Lack of Knowledge About Auto Insurance Continues to Hurt Ontario Drivers
The Deutschmann Law Annual Survey on Ontario Auto Insurance reveals that Ontario drivers are becoming slightly more aware of optional coverage, but drivers continue to be insufficiently protected particularly when it comes to medical benefits and income replacement benefits.
The third annual survey from Deutschmann Law looked at optional coverage, the deductible for general damages and included questions regarding close calls, auto safety features and roundabouts.
The Deutschmann Law Survey reveals that 10 years after the introduction of optional benefit coverage, 30% of drivers are still unaware of the opportunity to purchase optional coverage. This has increased from 25% of drivers in 2017.
In 2010 accident victims had their medical and rehab benefits reduced from the basic coverage of $100,000.00 for everyone, to $3,500.00 for almost 80% of accident victims with the option to purchase additional coverage for medical and income benefits.
While people are aware of the availability of optional coverage, only 8% have purchased additional coverage. Of those, increased libility coverage was the most popular (71%) followed by increased medical coverage (50%) and then increased weekly income replacment benefitss (16%).
Though 75% of people were aware of a deductible that applies for property damage, only 52% were aware of a deductible for pain and suffering damages. The deductible is currently $38,818.97. However only 10% of those surveyed felt that the deductible is over $10,000.00. That means that where an injured party is awarded $50,000.00 for pain and suffering then the at fault insurer will only have to pay $11,181.03.
Only 25% of respondents feel there should be a deductible for pain and suffering damages.
The deductible for pain and suffering damages increases by the CPI rate annually, further eroding damages payable to innocent victims. Contrast that to rate payable by the insurer for income benefits (maximum $400.00 weekly) which has stayed stable since 1990, unless optional coverage is purchased.
“Our third annual survey shows that consumers in Ontario are not sufficiently informed about auto insurance including the availability of enhanced medical and income benefits and the erosion of damages when they are involved in an accident. There needs to be better education so consumers can make more informed decisions about their insurance and avoid becoming a victim twice – at the time of the accident and then realizing how their benefits do not sufficiently deal with their needs,” says Rob Deutschmann.
For those respondents that have been involved in a “close call” while driving, 87% identified that there was another vehicle involved and 11% with a bicycle or pedestrian. 45% identified speed as the biggest cause while 38% identified distracted driving and 25% identified improper turns.
The independent survey, conducted in September 2019, was administered by Metroline Research Group on behalf of Deutschmann Law. Over 800 Ontario licensed drivers between the age of 18 -74 participated. All were identified as decision-makers regarding their auto insurance policy.
I'll be writing more in depth articles in the coming weeks on the importance of additional coverages when you do have an accident. Please share the article and the news with your friends!