Regulation - LGIC
Proposed amendments to the Insurance Act, and to Ontario Regulation 34/10 (Statutory Accident Benefits Schedule) (SABS) under the Insurance Act regarding optional benefits, priority of payment for SABS medical and rehabilitation benefits, and correct an error in the French-language version of the SABS.
Regulation Number(s):
O. Reg. 34/10
Instrument Type:
Regulation - LGIC
Bill or Act:
Insurance Act
Summary of Proposal:
In the 2024 Ontario Budget, the government committed to move forward auto insurance reforms including empowering Ontario drivers with more affordable options through enabling more consumer choice and proposing changes to auto insurance payment priority for medical and rehabilitation benefits.
The Ministry of Finance is seeking feedback on amendments to the Insurance Act, and to Ontario Regulation 34/10 (Statutory Accident Benefits Schedule) under the Insurance Act, to:
1. Increase consumer choice by making all benefits outside of medical, rehabilitation, and attendant care mandatory to offer by insurers but optional to purchase for consumers.
2. Require auto insurers to pay for medical and rehabilitation expenses for injuries sustained as a result of an auto accident before these expenses are paid under a supplementary health insurance plan.
3. Amending a discrepancy in the French-language version of the SABS.
1. Enabling Consumer Choice
The mandatory auto policy is currently a one size fits all policy that provides limited optionality. Enabling greater consumer choice will allow drivers to decide what coverages are important to them and their families. This could provide drivers with an opportunity to lower their auto insurance premiums by taking advantage of a range of coverage options based on their needs.
The government will maintain mandatory auto insurance accident benefit coverage for critical coverages (medical, rehabilitation and attendant care benefits), with all other benefits becoming optional.
2. Priority of Payment
The Ministry of Finance also proposes to amend the Insurance Act, and Ontario Regulation 34/10 (Statutory Accident Benefits Schedule) under the Insurance Act, to require that expenses for medical and rehabilitation benefits are paid by auto insurers under the SABS before these expenses are paid under a supplementary health insurance plan.
Currently, the Insurance Act provides that auto insurance is excess insurance to any other insurance indemnifying the injured person. Accordingly, an insured person who sustains an impairment because of an auto accident must exhaust their supplementary health insurance plan benefits before these expenses are submitted to an auto insurer for payment. This proposal, if implemented, would reduce the risk of a consumer exhausting their supplementary health insurance plan benefits for expenses related to an auto accident. In addition, the proposed amendments are expected to simplify the SABS claims process, and reduce administrative burdens on consumers, insurers and health service providers.
The Ministry of Finance requests comments regarding these proposed amendments to the Insurance Act, and to Regulation 34/10 (Statutory Accident Benefits Schedule) under the Insurance Act.
A consultation draft of these proposed amendments to the Insurance Act, and to Regulation 34/10 (Statutory Accident Benefits Schedule) under the Insurance Act is attached.
3.French Language Discrepancy
The English-language version of Ontario Regulation 34/10 includes that an impairment is a catastrophic impairment if the impairment results in a class 5 impairment (extreme impairment) in one or more areas of function. The French-language version of Ontario Regulation 34/10 incorrectly includes that an impairment is a catastrophic impairment if the impairment results in a class 5 impairment (extreme impairment) in two or more areas of function. The proposed amendment is to correct the French language regulation to align with the English language regulation.
The Ministry of Finance is seeking feedback on amendments to the Insurance Act, and to Ontario Regulation 34/10 (Statutory Accident Benefits Schedule) under the Insurance Act, to:
1. Increase consumer choice by making all benefits outside of medical, rehabilitation, and attendant care mandatory to offer by insurers but optional to purchase for consumers.
2. Require auto insurers to pay for medical and rehabilitation expenses for injuries sustained as a result of an auto accident before these expenses are paid under a supplementary health insurance plan.
3. Amending a discrepancy in the French-language version of the SABS.
1. Enabling Consumer Choice
The mandatory auto policy is currently a one size fits all policy that provides limited optionality. Enabling greater consumer choice will allow drivers to decide what coverages are important to them and their families. This could provide drivers with an opportunity to lower their auto insurance premiums by taking advantage of a range of coverage options based on their needs.
The government will maintain mandatory auto insurance accident benefit coverage for critical coverages (medical, rehabilitation and attendant care benefits), with all other benefits becoming optional.
2. Priority of Payment
The Ministry of Finance also proposes to amend the Insurance Act, and Ontario Regulation 34/10 (Statutory Accident Benefits Schedule) under the Insurance Act, to require that expenses for medical and rehabilitation benefits are paid by auto insurers under the SABS before these expenses are paid under a supplementary health insurance plan.
Currently, the Insurance Act provides that auto insurance is excess insurance to any other insurance indemnifying the injured person. Accordingly, an insured person who sustains an impairment because of an auto accident must exhaust their supplementary health insurance plan benefits before these expenses are submitted to an auto insurer for payment. This proposal, if implemented, would reduce the risk of a consumer exhausting their supplementary health insurance plan benefits for expenses related to an auto accident. In addition, the proposed amendments are expected to simplify the SABS claims process, and reduce administrative burdens on consumers, insurers and health service providers.
The Ministry of Finance requests comments regarding these proposed amendments to the Insurance Act, and to Regulation 34/10 (Statutory Accident Benefits Schedule) under the Insurance Act.
A consultation draft of these proposed amendments to the Insurance Act, and to Regulation 34/10 (Statutory Accident Benefits Schedule) under the Insurance Act is attached.
3.French Language Discrepancy
The English-language version of Ontario Regulation 34/10 includes that an impairment is a catastrophic impairment if the impairment results in a class 5 impairment (extreme impairment) in one or more areas of function. The French-language version of Ontario Regulation 34/10 incorrectly includes that an impairment is a catastrophic impairment if the impairment results in a class 5 impairment (extreme impairment) in two or more areas of function. The proposed amendment is to correct the French language regulation to align with the English language regulation.
Analysis of Regulatory Impact:
These proposed amendments to the Insurance Act, and to Regulation 34/10 (Statutory Accident Benefits Schedule) under the Insurance Act, if approved may have limited transition compliance costs for the insurance sector relating to system changes, product development and rate filing approvals. These costs are expected to be offset by longer term savings. There is no anticipated impact on the broader Public Service or non-profit sectors.
Further Information:
Regulation (Statutory Accident Benefits Schedule)_Consultation Version - French Language Correction
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Regulation (Statutory Accident Benefits Schedule)_Consultation Version - Optional Benefits
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Insurance Act Amendment and Regulation (SABS)_Consultation Version - Priority of Payment
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Regulation (Statutory Accident Benefits Schedule)_Consultation Version - TRACKED CHANGES
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Proposal Number:
24-MOF014
Posting Date:
July 26, 2024
Comments Due Date:
September 9, 2024
Contact Address:
Financial Services Policy Division
Ministry of Finance
95 Grosvenor Street
Frost Building North, 4th Floor
Toronto, ON
M7A 1Z1
Ministry of Finance
95 Grosvenor Street
Frost Building North, 4th Floor
Toronto, ON
M7A 1Z1