On May 1, 2021, a new no-fault auto insurance plan is set to go into effect in British Columbia. Despite this fast-approaching date, Vancouver residents may be unaware that these policy changes could drastically cut their legal options if they are injured in a car accident.
On the surface, no-fault insurance sounds great. If you’re in a crash, you can expect at least some compensation for your injuries and other losses from the Insurance Corporation of British Columbia (ICBC). But unfortunately, the new plan is more restrictive, reduces victims’ rights, and places tighter limits on the benefits they can receive after a wreck.
As a motorist in British Columbia, you need to understand this system and how your rights and access to fair compensation could be limited if the worst happens. Keep reading for an explanation from the experienced Vancouver car accident lawyers at Warnett Hallen LLP.
What Is the New No-Fault Auto Insurance?
Every British Columbian should understand how the rollout of ICBC’s no-fault insurance system will affect them. So, what exactly is no-fault auto insurance (also called “enhanced care”), and what does it mean for you?
The term “no-fault” does not mean that no one is to blame for a vehicle accident. Instead, it means that both parties in a crash will receive insurance benefits to help cover the cost of injuries and lost wages, regardless of fault.
When the new policy goes into effect, victims will only be allowed to sue drivers who are found guilty of a specific criminal code offense, such as driving while intoxicated. This stands in marked contrast to the current policy, which gives accident victims the freedom to pursue full compensation, including pain and suffering, from a negligent, at-fault party through an injury claim or lawsuit.
Rather than having the opportunity to pursue compensation through the courts, most car accident victims who have disputes about their payments will have to take their issue up with the Civil Resolution Tribunal (CRT) or an ICBC fairness officer.
In many instances, therefore, ICBC will handle these complaints and decide if the policyholder deserves more compensation than they initially received. In other words, the insurance company will have the power to act as judge and jury. This system, of course, raises serious concerns about fairness and objectivity in the handling of victims’ claims.
How the New Policy Does NOT Benefit You
The government of British Columbia has touted enhanced care as a way for ICBC policyholders to save on premiums. According to the developers of the no-fault system, policyholders will see a reduction of about 20 percent (or an average of $400) in their annual insurance rates.
Unfortunately, the economic reality for thousands of injured motorists will not be so clear-cut. Many accident victims’ financial recovery will be substantially diminished as a result of the new policy. This is primarily due to a couple of aspects of the new no-fault insurance system.
For one, the average amount of compensation given to injured car accident victims will decrease significantly under enhanced care. In order to be able to compensate at-fault drivers for their medical costs and lost wages and still offer lower premiums, ICBC will essentially have to dip into funds that would once have gone to accident victims. As a result, victims will effectively pay the difference so that negligent drivers receive increased benefits.
Moreover, the vast majority of accident victims will be unable to pursue fair compensation in court. In the event that someone feels shortchanged by ICBC following an accident, the no-fault system will bar them from taking the issue up in court unless the negligent driver committed a criminal offense. In this way, no-fault auto insurance silences victims who should be empowered to take legal action instead.
In short, if you are hurt by someone else’s reckless driving, you are very likely to take the financial hit for that person’s negligence.
Reasons to Be Wary of the No-Fault Auto Insurance Policy
Despite what the proponents of enhanced care may have you believe, there are a number of reasons to be wary of the no-fault auto insurance policy. Consider these pitfalls:
- Limitations on legal action: As soon as no-fault insurance takes effect in May, accident victims will be unable to take their complaints to court in almost all cases. Instead of having the opportunity to pursue fair compensation in a court of law, these victims will be forced to submit complaints to ICBC — and will have no choice but to trust the judgment of the insurer.
- Tight restrictions on compensation for pain and suffering: Enhanced care is poised to eliminate most payments for pain and suffering. This means that accident victims will no longer have access to compensation for lost enjoyment of life and other intangible losses they’ve suffered. ICBC has already capped this kind of compensation in recent years. Now it’s severely limiting it even more.
- Very few consequences for at-fault drivers: Under the no-fault plan, at-fault drivers will face virtually no consequences for their reckless behavior. Aside from the prospect of increased insurance premiums, there will be very little motivation for these drivers to stay sharp and keep everyone safe. This may very well decrease the safety of B.C. roadways for all motorists and passengers in the long-term.
How Warnett Hallen LLP Can Help After a Car Accident in Vancouver
After a car accident in British Columbia, there are a series of hoops that the ICBC expects you to jump through before paying out the benefits you deserve. The Vancouver car accident lawyers at Warnett Hallen LLP can guide you through the complex ICBC claims process and help you pursue the compensation you need to move forward.
We will investigate your accident, handle all communications with ICBC adjusters, and work to secure maximum compensation that takes all of your losses into account. Don’t let justice pass you by — call or contact us right away to speak to a proven car accident lawyer.