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2023 Ushers in Further Increases to Statutory Deductibles
Inflation doesn’t only impact your grocery bills. As we ring in the New Year, the Financial Services Regulatory Authority of Ontario (“FSRA”) continues to penalize victims of motor vehicle accidents (“MVA”). Each year, the FSRA, by virtue of the Insurance Act, publishes updated statutory deductibles and monetary thresholds that negatively impact the amount of damages victims of MVAs can recover for the pain and suffering they have experienced, and each year, that amount continues to grow.
What is a Statutory Deductible?
Statutory deductibles are amounts imposed by the FSRA which an insurance company can deduct from damages awarded to you for your pain and suffering resulting from a MVA, or to deduct damages from your family member bringing forth a claim under the Family Law Act as a result of your accident. The deductible for damages for non-pecuniary (pain and suffering) damages have increased once more from $41,503.50 in 2022 to $44,367.24 in 2023, and the deductible for damages under the Family Law Act have increased form $20,751.76 in 2022 to $22,183.63 in 2023.
What about the Monetary Threshold?
The FSRA also dictates the monetary threshold required to eliminate the deductible in damages awarded to victims of MVAs. Unfortunately, like the deductible, this threshold had increased every year – in 2022 the threshold was set at $138,343.86 for non-pecuniary damages and astonishingly, this amount will increase to $147,889.59 in 2023. For damages under the Family Law Act, the threshold has increased from $69,171.36 in 2022 to $73,944.18 in 2023.
What this looks like in Practice
What this means is that if you are awarded, let’s say, $100,000 in damages for pain and suffering, you have not met the required threshold and the insurance company can deduct
$44,367.24 from your total amount, leaving you with only $55,632.76 to take home, not including legal fees.
However, if you are awarded $150,000 in pain and suffering damages, then you have met the required threshold of $147,8889.59 and therefore get to keep the full amount of your award away from the insurance company.
Importantly, the deductible and monetary threshold will apply to the year your claim is assessed, not the year you were injured. As such, if you were injured in 2022, but your damages are only assessed in 2023, then your deductible will be in the amount of $44,367.24 and not $41,503.50.
The Bottom Line
Unfortunately, many Ontarians are not aware that this deductible exists, and shockingly, lawyers are not allowed to inform jury members of the deductible at trial. This reasoning is partially because the Court does not want jury members to be swayed in awarding larger damages so that the victim of the MVA can avoid the deductible. That being said, shouldn’t our legal system be transparent towards the citizens it governs?
The insurance system if not fair towards victims of MVAs. If you are injured in a motor vehicle collision, it is important to reach out to a qualified personal injury lawyer for advice and representation as soon as possible.
Know your rights.
This article was written by Personal Injury and Equine Lawyer Louis DelSignore and Articling Student Chanele Rioux-McCormick. If you require assistance with a personal injury matter or wish to speak to a personal injury lawyer at McKenzie Lake Lawyers LLP, please call (519) 672-5666.