Canada: Optional Statutory Accident Benefits: What You Need To Know

Last Updated: March 16 2012
Article by Andrew C. Murray

On September 1, 2010, a number of significant changes to auto insurance in Ontario took effect, which dramatically reduced the benefits available when someone suffers a personal injury in an automobile accident. Now, benefits that were part of the standard policy of auto insurance have been shifted instead onto a menu of numerous optional benefits, which can be purchased for an additional premium. The number of options and their complexity has increased to the point where it is even difficult for insurance brokers and agents to understand, let alone explain, all the options and when, or if, they should be purchased. It is hard to imagine the average motorist understanding what to do. Most people only realize the importance of the decisions they should have made before their car accident, after the fact, when they talk to an accident benefits lawyer, like one of the lawyers in Lerners' Personal Injury Group.

This short blog will outline the choices available to consumers.


Unless the optional income replacement benefit is purchased, anyone who suffers a personal injury in a car crash has his loss of income benefit capped at no more than $400 per week. Consumers can purchase, for an additional cost, increased optional benefits in amounts up to $600per week, $800 per week, or $1,000 per week. What the driving public must understand, however, is that, when an optional income replacement benefit has been purchased, the quantification of the benefit to be paid following an accident is still determined based on the actual income earned by the claimant prior to the motor vehicle collision. Many consumers are confused by thinking that, if a $1,000 per week benefit has been purchased, $1,000 per week will be paid following a devastating accident. If there has been a change with a job, or if the consumer has simply misunderstood how the optional benefit works, even though the additional premium has been paid, that consumer may find that he or she is entitled to something evenless than the $400 per week maximum amount that is offered as part of the standard auto policy.

It's important to remember that the auto insurance policy in Ontario is intended to be the "payer of last resort". That means, if you have some other kind of income replacement program in place, such as short or long-term disability through your work, then your auto insurance payout will be reduced by the amount of the benefit you get from your employer plan. Even high wage earning consumers might not benefit from an optional income replacement benefit if they have a generous long-term disability policy through work or by way of a private policy.

Consumers need to conduct a careful analysis of their income and the income of the other people who are likely to be covered under their auto policy, such as spouses and children, along with the existence of other income continuation insurance policies, in order to ensure that it is in fact wise to purchase one of the optional income replacement benefits. Brokers and consumers need to complete a careful annual review of the optional income replacement benefit category of accident benefits to ensure that the right option, if any, has been selected. Injury lawyers anticipate litigation developing on the improper choice of income replacement optional benefits. It is advisable to take a close look at your policy.


Prior to September 1, 2010, someone suffering a personal injury in an automobile accident, who was unable to care for his or her child, received up to $250 per week as a childcare benefit for the first child, and an additional $50 per week for each additional person in need of care (but would have to choose either income benefits or caregiver benefits, not both). This benefit was eliminated entirely, effective September 1, 2010, unless the personal injury victim suffers a "catastrophic impairment" as a result of the motor vehicle accident (which is a complex and specially defined test).

An optional benefit has now been created which must be purchased in advance, in order to pay the same caregiver benefit that was formerly part of the standard auto policy prior to September 1, 2010. The optional caregiver benefit provides for a $250 payment, as an incurred expense, if an insured person suffers a "substantial inability to engage in the caregiving activities that he or she engaged in at the time of the accident".


The optional dependant care benefit was introduced as a new option in September 2010 when the caregiver benefit was restricted to people with catastrophic injuries. Unlike the caregiver benefit, which is intended to allow you to hire someone to provide care for a family that you are no longer able to care for because of the accident, the optional dependant care benefit is essentially for working parents whose personal injuries are severe enough that they cannot look after their children. This optional coverage allows them to defray those extra child care costs.

This benefit pays $75 per week for the first dependant in need of care and $25 per week for each additional dependant, to a maximum of $150 per week. This is meant to pay for additional expenses incurred as a result of an accident that arises for the caring for the injured person's dependant, so long as the injured person:

  1. sustained an impairment in a motor vehicle accident;
  2. was employed at the time of that accident;
  3. is not electing to receive the caregiver benefit which was described above.


Prior to September 1, 2010, if you suffered personal injuries in a car crash and could not do your usual housekeeping, you would be entitled to receive payment of up to $100 per week from your insurance company to help defray the cost of having housekeeping assistance come into your home. This benefit lasted for two years from the date of your accident, at which time it was no longer payable, unless the individual suffered a catastrophic impairment in the accident. Effective with the September 1, 2010 changes, however, this housekeeping and home maintenance benefit has been eliminated, unless the claimant has a catastrophic impairment. A new optional benefit replaces the former benefit, whereby a policyholder, at an extra additional expense, can pay for the coverage that used to be part of the standard auto policy, such benefit still being limited to the 104-week time period following the onset of the disability, and a maximum of $100 per week.


Prior to September 1, 2010, all motorists enjoyed the benefit of $100,000 for medical and rehabilitation needs that might be required as a result of personal injuries sustained in an automobile accident, subject to a 10-year time period for which coverage was available. Effective September 1, 2010, that $100,000 policy limit was reduced to $50,000. It is possible to purchase an optional benefit to restore the $50,000 limit to $100,000. A new "minor injury" category was also created and coverage is limited to $3,500; however, it is not possible to purchase optional coverage to increase your coverage above $3,500. It is possible to purchase an optional medical/rehabilitation and attendant care benefit which provides for $1.1 million for medical and rehabilitation, with no time limit imposed, and a $2 million lifetime cap in the event that the person suffers a catastrophic impairment. Accident benefit lawyers foresee many auto accident victims regretting their failure to purchase additional optional medical/rehab coverage.


Although it is lumped along with the medical and rehabilitation benefit for the purposes of purchasing the benefit, the attendant care benefit is a separate benefit under the Accident Benefits Schedule. Prior to the September 1, 2010 changes, all motorists had coverage for up to $72,000 of attendant care needs during the first two years following an accident. As at September 1, 2010, that coverage was cut in half to $36,000. For an additional premium, the old coverage of $72,000 can be purchased. For a further premium, consumers can purchase an optional attendant care benefit which would provide for up to $1,072,000 in lifetime attendant care, in the event that the person did not have a catastrophic impairment, or up to $2 million if the insured person sustained a catastrophic impairment. These optional benefits can have a tremendous additional value in the event that the most serious of accidents has occurred, often for a relatively modest additional premium cost, but, of course, one always needs to go through the numbers with an experienced insurance broker or agent.


The optional indexation benefit indexes the benefits described above, such that they are not fixed or capped at the amounts otherwise specified. For example, a $1,000 optional income replacement benefit would be increased annually according to the indexation provisions, such that it would rise over time, perhaps to something significantly more than $1,000 per week. The indexation calculations are complicated and cannot be reproduced in this short blog. This is an area where a great deal of confusion could arise, even on the part of insurance brokers and agents who might not appreciate the effect that a failure to index a benefit might have on the value of the future stream of a necessary statutory accident benefit.


If someone is killed in an automobile accident, the existing death benefit pays $25,000 to the insured person's spouse and $10,000 to each of the insured person's dependants. It is possible to double those amounts, to $50,000 and $20,000 respectively, by purchasing an optional death and funeral benefit. This is one of the lowest cost add-ons that can be purchased, and, as outlined below, the most popular optional benefit.


The Financial Services Commission of Ontario undertook a survey of the largest automobile insurance insurers in Ontario in January 2011. The 24 insurance companies that were surveyed represented more than three-quarters of the Ontario market. The results demonstrate that optional benefits are simply not on the radar screen of most Ontario motorists, the statistics indicating:


This short blog is an introduction to optional benefits, and is not meant to be a substitute for a careful personal review or a meeting with your trusted insurance broker or agent. No one should simply "auto-renew" a policy without giving careful thought, each year, to the changes in life circumstances that might warrant adding or deleting one or more of the available optional benefits.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Andrew C. Murray
In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions