Starting July 1, Ontario drivers will have the option to remove several accident benefits from their auto insurance policies due to the new auto reform. While this could reduce premiums, it may also increase financial risk following a collision. Understanding which benefits are becoming optional and which should be kept is essential before making any changes.
With the new Ontario auto reforms approaching, it is important to have a clear idea of how you will be affected by these changes. Whether you’re a parent, office worker, truck driver or retail employee, you may be significantly affected in the event you cancel any non-mandatory benefits. From income replacement to maintenance, many important considerations may impact you. This is especially true if you’re in an accident and uninsured.
Let’s take a look at what risks you may now face on Ontario roads, how opting out of coverage can impact you, and how you can plan for the July 1st auto reforms.
Ontario Auto Reform 2026: Mandatory vs. Optional Coverage
To fully understand the changes, it’s crucial first to determine which types of coverage will be mandatory and which will be optional.
Mandatory Coverage:
- Medical benefits
- Rehabilitation benefits
- Attendant bare benefits
Optional Coverage:
- Income replacement
- Housekeeping
- Caregiver benefits
- Non-earner benefits or Lost education expenses
- Death and funeral expenses
When the 1st of July arrives, you may find yourself without many of these optional benefits. These benefits can cover everything from loss of income and education expenses to visitor expenses and non-earner benefits. If you choose not to cancel these benefits, they will automatically roll forward as part of your policy.
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New Ontario Auto Insurance Rules: What Becomes Optional?
When the auto reforms roll around, it can be tempting to opt out of a bunch of benefits to save some money on your premiums. However, it is important to take the time to ask yourself whether you may be opting out of coverage that meets your needs. Let’s take a look at each benefit and how it helps you in the event of an accident.
Income Replacement Benefits
Income replacement benefits will help you replace your paycheck, or a portion of it, if you are hurt in an accident and unable to work. This coverage helps you keep up with bills when an injury prevents you from working and earning an income. If your job is your main source of income, and you don’t have any workplace benefits to replace lost income in the event of a car accident injury, this coverage should be 100% essential to you. You need it to keep up with bills and other payments.
In addition to standard income-replacement benefits, Ontario drivers may consider optional coverage such as OPCF 47R – Increased Accident Benefits for income replacement. This allows you to extend your amount of protection beyond basic policy limits. This will result in a higher benefit amount, providing greater financial security if an injury significantly affects your ability to function or work.
Real-life examples:
- You are a retail employee who is unable to work the register due to a collision.
- You are a truck or delivery driver who is unable to drive due to a collision.
- You are a machine operator who is unable to operate machinery safely due to a collision.
Pro Tip: High earners can also add the OPCF 47R endorsement (Increased Accident Benefits) to extend their protection beyond basic policy limits.
Housekeeping Benefits
Housekeeping benefits are exactly what they sound like: benefits that assist you with chores and common household tasks! Sometimes, after a car accident, you may be unable to complete these tasks. Unfortunately, common household chores such as dishes and laundry do not stop after a car accident. Therefore, this is a great option if you are a senior or single parent without nearby support.
Real-life examples:
- A car accident has left you with a broken arm, rendering you unable to wash dishes or fold clothes.
- A car accident has left you with injuries, resulting in your being unable to cook for yourself.
- A car accident has rendered you unable to shovel snow or clear your walkways in the winter.
Caregiver Benefits
Caregiver benefits also become optional under the auto reform changes. These benefits help cover the cost of hiring someone to care for your children, parents, or dependents if a car accident injures you or sends you to the hospital. Even after an accident, your loved ones may still depend on you for daily support. Caregiver benefits help you continue meeting those responsibilities when you cannot provide care yourself. If you care for dependents or serve as a primary caregiver, you should strongly consider keeping this coverage.
Real-life examples:
- You are a parent with a young child and cannot cook, clean or supervise your kids after an accident.
- You are someone who cares for their elderly parent and cannot cook, clean or supervise them after an accident.
- Adult caring for a family member with a disability: You are unable to assist them with their daily routines after an accident.
Non-Earner Benefits
The next benefit, which becomes optional under the auto reform changes, is the non-earner benefit. These benefits assist those who were not working at the time of their car accident injury. This can include students, retired elders, and stay-at-home parents. In the event your injuries stop you from taking part in your normal routine, your insurance can help you by providing regular support for a set period. Unlike other benefits, this one isn’t based on income. Instead, it is designed to assist you even if you did not have a job at the time of the accident.
Real-life examples:
- You are a stay-at-home parent, but after an accident, you cannot cook, clean or manage caring for your children. Since you weren’t earning an income, you would receive non-earner benefits.
- You are retired and living on your own, but an accident has resulted in you being unable to perform basic tasks such as shopping or self-care. You would be eligible for non-earner benefits.
- You are a student, and a car accident leaves you with injuries, resulting in your being unable to attend class. You would be eligible for non-earner benefits.
Death And Funeral Expenses
Death and funeral expenses will cover funeral costs as well as provide financial support to your family in the event you pass away from a car accident. Unfortunately, funerals can be quite costly. These benefits help lift that burden at a time when your family is mourning. This is a great way of protecting your loved ones from the financial burden of funeral expenses in a relatively inexpensive way.
Real-life examples:
- A car accident leaves your family arranging an unexpected funeral.
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Auto Reform Changes For July 1st: Frequently Asked Questions
What are the new Ontario auto insurance reforms?
Starting July 1, Ontario drivers can opt out of certain accident benefits that are currently included in standard auto insurance policies. Benefits such as income replacement, caregiver benefits, housekeeping coverage, and death and funeral benefits will become optional.
Will my accident benefits automatically be removed?
No. If you do nothing, your existing accident benefits coverage will continue automatically. Drivers must actively opt out to remove optional benefits.
Should I opt out of optional accident benefits?
It depends on your financial situation, employment benefits, and family responsibilities. Many drivers may benefit from keeping optional coverage in place to protect against lost income and caregiving expenses after a serious accident.
What happens if I don’t have income replacement coverage?
If a car accident leaves you unable to work, you may lose income unless you have disability coverage through your employer or a private insurance plan.
Will my insurance rates drop automatically on July 1st?
Not exactly. While Ontario’s auto reforms are designed to give drivers more flexibility and potential savings, premiums will not automatically decrease for everyone. Any cost reduction depends on whether you actively choose to remove optional accident benefits.
Should I opt out if I have workplace health benefits?
Not automatically. Even if you have workplace benefits, they may not fully replace all accident-related coverage, such as income replacement, caregiver support, or housekeeping expenses. It’s important to review your employee plan before making any changes.
How Can You Prepare For The July 1st Auto Reform?
If you don’t make any changes, your current accident benefits package will roll forward. Remember that starting July 1st, you can always change your mind and customize your options to protect yourself and your family further financially. It is always important to make sure you never underinsure yourself. In addition, be informed of the risks you take when cancelling specific benefits. At the end of the day, it is always better to be safe than sorry. If you have any questions regarding car insurance or these new reforms, don’t hesitate to reach out to us at isure today!
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