We are pleased to provide you with the following documents to review:
Mail Service Disruption
If there is an interruption of mail service, we will send any documents electronically to the email address we have previously been provided. Please print off your liability slip and keep it with you when driving as an electronic slip is currently not acceptable in Ontario. If you wish us to use a different email address or have not provided us with an email address please contact our office.
The interruption of mail service will not negate your payment of your insurance policy by the due date. If you currently have your payments being automatically withdrawn from a financial institution, or paid by credit card, this will continue as usual. If you need to make a payment by mail, we recommend an alternate method be used to ensure there is no lapse in your insurance coverage. Please drop by our office to pay by cash, cheque, or debit, or contact us for instructions if you wish to use internet money transfer services. If you do not wish to have documents sent by email during the interruption, please call us with your instructions to either hold your documents for pickup or to send after the interruption is over. To pick up mail from our office, please bring your photo driver's license for identification purposes.
Once the interruption is over, we will send your original documents via the regular postal service. We apologize for any inconvenience and trust that you will agree to receiving emails as a primary source of contact during this time. Thank you.
AUTO REFORM CHANGES AS OF JUNE 1, 2016
If you own a vehicle in Ontario, you are required by law to purchase coverage in case an accident occurs. At a minimum, you must carry third-party Liability, Accident Benefits, Direct Compensation Property Damage, and Uninsured Automobile. You have the option to increase limits and purchase additional Accident Benefit coverage to protect your lifestyle.
In order to control the cost of automobile insurance in Ontario, the Financial Services Commission of Ontario has enacted legislation that significantly changes the Accident Benefits section of your policy. If you are injured in a car accident, regardless of who has caused it, accident benefits cover expenses not covered by OHIP or Group Insurance Plans.
The legislation made changes to the Medical and Rehabilitation benefit which is the reimbursement for reasonable, necessary medical and rehabilitation expenses like physiotherapy. The legislation also changed the Attendant Care benefit which is the reimbursement for an attendant to look after you either at home or within a healthcare facility.
Effective June 1, 2016 the legislation combined these two benefits into a single benefit and reduced the standard coverage. Therefore, new policies and existing policies upon renewal will have substantially reduced standard coverage for these benefits. The reimbursement limit for the benefit is based on the severity of the injury.
Non-Catastrophic Injuries
The Standard Medical and Rehabilitation Benefit was previously $50,000
The Standard Attendant Care benefit was previously $36,000
Total Previous Standard Benefit was $86,000
The New Standard Combined Benefit for Medical, Rehabilitation and
Attendant Care for Non-Catastrophic Injuries is $65,000
You can purchase increased limits. Please see options in the chart below.
Catastrophic Injuries
The Standard Medical and Rehabilitation Benefit was previously $1 million
The Standard Attendant Care benefit was previously $1 million
Total Previous Standard Benefit was$2 million
The New Standard Combined Benefit for Medical, Rehabilitation
and Attendant Care for Catastrophic Injuries is $1 million
You can purchase increased limits. Please see options in the chart below.
Non-Catastrophic & Catastrophic Injuries
This is a new Optional Benefit that previously was not available. This option is available to increase the benefit for both Non-Catastrophic Injuries and Catastrophic Injuries. You can purchase this option. Please see chart below.
There are 6 possible OPTIONS for the combined Medical, Rehabilitation and Attendant Care benefit as follows:
6 COVERAGE OPTIONS |
DESCRIPTION |
NON-CATASTROPHIC |
CATASTROPHIC |
1 |
STANDARD Benefit – no additional premium |
$65,000 |
$1 million |
2 |
Increase non-catastrophic |
$130,000 |
$ 1million |
3 |
Increase catastrophic |
$65,000 |
$2 million |
4 |
Increase Non-catastrophic |
$1 million |
$2 million |
5 |
Increase Non-catastrophic |
$130,000 |
$2 million |
6 |
Increase Non-catastrophic |
$1 million |
$3 million |
OTHER IMPORTANT ACCIDENT BENEFIT CHANGES INCLUDE:
For non catastrophic the duration for accessing these benefits has been shortened from 10 years to 5 years, except in cases involving children (under 18 at time of accident) where claims can be made until the claimant’s 28th birthday).
Please be aware that the Government has also revised the definition of “catastrophic impairment”. A number of new tests have been introduced in support of the new definition. If you suffer catastrophic injury (loss of limb/quadriplegic) from a car accident or if you suffer a non catastrophic injury (broken bones, severe strains, soft tissue) the Government has reduced the amounts covered under the Standard Benefit. The Medical, Rehabilitation and Attendant Care benefits for Minor injury (sprains, whiplash)are limited to a maximum of $3,500 and has not changed under this legislation. The other Accident Benefits components have not been changed by this Legislation apart from the Tort Deductible which is now indexed.
The legislation also made other important changes to your policy:
Non-Earner Benefit
The new legislation, applicable to claims arising from accidents on or after June 1, 2016, reduces the duration of eligibility for non-earner benefits from “life” to a maximum duration of 2 years (while replacing the 6 month waiting period that currently applies with a 4 week waiting period). Those that were about to enter or re-enter the workforce will now only be eligible for weekly benefits totalling $18,500 over their lifetime ($185/week for 2 years, other than during the first 4 weeks) instead of a lifetime of access.
Changes to Tort Deductible
As of January 1, 2016 the deductible (if applicable) will be adjusted in accordance with an indexed percentage stipulated in the Insurance Act. Presently this deductible is $39,754.31 for the insured. On January 1 of every subsequent year, the prescribed amount of the deductible will be revised according to the indexation percentage of the Insurance Act for that year. The Tort deductible buy down option reduces the deductible by $10,000.
Comprehensive Deductible
The standard deductible for Comprehensive coverage has been increased from $300 to $500
Minor Accident
Insurers can no longer use a minor at-fault accident (under $2,000 damages to either vehicle) subject to certain criteria, to increase your premiums. This applies to accidents occurring on or after June 1, 2016
Interest Rate for Monthly Payments Plans
The maximum that can be charged for monthly premium payments has been lowered to 1.3% for one year policies with corresponding reductions for shorter terms.
Dispute Resolution
FSCO has been removed from the Accident Benefits dispute resolution process and is replaced by the Licensing Appeal Tribunal which is part of the Ministry of the Attorney General. Mediations and lawsuits will no longer be available over denied accident benefits.
Depending on your lifestyle, you should consider purchasing increased optional Accident Benefits if any of the following apply to you:
Is your Income close to |
Consider an IRB |
|
What is the appropriate Income Replacement Benefit Limit? |
$30,000/year? |
$600/week |
|
$45,000/year? |
$800/week |
|
$60,000/year? |
$1,000/week |
Unfortunately, until you have an accident, you do not realize how important these Accident Benefits are. It is our recommendation that you evaluate purchasing increased Accident Benefits coverage if your Financial Situation changes and especially if you do not have other forms of coverage eg you have changed Employers and no longer have a Group Plan.
DISCLAIMER: This a summary of the amendments only and should not be relied upon to be exhaustive. For a list of all amendments please go to: http://www.fsco.gov.on.ca/en/auto/autobulletins/pages/default.aspx
ECONOMICAL DEMUTUALIZATION
Economical has begun the process to demutualize the company. This is a financial process that may take up to two years or more to complete. If you are an Economical policyholder we strongly recommend that you review the material mailed to you directly by Economical. Further information on the demutualization process can be obtained by calling Economical at 1-866-302-6046, by visiting the Economical website at www.joininourfuture.com or by visiting the Office of the Superintendent of Financial Institutions (OSFI) website at www.osfi-bsif.gc.ca/Eng/fi-if/app/aag-gad/Pages/demu-MPCIC.aspx.
As your broker, we shall continue to provide all insurance related services for your Economical policy. Please note that we are unable to comment on the Financial Details of the Demutualization
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