2019 is the year of sweeping changes to various legal policies in Ontario. It started with Ontario’s Legal Aid budget cut earlier this year and the latest inclusion to the list is the overhauling of the auto insurance system in the province. However, the difference is the legal aid cut sparked criticism, changes to the rules of auto insurance have been welcomed by drivers and personal injury lawyers around the province.

The Progressive Conservative (PC) Party unveiled ‘Putting Drivers First’, the blueprints of the auto insurance changes in its budget on April 11, 2019. The proposed changes, significant for consumers and personal injury attorneys alike, include modifications of rules around legal fees, medical treatment, claims protocols and insurance premiums. This post outlines the highlights of these changes that are important for the drivers and auto accident victims to notice.

Auto Insurance Changes in Ontario: Significant Highlights

Lowered Auto Insurance Premiums

The ‘Putting Drivers First’ blueprint is focused on lowering the cost incurred by vehicle owners and drivers. With the new budget, the government’s vision is to make auto insurance more affordable and accessible. The proposed changes give control back to drivers by increasing the range of auto insurance coverage and decreasing the premium costs. It will make buying insurance more convenient for customers and increase competition in the auto insurance market. As a result, the customers will get accident benefits at a lower cost due to a more competitive market, thereby creating opportunities for savings.

Development of Fraud Reduction Strategy

Auto insurance fraud is prevalent in Ontario as it costs the industry about $1.3 billion a year in the province. That’s why the blueprint emphasizes on detection and prevention of auto insurance fraud so that honest drivers do not have to pay for dishonest actions of fraudsters. The government is planning to develop a fraud reduction strategy along with the Financial Services Commission of Ontario (FSRA) to modernize the systems that improve the delivery of health care benefits. It includes-

• Introduction of enhanced data analytics to detect fraud and new rules to prevent unfair practices
• A new online claims process to make it convenient for accident victims to easily file their claim and see how their auto accident benefits are being used

Transparent Contingency Fee Arrangements

For the uninitiated, contingency fees provide people with access to justice by allowing clients not to pay their legal fees until the case is settled or the trial result is out in the case of damage recovery. The government plans to work with the Law Society of Ontario to make contingency fee arrangements more transparent for claimants who choose to hire a personal injury lawyer to fight for compensation. This is a step to ensure the consumers’ rights are being fully protected.

Adoption of the Driver Care Plan

People severely injured in auto collisions often don’t receive timely access to claims as they find it difficult to navigate the claims process and understand their rights and the benefits available to them. It leads to disputes over benefits, delayed treatment for victims and taking forever to recover from injuries. To deal with the issues, the government has proposed to adopt the Driver Care Plan. It will ensure that injured claimants can access treatment faster. The plan includes-

• Restoration of the default benefit limit of $2 million for people injured in catastrophic injuries that was previously reduced to $1 million in 2016
• A Driver Care Card that will provide important information to consumers on how to navigate through the claim process
• An improved system for early treatment of common injuries including mental health treatment
• Introduction of ‘Care, Not Cash’ default clause in the driver’s auto insurance coverage to ensure it will pay for treatment of the injured person instead of high legal fees while giving the driver the option to accept cash settlements

End of Postal Code Discrimination

The budget also mentions ending postal code discrimination. Currently, insurance companies use a driver’s postal code to calculate their insurance rate. The reason is to determine the drivers who travel to or live in areas with more break-ins or higher accidents as they are at a greater risk of being involved in an accident. It has caused a difference in auto insurance premiums and sometimes has affected the scope of coverage available in certain areas. With the suggested modifications in the rules, the government aims to end this type of discrimination as this system unfairly punishes drivers who live in areas with higher accidents, irrespective of their good driving record.

There are other potential changes proposed in the budget that can alter the current state of motor vehicle accident injury cases. However, it will mostly be relevant to how insurance companies track data and how it is used for injury litigation. There are no changes to the litigation process, but your personal injury lawyer can claim for a higher amount of compensation on your behalf.

The modifications to the rules of auto insurance is a welcome change as it focuses on solving various problems for Ontario drivers. These changes will not only help lower insurance premiums overall but also provide assistance to injured people to get easy access to increased accident benefits for their treatment and care. To read the full budget, click this link or contact our personal injury lawyers in Mississauga for guidance.