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WHY INVEST IN OPTIONAL BENEFITS

optional insurance benefits barrie ontario personal injury lawyer

 

The Statutory Accident Benefits Schedule (“SABS”) defines benefits available to anyone injured in a car accident, regardless of who is at fault.

Benefits are accessed through the injured party’s own mandatory automobile insurance policy, which provides this standardized level of benefits. Possible benefits include Income Replacement Benefits, Medical-Rehabilitation Benefits, and Attendant Care Benefits. The quality of the benefit is dependent on the severity of the injury, the type of benefit being claimed, and the cost of the treatment. There are, however, strict upper limits to this coverage and if your injuries exceed them, you will be left undercompensated. To avoid this issue, it may be wise to investigate the purchasing of optional benefits. All owners of vehicles in Ontario must purchase an auto insurance policy in the form of the standard Ontario Automobile Policy 1 (“OAP 1”). This policy provides access to SABs for its insureds. For an additional premium, an insured individual is given increased coverage limits for various benefits in comparison to the base SABs. In addition, an insurance provider is required to make these optional benefits available to an insured through the SABS: 28. (1) Every insurer shall offer the following optional benefits 1. An optional income replacement benefit that increases the maximum weekly amount … Statutory Accident Benefits Schedule, O Reg 34/10. [2] Increasing Limitations on Specific Benefits through Optional Benefits Section 28 of the SABS enumerates all the available optional coverages that an insured may purchase. Several examples within the provisions help to prove the difference between base coverage and the higher optional benefits: 1. Income Replacement Benefits (“IRBs”): For the first 2 years post-accident, IRBs are available to any injured party who suffers a substantial inability to perform the essential tasks of their employment (s. 5(1) of the SABS). Beyond the first 2 years post-accident, IRBs are only available if an injured party has a complete inability to perform any occupation for which they are suited by training, education, or experience. Under the base coverage, an individual entitled to IRBs can earn 70% of their pre-accident income, but only up to a max of $400 per week. Depending on the benefit purchased, optional benefits can increase this limit to a maximum to $600, $800 or $1,000 per week. When extrapolated over the course of months or years, this increase is substantial. 2. Medical Rehabilitation and Attendant Care Benefits: The limit to Med-Rehab and Attendant Care coverage depends on the classification of the injury. With the purchase of optional benefits, the majority of injuries and their Med-Rehab and Attendant Care coverage can be increased: a. Minor: The maximum is $3,500 for Med-Rehab, which cannot be increased. Attendant Care is not available within the Minor Injury Guideline. b. Non-Catastrophic: The basic maximum is $65,000, which can be increased to $100,000 or $1,000,000 depending on the premium. c. Catastrophic: The basic maximum is $1,000,000, which can be increased to $2,000,000 or $3,000,000. 3. Housekeeping/Home Maintenance and Caregiver Benefits: Normally these benefits are not available for those who are not deemed Catastrophically Impaired. However, optional benefits can be purchased with coverage that allows for Housekeeping and Home Maintenance Benefits and caregiver benefits in Non-Catastrophic cases. 4. Death Benefits: If an insured person passes away from an accident, their family is entitled to a benefit under the SABS. Generally, for spouses it is $25,000 and dependents it is $10,000. With optional benefits, this amount can be raised to $50,000 for the spouse and $25,000 for the dependants. Those who purchase optional benefits also receive an extra $2,000 for funeral expenses; raising the total to $8,000. Indexation Under the SABS, an insured also has the option to purchase indexation benefits. Indexation is a tool that adjusts benefit payments, in order to maintain its value in relation to inflation. This effectively ties your benefits to inflation to maintain its value. This is particularly helpful in the case of IRBs, which, if received over the case of multiple years, would decrease in value with inflation. Summary While premiums for optional benefits range in cost, they are generally believed to be quite reasonable in relation to the risk of being under-covered in the case of a car accident. It is advisable that an insured understand their benefits and coverages available to them, by contacting their automobile insurance representative and investigating the utility of optional benefits. For more information on the SABS, contact Littlejohn Barristers. Our Barrie personal injury lawyers can help you access your optional benefits and offer free consultations on your case. Notes [1] Statutory Accident Benefits Schedule, O Reg 34/10, retrieved on 2019-11-08 [2] Ibid.

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