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Statutory Deductible for General Damages – Personal Injury Lawyers

Mar 28, 2021 | Car Accidents, Legal Articles

Moussa Sabzehghabaei

Personal Injury Lawyer

Statutory Deductible for General Damages – Personal Injury Lawyers

In an effort to implement no-fault insurance in the early 1990s, the Ontario provincial government announced a $10,000 statutory deductible on the amount of compensation for general damages that may be incurred in vehicle accidents. The objective was to discourage injury lawsuits for minor damages with the expectation that the recently available accident benefits would compensate victims for the lost awards.

Many injury lawyers perceived this deductible as a tremendous cost to pay for no-fault insurance. However, things have changed. According to a recent blog post published by the Ontario Trial Lawyers Association, the law was used frequently to punish innocent auto accident victims for the benefit of reckless drivers and their insurance providers.

What are general damages?

Suppose you are injured in a traffic accident. In that case, you have the right to file a personal injury claim and get compensated for injuries, pain, suffering, and other damages you may have suffered. This type of compensation is commonly known as general damages.

What’s a deductible?

A deductible is a specific amount of money that an insurance policyholder must pay before the insurer contributes. For instance, if your vehicle incurred $1,000 of damage in a mere fender-bender and your policy included a $500 deductible, your insurance provider will contribute $500 toward vehicle repairs.

Statutory deductible works in a similar way. Suppose you incur $100,000 worth of general damages for pain and suffering in a traffic accident. In that case, you will get compensation valued at $60,245.69. If the general damages fall below $39,754.31, the chances are that you will walk away with absolutely nothing. It is essential to mention that statutory deductible only applies for compensation awards less than $132,513.28

What’s the issue with a statutory deductible?

In the mind of an experienced lawyer’s opposition to the Ontario’s statutory deductible, is its increasing imbalance with general damages or compensation awards. The amount of compensation has not increased in unison with the statutory deductible, and the available traffic accident benefits have reduced significantly in the past years.

Last November, one Ontario personal injury lawyer told the Law Times that the statutory deductible had grown considerably while the motor vehicle accident benefits continue to shrink. The lawyer emphasized the unfairness or injustice and expressed his concerns over the increased deductible amount. “As much as I appreciate easy access to most medical benefits or better outcomes when that amount is $3500 or less for many people, it is nearly impossible to get the necessary treatment and set yourself on the right path to timely recovery.”

Besides, the Ontario Province’s threshold test for personal injury claims or lawsuits majorly accomplishes what the statutory deductible was implemented for in the first place – to discourage civil action over minimal damages or minor injuries.

It is essential to mention that insurers that defend compensation claims for reckless drivers must have a fair right to challenge a lawsuit or claim and make sure that only legitimate personal injury claims are paid out. This can be achieved by reviewing the personal injury claim paperwork, questioning the plaintiff, and hiring lawyers, doctors, or any other professional who can shed light on unclear aspects of a claim. The insurance companies can also request a judge to determine the correct value of the damages.

The statutory deductible was implemented to save insurers. Instead, it penalizes innocent traffic accident victims. The overall impact of the statutory deductible is simply protecting the rich insurers and drivers while taking away what’s rightfully the victims’. The provincial government of Ontario can correct this form of injustice by eliminating the statutory deductible.

Alternatively, the Ontario Government may have insurance companies pay the statutory deductible into a fund intended to help accident victims. That means the insurance companies will no longer have the incentive to fail to pay a personal injury claim. As you have seen, the statutory deductible was implemented for what seemed the right purpose.

Alternatively, if a claim surpasses the deductible, then the deductible can be held to not apply to ensure the seriously injured victim receives full compensation they are awarded.

An experienced Ontario personal injury lawyer can help

If you or someone you know was involved in a traffic accident, contact Grillo Law, today to arrange a free no-obligation initial consultation. We have experienced personal injury lawyers who have been helping severely injured accident victims for many years. Our lawyers can also offer you guidance and help you navigate the complex process of seeking the amount of compensation you deserve.not advantageous to our client, we are experienced at trial and throughout the litigation process.

You will not pay any fees until your case is won or settled

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