Client Update: PEI Auto Insurance Reforms: Change is Coming
No really. We mean it this time.
During the Spring 2014 sitting of the legislature, the PEI government passed legislation that will result in significant changes to the standard automobile policy, effective October 1, 2014. Most notably, the amended legislation will:
- Increase no-fault accident benefits (i.e. Section B benefits).
- Increase the “cap” on minor personal injuries.
- Make significant changes to the definition of “minor personal injury”.
The government has also laid the groundwork for a shift to direct compensation for property damage, although direct compensation is not expected to come into effect until sometime in 2015.
- Increase in No-Fault Accident Benefits
No-fault accident benefits available under the PEI standard auto policy are set to increase significantly, mirroring those in New Brunswick. The following benefits will apply to motor vehicle liability policies issued or renewed on or after October 1, 2014:
- Changes to the “Cap” for Minor Personal Injury
The “cap” on non-pecuniary general damages for motor vehicle accidents occurring on or after October 1, 2014 is set to increase to $7,500 – up from the current amount of $2,500. The existing cap of $2,500 will continue to apply to accidents occurring prior to October 1, 2014.
The cap will also be indexed cumulatively in January of each year, beginning in 2016. The maximum recoverable amount will be the amount in place on the date of the accident.
- Changes to the Definition of “Minor Personal Injury”
The amended legislation will not only increase the amount of the “cap” for accidents occurring on or after October 1, 2014, but will also restrict the definition of “minor personal injury” to sprains, strains and whiplash-associated disorders that do not result in a serious impairment. This is a significantly more narrow definition than currently exists in PEI.
The amended legislation also provides guidance on matters relevant to the determination of “minor personal injury”, the assessment of multiple injuries, and the impact of a claimant’s failure to follow reasonable treatment advice.
- Direct Compensation for Property Damage
Although not yet in force, direct compensation for property damage is expected to be in effect sometime in 2015. Fault determination rules have not yet been prescribed.
What This Means For You
Greater benefits will be available for accidents occurring on or after October 1, 2014. These changes may result in new strategic considerations in the defence of auto-related personal injury claims in PEI.
The foregoing is intended for general information only and is not intended as legal advice. If you have any questions, visit our firm website at www.stewartmckelvey.com to contact or learn more about our Prince Edward Island lawyers practicing in the area of Insurance.
Archive
*Flowchart below last updated June 2, 2020 (Originally published April 14, 2020) Dante Manna With the passing of Bill C-14, the COVID-19 Emergency Response Act, No. 2 on April 11, 2020, the federal government has…
Read MoreBurtley Francis Recently, the Government published for public comment draft legislation referred to as the Time Limits and Other Periods Act (COVID-19). The underlying purpose of the draft legislation, which was published on May 20,…
Read MoreMark Tector and Katharine Mack The province of Nova Scotia announced today that most sectors of the economy may begin to reopen. Provincial grant funding was also announced to help businesses open safely, as well as…
Read MoreBrian Tabor, QC, Ryan Baker, and Madeleine Coats On April 16, 2020, Prime Minister Justin Trudeau announced the beginning of a new piece to the COVID-19 federal economic response package – this time, in the…
Read MoreChad Sullivan and Clarence Bennett As many employers resume operations during the ongoing pandemic, we have prepared a list of FAQs and a reopening checklist for businesses operating in Atlantic Canada. Do employers need to…
Read MoreDaniela Bassan, QC Using its COVID-19 Protocol, the English Technology and Construction Court (TCC) handed down remotely a decision about the role of experts in international arbitration and how multiple retainers by a global firm…
Read MoreRuth Trask On a typical, “normal” day in many Canadian households, adults leave home to go to work, and kids attend school or perhaps daycare. As we keep hearing, though, these are far from “normal”…
Read MoreMaurice Chiasson, QC The Federal Court of Appeal released its decision in The Toronto-Dominion Bank v. Her Majesty the Queen on Apr. 29, 20201. This decision confirms the earlier ruling of the Federal Court in…
Read MoreClarence Bennett and Chad Sullivan The May 8, 2020 announcement On Friday, May 8, 2020, the New Brunswick Government made a significant announcement that the province was moving into the second phase of NB’s four…
Read MoreTo our clients who have been innovating to protect our communities, from all of us here at Stewart McKelvey, we thank you and are proud of your efforts. As we grapple with the profound impact…
Read More