Protecting Yourself: Ensure You Have the Insurance Coverage You Need
In the aftermath of recent cutbacks to car insurance coverage in Ontario, it’s more important than ever to make sure you have the protection you need in case your or a member of your family is involved in a car accident.
There are a number of options you can add to your insurance policy to enhance the coverage available to you. Purchasing the right mix of optional benefits for you and your family will ensure that the insurance you pay for actually provides the protection you need.
- Everything You Need to Know about the New Car Insurance Cutbacks
- 4 Questions to Ask Your Broker Before Renewing Your Auto Insurance
Increasing your Coverage for Medical and Care Costs
For medical and attendant care costs, the new 2016 basic coverage amounts have been reduced from $86,000 to $65,000 for most injuries, and from $2 million to just $1 million for the most serious, "catastrophic" injuries.
If you suffer significant injuries in a car accident, it's very easy to exceed these new reduced amounts. Fortunately, you have several options to increase the medical and attendant care coverage available to you by purchasing optional extra coverage:
OPTION 1: Increase basic (non-catastrophic) coverage
Increases the basic coverage for non-catastrophic injuries from $65,000 to up to $130,000.
OPTION 2: Increase catastrophic coverage
Restores your catastrophic coverage from $1 million back to the $2 million that was standard before the cutbacks.
OPTION 3: Increase both catastrophic and non-catastrohpic coverage
Increases your non-catastrophic coverage from $65,000 to $1 million, and restores your catastrophic coverage to $2 million.
OPTION 4: Combine Option 1 + Option 2
Increases your non-catastrophic coverage to $130,000 and increases your catastrophic coverage to $2 million.
OPTION 5: Combine Option 2 + Option 3
Increases your non-catastrophic coverage to $1 million and increases catastrophic coverage to $3 million.
Other Options for Increasing Your Insurance Coverage
Unfortunately, not all of the new cutbacks can be compensated for by purchasing additional optional benefits. However, there are a number of other optional add-ons that you can purchases to enhance the coverage available to you if you are involved in an accident.
Increasing Income Replacement Benefits
If you lose income because of your injuries, income replacement benefits from your car insurance will compensate you for up to 70% of what you earned before the accident, but only up to a maximum of $400/week.
If you earn more than that, you can optionally increase your maximum coverage to $600, $800 or $1,000/wk.
Purchasing Caregiver, Dependant Care and Housekeeping Benefits
Unless you suffer "catastrophic" injuries, your basic insurance coverage does not provide compensation for housekeeping and home maintenance expenses that you may have to incur because of an accident, nor will it pay for hiring assistance to help with the caregiving activities you engaged in before the accident.
If you are a primary caregiver of someone living with you, or if you provide the majority of housekeeping services in your home, you may want to purchase these optional benefits to ensure this funding is available to you even if your injuries are not catastrophic.
Increasing Liability Coverage
If you are at-fault for an accident that injures someone else, you might get sued to compensate them for their losses. The liability coverage you purchase from your own insurance company protects you in case you get sued, but only up to a certain amount. If you get sued for damages that exceed the limit of your liability coverage, you could be personally on the hook to pay for the difference.
As our car accident benefits continue to get cut, more and more compensation for injured people will have to be recovered through lawsuits instead of from our own insurance. As lawsuits get more expensive, you'll want to make sure you have enough protection from your own insurance company in case you ever get sued.
Every driver in Ontario is required to have a minimum of $200,000 in liability coverage, but most people have $1 million in protection. Talk to your insurance broker or agent about whether you should increase your liability limits to $2 million, or in some cases even higher.
Increasing your liability limits also protects you if you are injured by a driver who doesn't have enough insurance coverage themselves to fully compensate you for your own losses. If you have higher liability limits than the person who injured you, you can 'top up' the coverage that's available to you by recovering the rest from your own insurance company.
If your basic coverage doesn’t give you the protection that you need, then it may be a good idea to enhance the coverage your car insurance premiums are paying for. Additional coverage is often not expensive, and when you consider the extra protection you are getting, these increases can be well worth the cost.
Talk to your insurance broker or agent to explore which options make sense for you.