New policy limits legal options, reduces victims’ rights, tightens limits on benefits: PI partner
As the Insurance Corporation of British Columbia’s new car insurance coverage takes effect on May 1, lawyers may field calls from potential clients wondering about these changes’ impacts and complexities, a personal injury lawyer has said.
“The new regulations for no-fault benefits are extremely complex and in certain areas impossible for a layperson to understand,” said Paul Warnett, partner at Warnett Hallen LLP. “Injured individuals will be relying upon ICBC treating them fairly.”
This new enhanced care coverage will be the most significant change to auto insurance in the province since ICBC’s creation in the mid-1970s, Warnett noted.
“With the new no-fault regime, tort claims disappear except for certain circumstances where criminal activity is present on the part of the defendant,” said Warnett. “It will be a cultural change with respect to those not at fault having access to the same benefits as those at fault (as long as criminal activity is not present for those not at fault).”
ICBC’s enhanced care coverage seeks to offer more affordable and stable insurance rates, possibilities for refunds and access to better care and recovery benefits for individuals injured in an auto accident, regardless of who was responsible. The ICBC forecasted $1.5 billion in cost savings in the first year of implementing the new system.
The new system will eliminate most legal costs, such as lawyer fees and the adversarial approach of suing drivers who are at fault. However, injured persons can still pursue a civil claim for certain damages against at-fault drivers convicted of criminal offences such as impaired driving or against other parties like vehicle manufacturers whose actions have contributed to the accident.
A blog post on the website of Warnett Hallen LLP called attention to potential issues arising due to the new auto insurance system, including limitations on pursuing legal action, tighter restrictions on compensation for pain and suffering, very few consequences for at-fault drivers and substantially diminished financial recovery for most accident victims.
The blog post lamented that “if you are hurt by someone else’s reckless driving, you are very likely to take the financial hit for that person’s negligence.”
Considering that the ICBC will be handling most victims’ claims and determining whether they deserve more compensation than initially received, there will potentially be concerns regarding the fairness and objectivity of the ICBC’s handling of such complaints. Under the new system, most injured individuals will have to bring their disputes before the Civil Resolution Tribunal or before an ICBC fairness officer rather than with the courts.
“In other words, the insurance company will have the power to act as judge and jury,” said the blog post.