During the Spring 2014 sitting of the legislature, the PEI
government passed legislation that will result in significant
changes to the standard automobile policy, effective
October 1, 2014. Most notably, the amended
Increase no-fault accident benefits (i.e. Section B
Increase the "cap" on minor personal injuries.
Make significant changes to the definition of "minor
The government has also laid the groundwork for a shift to
direct compensation for property damage, although direct
compensation is not expected to come into effect until sometime in
1. Increase in No-Fault Accident Benefits
No-fault accident benefits available under the PEI standard auto
policy are set to increase significantly, mirroring those in New
Brunswick. The following benefits will apply to motor vehicle
liability policies issued or renewed on or after October 1,
2. Changes to the "Cap" for Minor Personal
The "cap" on non-pecuniary general damages for motor
vehicle accidents occurring on or after October 1, 2014 is set to
increase to $7,500 – up from the current
amount of $2,500. The existing cap of $2,500 will continue to apply
to accidents occurring prior to October 1, 2014.
The cap will also be indexed cumulatively in January of each
year, beginning in 2016. The maximum recoverable amount will be the
amount in place on the date of the accident.
3. Changes to the Definition of "Minor Personal
The amended legislation will not only increase the amount of the
"cap" for accidents occurring on or after October 1,
2014, but will also restrict the definition of "minor personal
injury" to sprains, strains and whiplash-associated disorders
that do not result in a serious impairment. This is a significantly
more narrow definition than currently exists in PEI.
The amended legislation also provides guidance on matters
relevant to the determination of "minor personal injury",
the assessment of multiple injuries, and the impact of a
claimant's failure to follow reasonable treatment advice.
4. Direct Compensation for Property Damage
Although not yet in force, direct compensation for property
damage is expected to be in effect sometime in 2015. Fault
determination rules have not yet been prescribed.
What This Means For You
Greater benefits will be available for accidents occurring on or
after October 1, 2014. These changes may result in new strategic
considerations in the defence of auto-related personal injury
claims in PEI.
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.
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