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What Types of Compensation Can You Receive from a Motor Vehicle Accident Lawsuit?

Updated: 4 days ago

Being involved in a motor vehicle accident is a stressful experience, particularly for those who sustain serious injuries and are unable to return to work, school, and to other recreational activities.

Such individuals may wonder what to expect from a lawsuit.

This article is intended to provide a broad overview as to the types of compensation available from a motor vehicle accident claim.

At-Fault or Not?

In Ontario, you may only commence a claim against an individual whose negligence caused your injuries. If you have sustained injuries in a motor vehicle accident for which another person is at fault, you may commence a lawsuit (often referred to as a “Tort” claim) against the at-fault individual. You may also commence an Accident Benefits claim (often referred to as “AB’s”). An accident benefits claim is not a lawsuit and is not dependent upon fault. An Accident Benefits claim is made against your own auto insurance company for various benefits including but not limited to medical rehabilitation and attendant care benefits, income replacement benefits, lost educational expenses, and housekeeping and home maintenance benefits if you sustained a catastrophic injury. For more information on Accident Benefits, please see Hillier & Hillier's blog "An Overview of Accident Benefits" or call the office of Hillier & Hillier to discuss commencing an Accident Benefits claim with one of our lawyers. Commencing an Accident Benefits claim against your own insurer will not impact your insurance premiums.

If you are entirely at fault for a motor vehicle accident, then you will not be able to commence a lawsuit. You will however be able to claim Accident Benefits.

In some situations, multiple vehicles may be at varying degrees of fault for an accident. In this event, you may be able to commence a claim against the other at-fault drivers, however, your damage award (ie… the financial amount recovered) will be reduced by the percentage at which you are found responsible for the accident. For example, if you are found to be 50% responsible for an accident, then your damage award will be reduced by 50%.

Types of Compensation

In a motor vehicle accident lawsuit, there are generally four main areas of compensation (often referred to as “damages”). The four main heads of damages include the following: (i) general damages; (ii) loss of income; (iii) medical expenses and attendant care; and (iv) housekeeping and home maintenance expenses. Depending on the circumstances of your claim, you may also have other “out of pocket” expenses that do not fall under these four heads of damages.

General Damages

An award for general damages is meant to compensate an individual for their pain and suffering arising from injuries sustained in a motor vehicle accident. Individuals may have heard about multi-million-dollar awards for general damages for pain and suffering arising from the United States. In the United States, unlike Canada, there is no limit on an award for general damages. In 1978, the Supreme Court of Canada set a “cap” for general damages at $100,000, partially to curb the spread of multi-million-dollar awards that may financially devastate defendants and significantly increase auto-insurance premiums. Further, personal injury actions in Canada are intended to restore an individual to the situation they would have been in had an accident not occurred. Multi-million-dollar general damage awards would be inconsistent with this purpose and would provide a windfall to Plaintiffs (the Plaintiff is the party who starts the lawsuit).

However, the $100,000 cap set in 1978, is to be adjusted for inflation. In Ontario, as of 2024, the range for general damages is anywhere from $0 to approximately $455,271 (the $100,000 cap adjusted for inflation). An award for general damages is not tied to any calculation. Rather, an award for general damages is meant to reflect the severity of one’s injuries and the impact these injuries have had on a certain individual’s functioning, with the most serious and impactful injuries resulting in general damage awards near the high end of the range ($455,271), and the least serious injuries falling on the lower end of the range.

An award for general damages arising from a car accident in Ontario is subject to two further important rules.

First, you may only claim general damages if you sustained a serious permanent impairment of an important physical, mental, or psychological function (often referred to as “the threshold”). If a judge determines that your injuries do not meet this threshold, then you will not receive any amount for general damages. Medical evidence is necessary to meet the threshold. This threshold test also applies to a claim for medical rehabilitation expenses, discussed below. It does not apply to a loss of income claim.

Second, an award for general damages may be subject to the “statutory deductible” set out in the Insurance Act. As of January 1, 2024, a deductible of $46,053.20 will apply to any general damage award below $153,509.39. Further, juries presiding over motor vehicle accident trials will not be made aware of this statutory deductible. Therefore, if a jury awards an amount for general damages below $153,509.39, then the figure will automatically be reduced by $46,053.20. If a jury awards an amount above $153,509.39 for general damages, the amount will remain unchanged. The application of this rule may have harsh effects as can be seen from the examples below:

  • Example 1: Individual 1 is awarded $100,000. Individual 1 will receive $53,946.80

  • Example 2: Individual 2 is awarded $150,000. Individual 2 will receive $103,946.80.

  • Example 3: Individual 3 is awarded $153,509.40. Despite being awarded a mere $3,509.40 more than individual 2, individual 3’s award will not be subject to the deductible, and individual 3 will receive $153,509.40, which is $49,562.60 more than individual 2.

While the fairness of the deductible can be debated at great length, it will nevertheless apply to every general damage award falling under $153,509.39 (in 2024) in motor vehicle accident cases absent a change in the law by the Ontario government.  

Finally, and more troubling, the deductible ( as of 2024 it is $46,053.20) increases each year to keep pace with inflation as does the minimum figure that must be met for the deductible to not apply. As of 2024, the deductible of $46,053.20 applies to general damage awards below $153,503.39. In 2023, a $44,367.24 deductible applied to general damage awards falling below $147,889.59 whereas in 2022, a $41,503.50 deductible applied to general damage awards under $138,343.86. The applicable deductible and minimum amount (often referred to as the “vanishing point”) is determined based on the year your motor vehicle accident claim proceeds to trial rather than the year of the motor vehicle accident itself. 

Loss of Income (Economic Loss)

You are entitled to claim a loss of income which you incurred because of your motor vehicle accident-related injuries. A loss of income may arise if your accident-related injuries prevent you from returning to work.

You may claim for a loss of past income and a loss of future income. The distinction between past and future is important in the motor vehicle accident context.

A loss of past income applies to the period of time following a motor vehicle accident up to the date of trial.

A loss of future income-earning capacity applies to the future period of time post-dating a trial.

With respect to a loss of past income, you cannot advance a claim for a loss of income incurred for the seven days following an accident. Additionally, you may only recover 70% of your lost income for this past period (seven days following the accident up to the date of trial).

You may recover 100% of future losses of income, so long as you can prove that there is a “real and substantial possibility” that you will incur these losses in the future. Mere speculation is not enough. Once again, medical evidence and actuarial/accounting evidence is required to establish a past and future loss of income claim.

If you return to work at your same pre-accident hours and salary, you will unlikely be able to claim a loss of future income, however you may be entitled to claim a loss of competitive advantage if your injuries have rendered you less competitive in the marketplace (ie… less able to compete for positions, receive promotions, or take on significant and valuable overtime).

In motor vehicle accident cases in Ontario, a motor vehicle accident defendant will also receive credit for any income replacement assistance you received while off work (ie…including but not limited to CPP disability, income replacement benefits from your accident benefits insurer, ODSP, Ontario Works, Short Term Disability, and Long-Term Disability).

Medical Expenses, Rehabilitation, and Attendant Care

Similar to an award for general damages, to receive an award for health care expenses not covered by OHIP, you must first establish that you sustained a serious permanent impairment of an important physical, mental, or psychological function (often referred to as “the threshold”).

The amount awarded for non-OHIP related health care expenses is dependent upon the facts of a specific case. In some circumstances, an individual’s injuries may not require ongoing treatment beyond that which is covered by OHIP. In such cases an award for health care expenses will be low. By contrast, in cases where an individual requires around the clock attendant care for the remainder of the individual’s life and/or significant amounts of treatment for rehabilitation, an award for health care expenses will perhaps be the most significant aspect of the lawsuit.

Once again, medical evidence will be required to determine an individual’s treatment needs as will accounting/actuarial evidence to determine the cost of such treatment.

Individuals involved in a motor vehicle accident, whether at fault or not, will also have the option of pursuing a claim for Accident Benefits against their own insurer. Depending on the severity of an individual’s injuries, they may be entitled to reasonable and necessary medical and rehabilitation expenses up to $3,500 (for minor injuries), $65,000 (for non-minor and non-catastrophic injuries, and $1,000,000 (for catastrophic injuries). These amounts may increase depending on whether an individual has purchased optional/enhanced benefits. The defendant in the lawsuit is entitled to a credit for amounts received and available to a claimant from their Accident Benefits insurer.

Housekeeping and Home Maintenance

Individuals who sustain significant injuries in motor vehicle accident cases may lose the ability to complete their housekeeping and home maintenance responsibilities. They may incur costs for assistance with these activities and may continue to do so into the future. In such cases, these individuals will have a claim for compensation to cover past and future housekeeping and home maintenance expenses. Again, medical evidence and accounting/actuarial evidence is necessary to establish a successful claim for housekeeping and home maintenance assistance. The onus of proof is on a claimant to establish their past and future damages.

The personal injury lawyers at Hillier & Hillier combine their knowledge of the law with their expertise in gathering relevant evidence to consistently produce exceptional results for their clients. The lawyers at Hillier & Hillier specialize exclusively in personal injury law, and together, have a combined experience of over 50 years of practice in personal injury law. Contact Hillier & Hillier at 905 453 8636 to schedule a free consultation by zoom videoconferencing, in person, or by telephone.

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