Buying Car insurance

Your Finance
By Jessica Fullerton, B.A., LL.B.

Three things to consider when buying car insurance in Ontario

Most of us spend more time researching and shopping for the latest electronics and gadgets than we do when we are looking into car insurance. And when it comes to insurance, the focus is often on the monthly premiums – not what coverage is actually provided.

Unfortunately, car, cycling and pedestrian accidents happen, sometimes with devastating outcomes for ourselves or our family. Too often, we at Nelligan Law see individuals who have been involved in serious accidents and who wished they had taken more time to consider their coverage and the options available to them.

Below is some information to consider when purchasing, renewing or just reviewing your own automobile insurance.

  • Third-Party Liability Coverage – Do you have enough?

Every vehicle owner is liable for any damage or loss caused by the negligent operation of their vehicle, whether they were driving or not.  The driver will also be liable.  There are few exceptions to this rule.

Third-party liability coverage is insurance to cover these losses and compensate injured parties. Every vehicle in Ontario must have at least $200,000 in third-party liability coverage.

Most people carry at least $1 million in coverage. While that may seem like a lot of money, if there are multiple people injured in an accident involving your car, including any passengers in your vehicle or the other driver’s vehicle, or if anyone sustains a serious injury, $1 million can be used up very quickly and your personal assets and income may be at risk.

TIP: If you have assets to protect, consider asking your insurance company and broker what it costs to get liability coverage of $2 million or higher. You might also consider asking about other coverage such as an umbrella policy, which provides additional liability insurance that protects you from major lawsuits and liability claims.

  • The Value of Family Protection Coverage

There is an endorsement that can be added to automobile insurance policies called the OPCF-44R – and more generally known as “Family Protection coverage”. While it is extremely valuable, it is typically not well understood.

Family Protection coverage applies when an at-fault driver does not have sufficient insurance. In the event that you, your spouse or children who are under 18 are injured in a car accident, the OPCF-44R ensures coverage. If you have adult children away at university that are financially dependent on you, or your home remains their primary residence, it may also apply to them.

The coverage applies regardless of whether you or your family members are in your vehicle when the accident occurs. It applies to injuries sustained in any car accident regardless of whether you or your family members are the driver, passenger, pedestrian or cyclist.

The OPCF-44R coverage mirrors your third-party liability coverage. For example, if you have third-party liability limits of $2 million and the driver who causes the accident only has $1 million of liability coverage, then your OPCF-44R policy will provide an extra $1 million in coverage. That additional coverage can go a long way if you or a family member sustain serious or lifelong injuries, or if more than one family member is injured.

TIP:  Family Protection Coverage provides additional insurance and peace of mind. As noted, the amount of your OPCF-44R coverage is set by your liability limits. Even if you do not have considerable assets to protect, the question of whether to raise your liability limits to provide you and your family with generous OPCF-44 family protection coverage is a key issue to discuss with your insurance company and broker.

  • Optional No-Fault Accident Benefits – Should you purchase?

Legislation in Ontario requires drivers to pay for Statutory Accident Benefits, also known as “no-fault benefits.” They are mandatory.

Standard accident benefits are available to all drivers, passengers, pedestrians and cyclists injured as a result of the “use or operation of a motor vehicle.” The scenarios for coverage extend well beyond collisions between two cars and can include: various incidents involving pedestrians and “motor vehicles;” where a single vehicle goes off the road in bad weather; and in some cases, things like snow mobile accidents are covered.

You are entitled to benefits whether or not you cause or contribute to the accident –  hence why they’re called “no-fault benefits.” Critically, this category of benefits is available immediately following your accident and without the need to start a lawsuit to determine who is at fault.

On June 1, 2016, accident benefits were drastically reduced in Ontario. However, many of these benefits can be “topped up” at a reasonable cost and you can pick and choose which benefits to increase. This additional coverage called “optional benefits”, can be crucial following a serious accident.

Below are two of the key categories of benefits and the increases that are available.

Income Replacement Benefits (“IRBs”) Maximum coverage up to $400 per week. IRBs are particularly valuable if you do not have a long-term disability policy. By purchasing optional benefits, IRBs can be increased to $600, $800 or $1,000 per week.
Medical, Rehabilitative and Attendant Care
Covers the cost of medical treatment and attendant care needed following an accident. There are three standard tiers of coverage based on the injuries sustained:


1.  Minor injury: $3,500 (no attendant care)
2. Non-catastrophic: $65,000 over 5 years
3. Catastrophic: Lifetime limit of $1 million

Optional coverage can be purchased to increase the limits as follows:


·        $130,000 over 5 years.

·        1 million over lifetime; and

·        Increase to 2 million or 3 million over lifetime if catastrophic injury sustained.


TIP:  You can pick and choose which accident benefits to increase. With most insurers, the cost to increase some or all of your accident benefits coverage through the purchase of optional benefits is quite cost effective given the extra coverage provided.  Ask your insurance broker or insurance company for more information or a quote at any time. 

No one ever wants to be responsible for an accident or be injured in one. It is a difficult experience and not something we want to think about. However, taking care in advance to weigh your options and your coverage can make a big difference to you and your family members if you are ever in this situation.