengers without their own policy or not listed) might find themselves without coverage for many benefits unless the optional coverages are purchased.

• “First payer” change

  Auto insurers will now become the first payer for the mandatory medical and rehabilitation benefits. That means instead of needing to exhaust workplace benefits or private health plans first, the auto insurer steps in up front.

In our view, this is a positive change.  The current requirement to exhaust private health plans first is a bureaucratic nightmare that is 1) unfair; and 2) leads to delays in access to care as claimants, providers, and adjusters alike are confused about the process.

Why these changes matter (and what to watch out for)

• Cost vs coverage tradeoffs: For many people, foregoing (“opting out of”) optional coverage may seem like a good way to save on premiums.  But some of those benefits, like the income replacement benefit, are exactly the ones people often need most in an accident. If you don’t buy them, you might face significant financial risk later.
• Vulnerable and uninsured populations: Pedestrians, cyclists, those injured who are not listed as drivers, or those who don’t own cars — many of these people may lose access to optional benefits unless someone in whose policy they are involved has purchased them. That could lead to situations where people have fewer recourses after an accident.
• Potential for more tort litigation: Losses uncovered by accident benefits must be pursued through the tort system (i.e. suing the atfault driver) to get compensation. That can be slower, more complex, and more costly. Some legal commentators expect that to put upward pressure on liability insurance costs.  On the other hand, accident victims who aren’t receiving income replacement benefits might be pressured to take a low settlement because they have no income and can’t afford to wait for their day in Court.
• Increased burden on the public purse:  Accident victims who cannot work will turn to EI, OW and ODSP for immediate income assistance post-accident.

Bottom line

The SABS amendments effective July 1, 2026 represent a paradigm shift.  Benefits built into standard auto policies for decades will become elective.

If you live in Ontario or are insured under an Ontario auto policy, this is not a distant theoretical change — it will affect coverage decisions, risk planning, and possibly costs as soon as mid2026. It’s wise to review your current policy, talk with your broker well ahead of July, and think carefully about which optional benefits might be worth preserving.

ROBERT MURPHY

Rob attended law school at Queen’s University and graduated with his Juris Doctor in 2020.  He summered at and completed his articles with Weaver, Simmons LLP, a full-service firm in Northern Ontario.  During his articles Rob had the opportunity to see personal injury files from both the plaintiff side and the defence side.  After articles, Rob practiced injury law and general litigation with Kelly + Kelly Lawyers in Pembroke, until Kelly + Kelly’s civil litigation practice joined Bergeron Clifford in 2023.

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