Claiming for Damage to your Automobile

In Ontario, you claim for damage to your vehicle from your own insurance company. What you recover will depend on several things:

• in the case of a car accident, whether you were at fault or partially at fault;
• what optional insurance coverage you carry for your vehicle;
• what the actual cash value of your vehicle was at the time of the accident.

Claiming with mandatory coverage only

In Ontario, your mandatory coverage includes Direct Compensation-Property Damage, which means that if your vehicle is damaged in an accident, you may recover directly from your own insurance company - to the extent that you are not at fault - for the damage to your vehicle, its contents and loss of use, less any deductible you arranged with your insurance company. For example, if you were 75% at fault for the accident - and therefore 25% not at fault - your company will pay 25% of your loss, less any deductible under Direct Compensation-Property Damage.

Under a Direct Compensation-Property Damage claim, you can, to the extent you're not at fault, recover for damage to the vehicle, the cost of a temporary rental vehicle (transportation replacement coverage) and for damaged personal contents carried in the car. Contents carried for sale or delivery are not covered.

If your accident is with a car from outside Ontario, Direct Compensation-Property Damage does not apply unless the insurer of the out-of-province car has signed an agreement with Ontario to settle claims under the Direct Compensation-Property Damage rules. If an agreement does not exist, you will have to sue the out-of-province vehicle owner and the driver to recover your loss. Your insurance company will know if the out-of-province insurance company has signed an agreement.

If your accident is with a vehicle that is uninsured, you claim under the mandatory uninsured motorist coverage of your policy. If you claim under this coverage, you must be able to identify the other vehicle involved in the accident, and you will be covered for damage to your vehicle and contents up to $25,000, less the first $300 of the loss.

Claiming with mandatory plus optional coverage

If you purchased optional Collision coverage you may recover from your insurance company for damage to your vehicle caused by collision or upset, regardless of fault, less the deductible you chose at the time you purchased the coverage. Coverage for transportation replacement is not normally covered under the Collision coverage.

If your vehicle is hit while parked and the responsible party does not remain at the accident scene and cannot be identified, you will be reimbursed for the repair costs only if your policy includes Collision coverage.

Comprehensive coverage is the other popular optional coverage for loss or damage to your vehicle. It covers losses that are not covered by collision, such as theft, vandalism or fire. Your agent or broker can advise you on the full range of optional coverages.

Making a claim

To find out if you have particular coverage for a specific automobile, check your certificate of automobile insurance to see if it lists a premium paid for that coverage, or shows that the coverage is provided at no cost. Your policy itself explains many details about your insurance, your rights, and how your company and you can work together. If you do not have a copy of your policy, ask your insurance agent, broker or company for one.

If you have a motor vehicle accident and are making a claim, your company will want a written notice within seven days describing the accident and the damage to the vehicle and property. Do not remove evidence of damage or repair the car before your company has had a chance to inspect the vehicle, verify the damage and estimate the cost of repairs.

Insurance companies often make payments to both you and the garage or shop where the car is repaired; you should not have to pre-pay. Be sure you and your insurance company agree in advance about what repairs will be made and who will pay for them. As far as replacement parts are concerned, the company is within its rights to repair an insured car using parts the same age and condition as the car itself. Car owners are responsible for repair costs that improve the vehicle beyond its pre-accident state.

Deductible

You can expect to pay your full deductible unless the accident was not your fault or was only partially your fault. For example, where an accident is 25% your fault, you will be covered by Direct Compensation-Property Damage for the 75% that you were not at fault.

Since Collision coverage will apply only to the remaining 25%, you are responsible for 25% of the deductible.

Actual cash value

Insurance companies set the value of most vehicles at the time of the accident. They call this actual cash value(ACV) and base the amount largely on the average retail selling price of cars in your region of the same age, make, model and condition.

Companies use actual cash value to decide whether to treat your car as a total loss or whether to repair it. The amount you receive if your car is a total loss (actual cash value, less deductible, with the company assuming ownership of the car) may not be what you consider the real value. One place to look for comparable values is the Red Book used to determine sales tax on used cars. Your community library will have a current copy and you should use it to check the retail cost column.

Fault Determination Rules

Insurance companies must use the Fault Determination Rules from the Insurance Act in assessing the percentage of fault after an accident. If you disagree with the way your company has assessed the degree of fault, you can argue the decision in court; the Act specifies that the court can adjust fault according to ordinary rules of law.

What happens to your insurance premium when you make a claim?

If the accident is determined not to be your fault, your insurance rating should not be affected. If you are found at fault for any percentage of the accident, your premium may increase.

What are Collision Reporting Centres?

Some jurisdictions have Collision Reporting Centres. If you are involved in a minor accident in one of these jurisdictions and there are no injuries, the police require that drivers attend one of these reporting centre with their vehicles. At the reporting centre, the drivers complete accident reports and in some cases, all the important information is sent to the insurance companies involved in order to start the adjusting of the claim.

Source: Ontario Government