“No-Fault” Insurance – What does it mean for car accident victims?

There has been a lot of talk in the media lately about ICBC switching to a “No-Fault” system, and what this would mean for people who pay for car insurance in British Columbia. In particular, people have been concerned with how a “No-Fault” system might impact someone injured in a car accident.  

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So, what does a “No-Fault” car insurance system mean? This system is in place in other Canadian provinces, such as Ontario and Manitoba. In Ontario, you are only entitled to sue for compensation when you meet the threshold of having suffered a “permanent serious impairment of an important mental, physical or psychological function.” This means that unless you had something “significant,” like a spinal cord injury, you would likely be prevented from getting adequate compensation for your “pain and suffering.” For example, in Ontario, if you were hurt with significant soft tissue injuries, the compensation would usually be limited or non-existent. On top of that, in Ontario, there is a “deductible” that anyone would have to pay before they could even get money from the insurance company. If your claim was worth $100,000 or less, you must pay a deductible of $30,000. This means that the majority of people injured in car accidents are likely shut out of compensation altogether. As anyone can imagine, “no-fault” usually means the insurance company wins, while the customers who pay for insurance loses. 

In our current legal system in British Columbia, when someone is injured in an accident, the victim has a right to be compensated. This is true even if their injuries are “soft tissue” in nature. This is great for most victims, as many injuries are muscular/soft tissue. Thus, in BC, you can get your treatment covered, your lost wages paid, and receive money for your pain and suffering without having to pay a $30,000 deductible, and without having to prove you have something like a spinal cord injury. You have a legal right to be cared for/compensated under current BC law. 

ICBC is trying to argue that a “no-fault” system will save everyone in the province money on their insurance, as they won’t be paying out as much for compensation for car accident injuries. But the cost would be extremely high to injured people in B.C. if we had a “no-fault’’ system. Many injured parties would not be compensated for their pain and suffering, full wage loss and full treatment costs, even if their life had been greatly impacted by an accident.

Thankfully, the new NDP government in British Columbia has rejected the idea of establishing a no-fault system of insurance in the province at this time. This means that the current system, where injured parties have the right to sue for damages, when they are injured in a car accident, no matter how significant, remains in place.

Vancouver ICBC Claims Lawyer 
10+ years ICBC injury claim settlement experience:
No fees until you get paid
Call us today for a free consultation, 24 hours – 7 days a week 604-684-4300

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