Crash Course: What You Need to Know About Changes to Your Ontario Automobile Policy  

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  Catherine Shearer
  Partner

This article was originally published in Guelph Today.

If you’ve ever been in a car accident in Ontario, you’re probably familiar with the Statutory Accident Benefits Schedule or SABS. It’s a set of mandatory benefits included in every auto insurance policy, covering things like income replacement, medical rehabilitation, and even caregiver benefits, if you need them.

Many of these benefits have been gradually reduced over time, and now, as of July 1, 2026, what you need to know about changes to your Ontario automobile policy is that most accident benefits will become optional, moving to an à la carte system. Catherine Shearer, Partner and Personal Injury Lawyer at McKenzie Lake Lawyers in Guelph says, “I’ll bet if you ask people on the street, they don’t know what accident benefits are.”

From Automatic Coverage to Optional Choices

This shift away from mandatory to more optional benefits, requires consumers to actively choose to purchase these optional benefits, rather than simply opting out of them.

The only mandatory benefits will be medical, rehabilitation, and attendant care benefits. Shearer stresses, “Consumers need to be well-informed about the changes and the implications of choosing different benefit levels. It could lead to lower premiums for some, but it could also leave consumers with critical gaps in coverage. It’s not until you need benefits that you become aware that not having them is a problem.”

While the industry claims the à la carte system will reduce insurance premiums, it’s more likely to create critical gaps for lower income people who are looking to save money on car insurance.

What Happens When Injury Takes Away Your Income

One of the most significant changes relates to the Income Replacement Benefit. Today, if you’re injured in a car accident in Ontario, you’re entitled to up to $400 a week in income replacement benefits, no matter who was at fault. You can even bump that up to $1,000 a week if you purchase extra coverage. But under the new rules, that safety net disappears unless an individual pays extra to opt-in.

The biggest risk is for individuals not covered by an employer disability plan. Shearer points out, “Even if you have short-term disability benefits, some company plans exempt motor vehicle accidents. Many people assume that because the have short-term disability coverage, they don’t need additional accident benefits covered by their vehicle insurance policy.”

Lack of awareness of the changes is a huge risk. Shearer adds, “Many people won’t realize they’ve opted out of income protection until they are injured in an accident, when it’s already too late.”

Caregiver and non-earner benefits are also becoming optional. These are benefits that will support students, stay-at-home parents, caregivers, or unemployed individuals. The changes will also disproportionally impact self-employed individuals, gig workers and small business owners, many of whom lack comprehensive disability or business interruption coverage.

It Won’t Happen to Me

No one gets into a car expecting to be involved in a serious collision. The injury itself is shocking, but so in the financial reality that follows. Income replacement benefits capped at $400 a week is hardly enough to cover everyday expenses. But when automatic income replacement disappears next year, it may leave many people exposed. Shearer says, “We don’t want to see someone injured in an accident saying that we didn’t know these changes happened. We thought we were covered and now we don’t have any income to buy groceries or pay the rent.” A catastrophic car crash could also leave underinsured victims facing large out-of-pocket expenses.

To reduce the risk, Catherine Shearer recommends purchasing income replacement benefits, which could also top up your long-term disability benefits if you have LTD coverage. She also advises raising the limits on other benefits. “We always recommend increasing liability limits to $2 million or higher and to buy higher medical and rehabilitation limits.”

Don’t Leave Your Protection to Chance

When speaking to your insurance broker about purchasing benefits, ensure that you are well-informed. While many people make decisions about coverage based on the cheapest rates, they should look for a premium that offers the best protection while being affordable. Shearer stresses, “Knowing what you’re covered for today, and what may disappear tomorrow is critical. An informed conversation with your insurance provider can help you identify those gaps and secure the right protections.”

Get the Support You Deserve

If you’re injured in a motor vehicle collision, having an experienced personal injury lawyer like Catherine Shearer in your corner can make all the difference. She will protect your rights and work to ensure you receive the care and benefits you need to recover.

She will guide you through an overwhelming process with clarity and confidence and support you every step of the way. The initial consultation is free of charge.

Contact Catherine Shearer at catherine.shearer@mckenzielake.com or call (226) 203-1243. Learn more about McKenzie Lake Lawyers here.