Toronto Injury Lawyer Blog
There are a lot of things which non personal injury lawyers don’t know about car accident cases in Ontario. Heck, even some lawyers who don’t practice in the area of car accident cases don’t even know. These are dirty little secrets which aren’t advertised with much fanfare. But, if you do a bit of research, you can learn pick up a few pearls of knowledge here and there.
Every year around this time, the Financial Services Regulatory Authority of Ontario (FSRA) makes a very under the radar announcement, if you can really call it an announcement at all. Basically, they update a page on their website to post new deductible rates for the upcoming new year.
These deductible rates are important for car accident cases. The deductible rates have nothing to do with the physical damage to your vehicle. Nor, do you get to set the deductible by paying a higher insurance premium. This seems very odd, because under all car insurance policies, and under the vast majority of insurance policies, the consumer can pay more premiums to reduce a deductible and potentially reduce it to zero.
But not for pain and suffering claims in car accident cases. The deductible is pre-determined and uniform across the board. It cannot be eliminated, not matter how much you pay in car insurance premiums. The consumer is completely powerless, and at the will of the government along with the insurance industry.
You see, long ago insurers lobbied the government to introduce a deductible for pain and suffering claims as a result of a car/motor vehicle accident. The deductible was intended to reduce the exposure for insurers, in order to pass potential savings to motorists in order to keep car insurance premiums down. The deductible remained at the same level for many years, until the insurance industry was again successful in getting the deductible increased year, after year in accordance with inflation. You don’t see the insurance industry pushing for changes to benefits year after year in accordance with inflation. But for deductibles, which present millions of dollars in savings to their industry, they will push hard. And the government was all too eager but to listen and to comply with their demands.
So, when examining this deductible for 2025, the following changes have been made. Beginning January 1, 2025, all pain and suffering cases arising from a motor vehicle accident which are valued at below $155,965.54 will be subject to a deductible of $46,790.05 (almost $47,000!)
Let’s pretend that you’ve been involved in a bad car accident. The other driver was drunk, texting and ran a red light as well.
The at fault driver, regardless of their degree of fault, is protected by a $46,790.05 security blanket if the damages for pain and suffering do not exceed $155,965.54.
It’s an example of the legal protections which are extended to at fault drivers at the expense of innocent accident victims in order to save large insurance companies a lot of money. At Goldfinger Injury Lawyers, we call the deductible for pain and suffering claims the secret credit. We call it a secret credit because it’s a very public secret! Injured Accident Victims and their families don’t know about it until their personal injury lawyer explains to them how car accident law works in Ontario. Should the case go to trial, the deductible is NOT allowed to be discussed or mentioned to the jury either. That’s why insurance companies love jury trials. It’s because the jury is uneducated when it comes to the application of the deductible. If a Jury awards a Plaintiff $100,000; and the same Jury wants the Plaintiff to get $100,000; they will order that the Defendant pay the Plaintiff $100,000. But, once the Jury makes that decision, the Judge will then reduce that $100,000 figure by the statutory deductible of $46,790.05 resulting in a net award to the Plaintiff of only $53,209.95. Nearly 47% of the Plaintiff’s $100,000 has vanished thanks to the application of the statutory deductible, representing a 47% savings to the insurance company on the general damages award in that case example.
When you spell things like this out to a person who is not familiar with how car accident law works in Ontario, they would be quick to tell you that it’s either made up, exaggerated, or if it’s true, then it’s not fair. I can tell you that none if this is made up. All of it is true as seen given that it’s the law, and none of it is fair. There is no way for even the wealthiest driver to avoid the $47,000 deductible. The only way of doing so is by ensuring that the damage award for pain and suffering exceeds the $155,965.54 threshold such that the deductible would not trigger. In order to exceed that threshold, the injuries need to be really bad and they need to have a serious impact on one’s quality of life and ability to function/carry out their regular activities of daily living. It’s very difficult for a soft tissue injury alone to exceed this monetary threshold.
Speaking of the threshold, that’s another dirty little secret for car accident cases in Ontario. In order to sue of pain and suffering and win; regardless of the Defendant’s degree of negligence; the injuries must meet a medico-legal test known as the threshold. Think of this threshold as being the “serious and permanent” test. Do the Plaintiff’s injuries present a “serious and permanent impairment” or an important function in the Plaintiff’s life? If so, then the threshold test is met. If not, the the Plaintiff fails the test and the damages for pain and suffering won’t get awarded to the Plaintiff at all. This is another example of a greater degree of protection being afforded to an at fault Defendant, at the expense of the welfare of the innocent accident victim who was simply in the wrong place, at the wrong time. It has always dumbfounded me that in a Court, the laws are skewed in such a way as to protect the Defendant. There are no comparable laws which give a Plaintiff any sort of advantage akin to the threshold and the deductibles which we discussed to winning a car accident case in Ontario.
