Insurers still dealing with claims from before Ontario’s auto insurance reforms

Published: August 9, 2018



Reforms made to the auto insurance system in Ontario launched two years ago to change the definition of catastrophic impairment. However, despite the change, insurance companies are still dealing with the previous model. Indeed, the country’s largest auto insurance provider says many claims are still open from the previous cat definition.

“Clearly, people are trying to get as much as they can from their claims before the new regime, but there is a limit to that as we close more and more of the files from those prior years,” Intact Insurance CEO Charles Brindamour said recently when announcing the company’s Q2 earnings.

Brindamour was referencing the reforms introduced in August 2015. A catastrophic impairment was previously considered to be any injury that impairs a person’s life moving forward, such as a loss of limb or eyesight.

“New and/or updated definitions and criteria for traumatic brain injuries for adults and children, amputations, ambulatory mobility, loss of vision, and mental and behavioral impairments, and introduces a new process for combining physical with mental and behavioral impairments," FSCO said in 2015.

Drivers in Ontario were previously obligated by law to carry car insurance that covers up to $1 million for injuries and recovery that fall under the definition catastrophic impairment, this is included as a benefit in all basic insurance policies. Likewise, attendant care coverage to $1 million is also mandatory in the province.

"A new optional benefit for catastrophic impairment of up to an additional $1 million for medical, rehabilitation and attendant care will be available, if the insured person sustains a catastrophic impairment. The current optional $100,000 medical and rehabilitation benefit and $72,000 attendant care benefit have been eliminated."



The number of previous development claims is “actually very small … but a claim for catastrophic impairment is worth $1 million or more,” said Brindamour. The CEO says he believes the situation is something other insurance companies are experiencing.