Accident benefits is a type of car insurance coverage that is mandatory in most Canadian provinces and territories. The purpose behind accident benefits is to provide a policyholder with compensation if they or another person is injured or killed in a car accident. Accident benefits cover drivers, passengers, and pedestrians involved in an accident. Keep reading to learn more about how accident benefits coverage works and what benefits it offers.
Accident benefits defined
The Financial Services Regulatory Authority of Ontario defines accident benefits as follows: "This section of your automobile insurance policy provides you with benefits if you are injured in an automobile accident, regardless of who caused the accident, including supplementary medical, rehabilitation and attendant care, caregiver, non-earner and income replacement benefits. Options exist to increase most of these coverages."
Given this definition, accident benefits coverage comes into play when you get into an accident, only if a driver, passenger, or pedestrian involved in the accident requires medical attention due to the collision. Accident benefits coverage is provided no matter who was at fault for the accident (i.e. it’s applicable even if the policyholder was liable for the accident) and it can help cover a wide range of associated expenses, such as medical fees for prescription medications, physical therapy, rehabilitation, or loss of income.
What is covered by accident benefits in Ontario?
A detailed description of the coverage included with accident benefits in Ontario can be found in the Statutory Accident Benefits Schedule (SABS). SABS outlines both the mandatory and optional limits for medical care, death, funeral expenses, income replacement, and loss of income from disability. However, we provide an overview of what is covered by accident benefits below. Since accident benefits coverage is mandatory in Ontario, you can expect to receive the following coverage under the accident benefits portion of your car insurance policy:
Income replacement benefit
If you are unable to work following the accident, you may qualify for benefits of up to 70% of your gross income (capped at $400/week). However, drivers in Ontario have the option of increasing this cap to $1,000/week.
If you can no longer provide care to a dependent due to the accident, you may be entitled to compensation to hire someone to help you care for them. Caregiver benefits apply to specific injuries, however, optional endorsements can be added to your accident benefits coverage to include a broader range (or even all) injuries.
If you don’t qualify for the income replacement benefits - perhaps you are a student and do not earn an income yet - you may still qualify for non-earner benefits. These benefits apply to those who cannot continue with their daily lives as a result of the accident. Non-earners may qualify for compensation up to $185 per week.
Medical and rehabilitation benefit
Medical and rehabilitation benefits help cover the cost of medical and rehabilitation expenses that are not covered by the provincial government (OHIP) or your private healthcare plan. Examples of medical expenses that this benefit may cover include prescriptions, physiotherapy, chiropractic, counselling, and more. A complete list of types of medical care and costs that qualify for medical and rehabilitation benefits are listed in the SABS.
Please note that compulsory coverage in Ontario includes up to $65,000 for non-catastrophic injuries and up to $1,000,000 for catastrophic injuries. However, all drivers have the option of increasing the coverage limit to $130,000 for non-catastrophic injuries and $2,000,000 for catastrophic injuries.
Attendant care benefits
If you cannot continue as a primary caregiver as a result of the accident, you can be provided with assistance at your home or healthcare facility until you recover. Attendant care benefits are designed to help single-parent homes, homes with one stay-at-home parent, and households with dependents. Under the attendant care benefits portion of your policy, you may qualify for up to $250 per week and an additional $50 per week for each subsequent dependent living with you.
Death and funeral benefits
If you (the policyholder) die in the accident, your family is entitled to compensation under the death and funeral benefits section of the policy. Specifically, the following may be paid out:
- $25,000 to your spouse
- $10,000 to each of your dependents
- A maximum of $6,000 to cover funeral expenses
- $10,000 to former spouses if the policyholder had financial obligations to them
Please note that the policyholder has the option of increasing coverage limits so that $50,000 is paid to their spouse, $20,000 to their dependents, and $8,000 for funeral expenses.
Other expenses that may be covered by accident benefits insurance include the following:
- Housekeeping and home maintenance: You could receive up to $100/week for reasonable expenses to help with the housekeeping and maintenance of your home during your recovery period.
- Expenses of visitors: Compensation for expenses incurred by family members and friends who come to visit you during your recovery period and subsequent treatments. Only certain people qualify, such as your spouse, children, grandchildren, grandparents, parents, and siblings.
- Cost of examinations: Compensation for the cost of examinations that are required as part of your recovery treatment plan.
- Lost educational expenses: Compensation for lost tuition, textbooks, and other education-related expenses up to $15,000.
- Damage to clothing, glasses, and personal medical devices: Policyholders may receive compensation for any clothing, glasses, or personal medical devices damaged during the collision.
Optional accident benefits coverage in Ontario
A basic form of accident benefits coverage is mandatory in Ontario. However, additional benefits are available to Ontario drivers should they wish to purchase more coverage. For example, drivers can choose to increase the coverage limits for many of the benefits listed above or purchase extra types of accident benefits. A few examples of optional accident benefits coverages are listed below:
Dependent care benefits
If you were employed at the time of the accident and are responsible for one or more dependents, dependent care benefits might come in handy. With this type of coverage, your insurance company may pay you $75/week for your first dependent and $25/week for each additional dependent to cover the cost of extra child care expenses due to the injuries sustained in the accident.
Indexation benefits (Consumer Price Index of Canada)
Indexation benefits can be added to your accident benefits policy to give you an annual adjustment for yearly inflation rates. Adjustments are always done in accordance with the Consumer Price Index of Canada.
Other mandatory car insurance coverage in Ontario
Now that you understand more about accident benefits coverage, we are going to provide a brief overview of the other coverage types that are mandatory in Ontario. From third party liability coverage to uninsured automobile coverage, your car insurance policy must include the following coverages to be valid:
Third party liability coverage
Third party liability coverage provides legal protection if you injure someone else or cause property damage to another person’s property on the road. This type of coverage can help pay for medical expenses associated with bodily injuries or repairs of damaged cars, as well as any applicable legal fees and settlements up to the coverage limit. In Ontario, drivers are required to hold a minimum of $200,000 in third party liability coverage at all times.
Direct compensation - property damage coverage
Direct compensation - property damage coverage protects an insured vehicle and its contents against property damage, so long as the policyholder is not at fault for the collision that caused said damage. Under this type of coverage, the insurance provider typically pays for the repair or replacement of your car directly. Note that to be eligible for direct compensation coverage, the collision must meet the following circumstances: it occurred in Ontario, it involved more than one vehicle, and it involved at least one vehicle that participates in the province’s car insurance program.
Uninsured automobile coverage
Uninsured automobile coverage is designed to protect you and any passengers in your vehicle if you get into a collision with an at-fault driver who is either uninsured or underinsured. This type of coverage can also protect the policyholder in the event of a hit-and-run.
Get accident benefits coverage today with BrokerLink
Learn more about accident benefits coverage by contacting BrokerLink today. Our insurance advisors know the ins and outs of the auto insurance industry and will ensure you find accident benefits coverage that not only complies with provincial law but that also meets your needs.
Give us a call to speak with an expert insurance broker today or visit us in person at one of our many locations in Canada. We also encourage all drivers in Canada to take advantage of our online quote tool and request a free quote now. However you choose to get in touch, BrokerLink is here for all your car insurance needs.
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