Accident Benefits vs Tort Claims in Motor Vehicle Accidents – What you need to know!

In 2018, there were nearly 9,500 serious injuries sustained in motor vehicle accidents across Canada.

The number of serious injuries resulting from car accidents has been steadily declining over the last few years. But, when they do occur, victims are entitled to various benefits and compensation – and that’s true whether the injuries are serious or not.

Exactly what you’re entitled to will depend on everything from your specific injuries and damages to whether or not you were at fault for the accident. Complicating the matter even further is the distinction between accident benefits vs tort claims.

What Are Accident Benefits?

Statutory accident benefits Schedule (SABS), often referred to as accident benefits, are a form of no-fault insurance. Meaning, these benefits are available to everyone involved in a car accident in Canada, regardless of who was responsible for causing the accident.

Accident benefits provide a variety of benefits geared towards your recovery, such as medical and income replacement benefits. These benefits are claimed through your insurance provider immediately following an accident.

Available Benefits and Damages

The intention behind no-fault coverage and the provision of accident benefits is to provide immediate coverage, care, and support to those physically and/or psychologically injured in a motor vehicle accident.

What you receive in accident benefits depends on the seriousness of the injury. In general, accident benefits cover:

  • Income Replacement: 70% of your gross income up to a maximum of $400.00 per week
  • Non-Earner: $185.00 per week, typically for students and individuals who have not been working in the 26 to 52 weeks prior to the accident
  • Child Care: up to $250.00 per week for a first child and $50.00 per week for additional children
  • Medical and Rehabilitation: from $3,500.00 to $1,000,000.00, depending on the severity of the impairment
  • Death: includes $25,000.00 for spouses, $10,000.00 for dependents, and up to $6,000.00 in funeral cost reimbursement
  • Housekeeping: up to $100.00 per week for catastrophically impaired individuals
  • Other benefits: includes loss of educational expenses, loss of prescription glasses, and even travel expenses for family members that assist with recovery

It’s important to note that some of these benefits, such as additional child care expenses, must be part of your insurance policy in order to receive them. And, while some of the benefits are available to all policy holders, you should know the details of your own insurance policy and what it includes.

What Are Tort Claims?

To pursue a tort claim in Ontario, your physical and/or psychological injuries must be of a permanent and serious nature. According to Section 267.5 of the Insurance Act, the injuries must be considered a “permanent, serious disfigurement or a permanent serious impairment of an important physical, mental or psychological function”. They also have to be the specific result of your motor vehicle accident.

Tort claims operate outside of your insurance policy and are claimed against the tortfeasor or at-fault party’s insurer. When you pursue a tort claim, you may be able to resolve your claim directly with the third party insurer’s representative, known as a bodily injury adjuster. In the case that you’re unable to resolve your claim at the ‘adjuster level’, you must file a lawsuit against the negligent party responsible for the accident – and you must do so prior to the two year limitation of when the accident or negligent act occurred. 

Available Benefits and Damages

Whereas accident benefits are intended to provide a minimum amount of coverage, a tort claim is intended to put you in the same financial position you would have been had the accident not occurred. The purpose of this claim is to compensate you for pain and suffering (also known as general damages), past and future economic losses, future medical care costs, and housekeeping.

Following an accident, your family may also be entitled to compensation. Under the Family Law Act, your family can initiate claims that help them through pain and suffering as well as loss of care, guidance, and companionship.

The Interaction Between Accident Benefits and Tort Claims

In 2018, two important court cases at the Ontario Court of Appeal enunciated what is now known as the “silo approach”. Should a victim be involved in a motor vehicle accident and claim accident benefits as well as pursue a tort claim, the silo approach informs exactly how much compensation they can receive from both.

Under this approach, accident benefits that are available to the victim may be deducted from tort awards for corresponding damages. For example:

  • Income replacement received and available through accident benefits will be deducted from loss of income damages received through tort claims
  • Medical and rehabilitation benefits, attendant care benefits, and housekeeping benefits received and available through accident benefits will be deducted from medical expenses received through tort claims
  • Past and future losses received and available through tort claims will be aggregated in order to calculate the accident benefits deduction

While each accident benefit silo doesn’t exactly correspond with tort claim damages, your lawyer can help you determine what to claim as well as estimate what you will receive.

Pursuing Accident Benefits and Tort Claims

Pursuing accident benefits and tort claims is never an easy process. Paper work, medical investigations, and navigating the accident benefits and tort regimes are a complicated and time consuming task. 

It’s good practice to consult a personal injury lawyer who knows what you should be receiving and who will fight for your right to receive it. And, whether or not you were at fault in a motor vehicle accident, you’re entitled to access benefits through your automobile insurer.

Victims of motor vehicle accidents who are seriously injured should pursue both – but knowing how and where to start can be difficult, especially in the traumatic time following an accident. At Sharma Law, we take care of all that and more. Contact us today to schedule a free consultation.

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