Court Decision is Another Blow for Ontario Auto Insurance Holders

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Ontario’s drivers rely on insurance to cover costs when they’ve been involved in an accident. When an injury has occurred, insured drivers expect their provider to deliver an appropriate level of accident benefits according to the province’s Statutory Accident Benefits Schedule (SABS). But what happens when an insurance company fails to act in their clients’ best interest?

According to some personal injury lawyers, policy owners now have fewer options to fight back against insurance providers acting in bad faith. This is due, in part, to the Ontario Court of Appeal’s decision in Stegenga v. Economical Mutual Insurance Company, according to a recent article in Law Times.

The Stegenga case focuses on a 15-year-old girl who was seriously injured in an automotive accident. The family sought accident benefits from their insurer, Economical, but were never informed that the girl might qualify to receive catastrophic accident benefits. The family instead received standard benefits and, when those benefits ran out, the insurer refused to provide additional coverage.

The family believed that the insurer had acted in bad faith by failing to inform them of their right to be assessed for catastrophic injuries. However, they were not able to sue for bad faith due to changes made to Ontario’s Insurance Act in 2016. Those changes revoked injury victims’ right to sue insurers in court; instead, they would have to pursue claims before the Licence Appeal Tribunal.

“There’s only one catch – there is no claim for bad faith at the Licensing Appeals Tribunal,” one lawyer told Law Times. “There are provisions that are penal towards the insurance company in some circumstances that could increase the amount of money they have to pay.”

However, those provisions apply only to claims for withheld benefits. The Stegenga family was not seeking withheld benefits, but rather compensation for their insurer’s bad faith conduct. They are left without obvious legal recourse.

The 2016 changes to Ontario’s Insurance Act have impacted accident victims and the personal injury lawyers that represent since for years. Besides stripping injury victims of their right to pursue compensation for insurance companies’ bad faith actions, those changes drastically reduced the amounts of benefits available to injured drivers.

If you or a member of your family has been injured in a car accident, contact Neinstein Personal Injury Lawyers today to schedule a free, no-obligation consultation. Our team of experienced personal injury lawyers will assess your claim, explain your legal options, and provide guidance as you embark on your road to recovery.


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Greg Neinstein, B.A. LLB., is the Managing Partner at Neinstein Personal Injury Lawyers LLP. His practice focuses on serious injury and complex insurance claims, including motor vehicle accidents, slip and fall injuries, long-term disability claims and insurance claims. Greg has extensive mediation and trial experience and has a reputation among his colleagues as a skillful negotiator.
Greg Neinstein
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