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
In the Federal Budget 2011, the Government of Canada stated that it would develop a new plan to support public infrastructure beyond the expiry of the 2007 Building Canada Plan in 2013-14. The Government has…
Read MoreCASL is a new federal law aimed at eliminating unsolicited and malicious electronic communications. Originally introduced in December 2010, the majority of CASL’s provisions will come into force on July 1, 2014. Once in effect,…
Read MoreThe Termination Meeting: A time and a place for everything The decision has been made, but the ship hasn’t yet sailed. Somebody has to deliver the bad news and as difficult as this might be,…
Read MoreClient Update: Consistent Use: The Collection of Union Members’ Personal Information by their Unions
The Public Service Labour Relations Board concluded that an employer was required to provide home contact information about bargaining unit members to the union which represents them because this information is needed by the union…
Read MoreIn preparing for the 2014 proxy season, you should be aware of some regulatory changes that may impact disclosure to and interactions with your shareholders. This update highlights what is new in the 2014 proxy…
Read MoreIn a decision released by the Supreme Court of Canada (“the Court”) on January 31, 2014, the Court clarified the law with respect to the tort of interference with economic relations by unlawful means. Joyce,…
Read MoreAs we move into 2014, we know our region’s employers will want to be aware of new legislation that has passed or could soon pass that may affect them. The following is what has become…
Read MoreWhat’s new? Our employer clients will be familiar with the Labour Standards Act, which sets out the employment standards applicable in Newfoundland and Labrador. Two amendments were made to the legislation this week, both of which…
Read MoreAs many of you will now know, the Nova Scotia Government introduced legislation on Friday, December 6, 2013, amending provisions of the Nova Scotia Trade Union Act dealing with First Contract Arbitration. This client update sets out…
Read MoreIn a decision that will largely be of interest to international organizations that have been granted some type of immunity in Canada, the Supreme Court of Canada (SCC) has confirmed that international organizations enjoy immunity…
Read More