What Happens If There Is No Insurance Coverage After An Accident?

By Michelle Arzaga | March 26, 2013

Toronto Personal Injury Lawyer Michelle Arzaga:

What Happens when an Accident is Caused by an Uninsured or Unidentified Driver?

In Ontario, all auto policies have coverage for damages caused by uninsured or unidentified motorists.  The coverage is built into every auto policy that is bought in Ontario, and it is not possible to opt out of this coverage when you buy an auto policy.

In the case of accidents caused by unknown or unidentified motorists, this coverage is triggered under the injured person’s own auto insurance policy.  For instance:

Let’s say Susan is stopped in her own vehicle at a red light. She is subsequently rear ended by Diane, and Susan is injured in the accident.  Diane flees the scene before police arrive, and Susan is unable to get the license number of the fleeing car.  There is no way to identify Diane, and she is never caught.

Unidentified motorist coverage under Susan’s own auto policy would be triggered.  In essence, Susan’s own auto insurer steps into the shoes of the unidentified driver’s insurer and responds to Susan’s claim for damages. Susan still bears the same burden of proving her case – proving liability, the extent of her damages, so forth –  but she does have coverage. The same rules would also apply if Diane was identified, but had no auto insurance at the time of the accident.

There are limits to the unidentified and uninsured motorist coverage. Aside from the routine legal tests that all plaintiffs face in proving their claims, unidentified motorist coverage and uninsured motorist coverage can only pay up to a maximum limit of $200,000 on a plaintiff’s claim for damages.  This limit is in contrast to most auto insurance policies, which carry a maximum of $1 million in coverage.

Not Enough Coverage

Using the same scenario above, what if the Plaintiff’s damages exceed the $200,000 available?  What if the Susan’s damages are $500,000 as a result of the accident? Is there a way to cover the $300,000 shortfall?

Yes. OPCF 44R – Family Protection Coverage, is an optional coverage.  It is a form of coverage that is offered to those who buy auto policies, but it is not a mandatory purchase.

For individuals who choose to add it as an endorsement to their auto policy, the face value is typically $1 million dollars.  The OPCF 44R is meant to protect the injured person when there is inadequate coverage from an at-fault party’s insurer.  In the same scenario above, assuming Susan purchased the OPCF 44R before the accident, her insurer would pay her its $200,000 maximum limits for unidentified motorist coverage.  Then under the OPCF 44R endorsement, Susan’s insurer would also be liable for the remaining $300,000. Note that only the person who owns the auto policy, or the spouse or dependent relative of the insured would have access to the OPCF 44R.

What if No One Has Insurance?

Even in this instance, people injured in motor vehicle accidents in Ontario may have access to coverage for their damages.

In Ontario, the Motor Vehicle Accident Claims Fund (MVACF) is a government fund that is established to provide compensation to people injured in car accidents but have no insurance whatsoever.  MVACF is considered the payor of last resort when there is no auto insurance coverage available to respond to an injured person’s claim for damages.

As a result of all of these safeguards in Ontario’s insurance regime, it is rare for an injured person to have no recourse for compensation for injuries caused by another motorist. Whatever the circumstances, if you are involved in an accident, talk to a personal injury lawyer to make sure you completely understand your rights.

Michelle Arzaga is a personal injury lawyer with Pace Law Firm in Toronto. Pace’s personal injury lawyers have been helping accident victims since 1980.