Is the Sky Falling? Auto Insurance Changes June 2016

Julie Entwistle, MBA, BHSc (OT), BSc (Health / Gerontology)

In June 2016 the Statutory Accident Benefits Schedule will change again.  I say “again” because in my relatively short sixteen year lifespan working in auto, the industry has gone through some major plastic surgery.  It is becoming less and less recognizable as it is nipped and tucked once more, becoming almost unrecognizable as the mandatory product we all purchase to be covered in the event of an accident.

Since the announcement of the upcoming changes, the common reaction is comparable to the story of Henny-Penny and Chicken-Little who create hysteria after an acorn falls on Chicken-Little’s head.  In earlier versions of the Chicken-Little story all the paranoid animals get lured and eaten by the fox.  Later versions of course have the animals living happily ever after, or finally understanding Newton’s law.

So, is the sky falling in Ontario’s auto insurance?  Well, I won’t say things are all unicorns and rainbows.  As of June 2016 all Ontario drivers will be paying relatively the same dollars for 50-98% of the coverage.  Attendant care and medical rehabilitation monies are being combined, resulting in reductions in coverage totalling $21K for seriously injured people and $1M for those that are deemed catastrophic.  On top of that, the industry will revise the criteria for catastrophic status so less people will qualify in the first place.  As a consumer, it is infuriating that my premiums are not changing to the $50 / year that this new coverage is worth.  As an OT that has clients running out of monies now, this does seem like the sky is falling.  Take for example my 16 year old client with C5 tetraplegia.  One million dollars in combined coverage will not last long for someone that is young, has a permanent impairment, who requires 24 hour care (and sometimes the care of two people simultaneously), and who will require a fully accessible home and vehicle so that his basic needs can be met.  And that does not even speak to the costs for the many therapies, wheelchairs, lifts and other treatments needed, nor the costs to get him education support and engaging in activities that he will find both meaningful and productive.

From a consumer and client perspective I am concerned.  While there is an option to “buy up” for decent coverage, most people don’t exercise this under the “it won’t happen to me” facade.  However, as a wanna-be optimist, from a professional and business perspective I can still help a lot of people with $65K or $1M in coverage.  That is a lot more money available than the $0 my clients with ALS, MS, stroke, or cancer ever receive.

So, Chicken-Little, Henny-Penny and friends overreacted.  They panicked.  They caused chaos.  I, on the other-hand, am choosing to take the adaptive approach.  Where are the opportunities?  What is still good about the coverage that remains?  Where can I still add value and help people?  How can I be proactive instead of reactive?  What initiatives can I support that are advocating for client and consumer protection?  What can I do in my practice to make $65K and $1M last as long as possible?  Call me Julie-Fooley, and perhaps I will be eaten by Fox-FSCO, but I still want to believe in happy endings.