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820 Automobile insurance: Overview Automobile insurance in Ontario has undergone a number of changes over the last several years. The current system came into place on November 1, 1996. This System provides a minimum level of mandatory coverage for all owners as well as the possibility for some accident victims to sue for additional compensation through the court. Although the current system is commonly referred to as a "no fault" system, "no fault" actually only applies to compensation for specific personal injury accident benefits, and not for property damage, economic loss or certain serious injuries where compensation can be obtained from the person at fault.
If you are in an automobile accident, you should begin by phoning the police. By law, you are required to report an accident that involves any injury or property damage over $1000 within seven days of the accident, unless you are injured and unable to report.
If you live in Toronto, and are in an accident that does not involve personal injury or a law violation, such as driving while your ability was impaired, you do not call and wait for the police, instead, you must bring your vehicle to a collision reporting centre to report the accident. This programme is being extended to other areas.
All automobile owners are required by law to carry a minimum level of automobile insurance. In addition to this minimum level of coverage, owners can purchase a number of optional benefits. You are required by law to purchase four types of insurance coverage, and all are included in most standard insurance policies. These are: third party liability of at least $200,000, uninsured automobile coverage, statutory accident benefits, and direct compensation for property damage coverage.
- Required coverage: third party liability of $200,000Third party liability coverage insures you in the event that the driver of your vehicle injures someone or damages someone else's property. Although the minimum is $200,000, most owners purchase liability insurance of between $500,000 and one million dollars.
- Required coverage: uninsured motoristSecond, uninsured automobile coverage insures you in the event that you are injured or your vehicle is damaged by a driver who does not have their own insurance.
- Required coverage: accident benefitsThird, statutory accident benefits provide coverage for a number of benefits in the event that you are injured or killed in an automobile accident. This coverage applies regardless of who was at fault for the accident. Accident benefits include various benefits, such as income replacement of up to $400 per week, long-term disability of up to $400 per week, medical and rehabilitation expenses, attendant care, death and funeral benefits, and benefits for non-earners such as students, caregivers, and seniors. For more information on your accident benefits, you can request a copy of the "Statutory Accident Benefits Schedule" from your insurer.
- Required coverage: direct compensation for property damageFourth, direct compensation for property damage insures you against damage to your vehicle caused by another vehicle. This insurance may have no deductible and a claim for this compensation does not affect your premiums. The amount of your compensation depends on your degree of fault as determined by the Fault Determination Rules established under the Insurance Act.
- Optional coverageIn addition to these mandatory coverages, you can purchase a number of extra types of insurance coverage, such as increased accident benefits, collision, specified perils, comprehensive, or all perils insurance.
You can purchase a variety of increased accident benefits, in addition to the mandatory statutory accident benefits. For example, you can buy coverage that will index your income replacement benefits to the cost of living. This means that if you receive benefits, the amount will increase as the cost of living increases from the time of the accident. You can also purchase coverage that will increase the maximum of your income replacement benefit from $400 to $600, $800 or $1,000 per week. You can also purchase increased coverage for medical, rehabilitation, death benefits, and benefits for caregivers.
You can purchase collision insurance, which will cover property damage to your vehicle in the event that your vehicle is in a collision with another vehicle or object. Collision is generally claimed where you are at fault, or where the damage is the fault of an unknown individual.
Third, you can purchase specified perils insurance which will cover damage to your vehicle caused by certain specified perils such as fire, theft, explosion, earthquake, lightning , and so forth.
Fourth, you can purchase comprehensive insurance which will cover damage to your vehicle as a result of things other than a collision, such as fire, lightning, theft, or vandalism, and includes the perils covered by specified perils insurance.
Fifth, you can purchase all perils insurance which offers a combination of collision and comprehensive coverage.
Innocent accident victims who were not at fault for the accident may also sue to recover certain economic losses and some non-economic losses. For more information, please refer to other sections of Legal Line .