2010 – Ontario Auto Insurance Changes – New Regulations

On July 14, 2010, Ontario Regulation 289/10 was filed, amending the new Ontario Statutory Accident Benefit (Ontario Regulation 34/10), effective September 1, 2010.

The key amendments include:

  1. Reverting back to allowing catastrophic impairment applications prior to the 2 year anniversary of the accident where the condition is unlikely to cease to be a catastrophic impairment
  2. Making it clear that a physician or neuropsychologist completing a catastrophic impairment assessment can be assisted by other regulated health professionals
  3. Clarifying that the cost of "preparing reports" is caught by the $2,000 assessment or examination cap
  4. Expanding the $2,000 total assessment or examination cap to expressly include "expenses".
  5. Clarifying that a "minor injury" can include more than a whiplash related complaint (i.e. more than one minor injury)
  6. Slightly narrowing the controversial definition of "incurred expenses" to persons either sustaining an economic loss or to persons who would have ordinarily, "but for the accident", been engaged in providing the goods or services as part of their "employment, occupation or profession"
  7. Expanding the definition of "qualified case manager" to include the coordination of attendant care benefits
  8. Rewording the definition of who may prepare accounting reports

Review the updated documentation:

The Financial Services Commission of Ontario (FSCO) has released the following bulletins outlining key regulatory changes:

 

 

On May 18, 2010, Bill 16, "The Creating the Foundation for Jobs and Growth Act, 2010", received Royal Assent, amending the Insurance Act, effective September 1, 2010.

Schedule 11 of Bill 16 sets out the following key amendments:

  1. The tort deductible for fatality claims has been eliminated, allowing families that have suffered a great loss to obtain increased compensation than in previous years.
  2. The calculation of tort income loss will now be based on 70% of gross income, rather than 70% of net income.

Review Bill 16

Financial Services Commission of Ontario (FSCO) Bulletin
Transition to the New Statutory Accidents Benefits Schedule - Effective September 1, 2010

With this Bulletin, the Financial Services Commission of Ontario (FSCO) is highlighting the transition rules for accident benefit claims under the Statutory Accident Benefits Schedule - Effective September 1, 2010 (New SABS).

Auto Insurance Claim Forms (OCF Forms) as of September 1, 2010

 

Overview of the Statutory Accident Benefits Schedule - Ontario Regulation 34/10 - effective September 1, 2010

Thomson Rogers recently held its first in a series of conferences on the new Ontario Statutory Accident Benefit Schedule.  The sold out conference was a tremendous success! Click on the links below to see charts summarizing the changes to the Ontario Statutory Accident Benefits Schedule, together with a comprehensive article on all of the Ontario automobile insurance changes.  Sign up today for one of the remaining conferences, where the new Ontario automobile insurance changes are discussed in detail, and various solutions are discussed in an interactive format with the audience.

Full Summary of Significant Changes effecting Health Care Professionals and Motor Vehicle Accident Victims:

Catastrophic Changes:

  1. The definition of "catastrophic impairment" has been expanded to include single-limb amputees {see s.3(2)(b)}.
  2. No ability to apply for Catastrophic designation in the first 2 years post accident pursuant to the whole person impairment test or the marked/extreme mental or behavioural disorder test, unless a brain injury is present {see s.3(5)}.
  3. Only a physician can complete an assessment or examination in connection with a catastrophic impairment determination, unless the impairment is only a brain impairment, in which case a ‘neuropsychologist’ may complete the examination or assessment {see s.45(2}.

Comments:  An expanded definition of ‘catastrophic impairment’ to cover single limb amputees is welcome. The inability to apply for Catastrophic impairment designation prior to the 2 year anniversary of the motor vehicle in cases not involving a brain injury creates a serious hardship for accident victims with significant physical and psychiatric injuries, who have exhausted the reduced non-catastrophic limits and are precluded from applying for catastrophic designation until the 2 year anniversary.

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Reduction and Elimination of Accident Benefits in Non-Catastrophic Cases:

  1. Medical and Rehabilitation benefits reduced to $50,000 (from $100,000) {see s.18(3)(a)}.
  2. Attendant Care benefits reduced to $36,000 (from $72,000) {see s.19(3)2}.
  3. Housekeeping and home maintenance benefits eliminated (was a maximum of $10,400) {see s.23}.
  4. Caregiver benefits eliminated (was $250 per week, plus $50 per dependant) {see s.13(1)}.

Comments: The reduced non-catastrophic benefits will be insufficient for serious but not ‘catastrophic’ cases.  The shortfalls in the benefits available will be shifted to the lawsuits against the at-fault drivers.  Personal Injury lawyers will expedite tort claims to ensure continuity of treatment where possible.  The elimination of access to caregiver and housekeeping benefits may result in accident victims relying more than ever on family members to provide these services without immediate compensation. 

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Income Replacement Benefit Changes

  1. The maximum of $400 per week remains; however, the calculation of the weekly amount is changed to 70% of gross income (was previously 80% of net income) {see s.7(2)1}.
  2. The cost of accounting reports to substantiate a claim for weekly benefits is capped at $2,500 {see s.7(5)}.

 
Comments: These welcome changes will simplify and reduce the cost of calculating income replacement benefits and may prove beneficial to certain injury victims.

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Accident Benefit Assessment Costs and Process:

  1. Elimination of Assessment Costs as a separate category of accident benefits, resulting in all fees and expenses for conducting assessments, examinations, and preparing reports, being paid out of the medical and rehabilitation limits {see s.18(5)}.
  2. Assessment or examination costs, including insurer examination costs (pursuant to new section 44, old section 42) are limited to $2,000 {see s.25(5)(a)}.
  3. Insurer not required to pay for any future care plan, life care plan or similar plan {see s.25(5)(b)}.
  4. Rebuttal examinations have been be completely eliminated.
  5. Attendant Care assessments only to be completed by occupational therapists and nurses who have been trained on the use of the Form 1 {see s.42(1)(b)}.
  6. In-home assessments are no longer available in cases of “minor injury” {see s.25(2)}.
  7. Adjusters have been provided with some discretion to deny benefits, assessments or treatment plans without requiring an insurer examination {see s.36(4)(b) and s.38(8)}.
  8. The time frame provided to adjusters to review assessment requests is now the same as the timeframe to respond to treatment plans, namely 10 business days {see s.38(8)}.

Comments: Since the cost of all assessments, examinations and reports will be paid out of the claimant’s medical and rehabilitation limits, accident victims in need of treatment will have less money available for treatment.  This change means that the cost of every disability certificate, Form 1 assessment, CAT application and any necessary medical assessments will be paid out of the claimant’s medical and rehabilitation benefits. These changes may serve to shift the cost of certain assessments to the claims against the at-fault driver.  Insurer examination costs and the costs of accounting reports are appropriately not to be deducted from the medical and rehabilitation limit.  Of major concern is the fact that seriously injured persons who exhaust their limited medical and rehabilitation limits will not have access to any funding to prove and apply for a catastrophic impairment designation.

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Overdue Interest

  1. The interest rate chargeable on overdue accident benefit payments by insurers has been reduced to 1% per month compounded monthly (from 2% per month compounded monthly) {see s.51(2)}.

Comments: This change reduces the penalty insurers must pay for late payment of benefits.

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Incurred Expenses and Proof of Need for Benefits

  1. New definition of ‘incurred’ requires the claimant to pay or promise to pay the expense and that the service provider be a professional service provider, or where the service provider is not a professional (i.e.  Family member) that this person has lost income in order to provide the service or is a professional service provider {see s.3(7)(e)}.
  2. Where an arbitrator or the Court rules that an expense has not been incurred because the insurer unreasonably withheld or delayed payment, then the expense may be deemed to have been incurred {see s.3(8)}.
  3. To be properly claimed, all expenses must meet the new definition of ‘incurred’—since the word ‘incurred’ is used in the following sections:  attendant care benefits {see s.19(1)}, medical benefits {see s.15(1)}, rehabilitation benefits {see s.16(1)}, caregiver benefits {see s.13(2)}, case manager services {see s.17(1)} and housekeeping and home maintenance benefits {see s.23}.

Comments:  This new definition of ‘incurred’ will preclude family members from having the flexibility to provide the necessary care to their loved ones and to be fairly compensated for providing that care.  Instead, accident victims will be forced to hire professional service providers to provide the needed care and services despite the reality that the hourly rates available pursuant to the SABS are inadequate.

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Minor Injuries

  1. Those who suffer minor injuries in car accidents (defined as a sprain, strain, whiplash associated disorder, contusion, abrasion, laceration or subluxation and any clinically associated sequelae-see s. 3(1)) would receive a maximum of $3,500 worth of treatment and assessments {see s.18(1)}.
  2. Those suffering from ‘minor injuries’ will not qualify for attendant care benefits {see s.14.2.}.
  3. Minor injury victims will not be able to have an in-home assessment conducted {see s.25(2)}.
  4. The minor injury limit of $3,500 for medical and rehabilitation benefits does not apply to an insured person if his or her health practitioner provides compelling evidence that the insured person has a pre-existing medical condition that will prevent the insured person from achieving maximal recovery from their injury, if the insured person is subject to the Minor Injury Guideline’s limited goods & services. {see s.18(2)}.

Comments:  Accident victims that fall within the minor injury definition will have extremely limited access to benefits.  In cases where the minor injury nevertheless meets the permanent and serious definition, the additional medical and rehabilitation costs will be claimed against the at-fault drivers in any lawsuits.
It is peculiar that the escape clause from the minor injury guideline appears to be limited to injured parties who have a pre-existing medical condition which delays recovery. Some injured parties simply do not recover as quickly as others, and for those people, it may be difficult to escape from the Minor Injury Guidelines.

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