Availability of Insurance in Fatal Accident Compensation Involving Reckless and Impaired Drivers

As a large percentage of Ontario’s workforce have been working remotely due to the lockdowns created by the COVID-19 pandemic, vehicular traffic overall has decreased on our highways and roadways. A disturbing and dangerous side-effect of this phenomenon is that many motorists have taken advantage of the empty roadways to drive recklessly. While the lockdown has seen a significant reduction in accidents, there has been an increase in the number of serious and catastrophic accidents caused by excessive speeding (including stunt driving) and, at times, driving while impaired. Incidents of stunt driving have increased dramatically since the pandemic, with the OPP often reporting on social media young drivers clocking speeds of 150 to 250 km/h on highways and roadways.

A few devastating accidents in recent months have prompted me to write this article.

On June 18, 2020, in Brampton, a 37 year old mother and her three small daughters were killed in a collision caused by a 20-year-old driver who had been (1) speeding (2) driving erratically and, (3) was allegedly under the influence of drugs. The driver was also operating the vehicle while his driver’s license was suspended. This accident received considerable media coverage and pulled at the heartstrings of so many Ontarians, including myself.

Shortly after, I was contacted by the family of a man killed while a passenger in a vehicle driven by a 20-year-old driver who was intoxicated, driving erratically on a provincial highway, and had a G2 driver’s license. This young man leaves behind a grieving family including a 6-year-old daughter.

Fatal Car Accidents and the Insurance Landscape
The deaths of the young Brampton mother and her children, and the young father I mentioned above, has been devastating to their loved ones. While they may wish to pursue compensation for their losses, these accidents raise awareness of some of the obstacles to compensation.

In Ontario, where your loved one has died in a fatal car accident, family members may seek compensation for losses of care, guidance and companionship, as well as financial losses, under section 61 of the Family Law Act. The source of compensation is the at-fault driver’s insurance policy. In other words, in a lawsuit against the at-fault driver, the victims will be compensated by the at-fault driver’s insurance company pursuant to the liability limits attached to the at-fault driver’s policy.

In Ontario, the Insurance Act mandates a statutory minimum amount of liability insurance of $200,000 – in other words, all insurance companies must provide, and all vehicle owners must purchase, a minimum of $200,000 in liability coverage. In practice, most vehicle owners purchase insurance policies with liability limits of $1 million to $2 million. In the majority of cases, this is sufficient to compensate the victims’ families monetarily, although no amount of money can ever replace the loss of a loved one.

The above statutory scheme also applies to the situation where an individual is injured in an accident.

What Happens When the At-fault Driver Does Not Have Enough Insurance, or No Insurance At All?
Some people simply drive without insurance. Sometimes, the insurance company for the driver may deny coverage. For example, a condition of the G2 license is that drivers cannot have any alcohol in their system while operating a motor vehicle. A finding of having consumed alcohol while driving is considered a breach of the insurance policy, which will in turn “void” or cancel the insurance.

A driver may also be in breach of another condition of their insurance policy when they caused an accident.

If the at-fault driver is either “underinsured” or “uninsured”, there are two possible scenario’s that answer the insurance compensation question.

  • The Victim had an Auto Policy

The 20-year-old driver who wiped out an entire family in Brampton probably did not have insurance on his car. But let’s say he did. If he was not licensed to drive a vehicle due to the outstanding license suspension, then the insurance policy on his vehicle, if there was one, would have been breached and thereby voided. As a result, even if he had $2 million in liability insurance, by driving without a driver’s license, the $2 million is reduced to the statutory minimum of $200,000.

If the driver did not have any insurance on the vehicle, then as an uninsured driver, the victims’ family can sue the driver nominally, but cannot expect to receive any compensation from his insurance company. Instead, they must turn to their own insurer for compensation.

All Ontario motor vehicle insurance policies have an optional coverage called the family protection endorsement, also known as the OPCF-44 endorsement. The OPCF-44 endorsement allows the victims’ motor vehicle insurer to take the place of the at-fault motorist in order to top-up the compensation owed to the victims.

If the Brampton mother had $2 million in liability insurance on her own vehicle and had purchased the OPCF-44 coverage, then, in a lawsuit commenced by her family, there will be up to $2 million in insurance available to pay any compensation that the family is found to be entitled to. The $2 million will be sourced as follows: the first $200,000 from the driver’s policy if he had one, and the balance of $1.8 million from the OPCF-44 coverage. If the driver did not have insurance, the full $2 million is available from the OPCF-44 coverage.

  • The Victim did not have an Auto policy

If the young mother in the Brampton accident did not have an insurance policy on her vehicle, then pursuant to the Compulsory Automobile Insurance Act, her family would be precluded from commencing a lawsuit as she, too, would have been driving without insurance.

Sometimes, the victims and their families do not own vehicles, so there is no OPCF-44 endorsement to access. This is the situation in the accident involving the young man with a 6-year-old daughter. There will be a shortfall in insurance compensation where the victim and his family do not own vehicles. The G2 driver’s insurance policy is reduced to the statutory minimum of $200,000 due to the consumption of alcohol while driving. Neither the young man, nor his daughter or other family members owned vehicles. Therefore, there is no OPCF-44 coverage available. The claimants are the young man’s parents, siblings and 6-year-old daughter. The daughter has a “dependency loss” claim – essentially, the loss of financial support her father would have provided to her to age 25. If the family sues the at-fault driver, only $200,000 will be available to answer the claim. The $200,000 will be split between all family members on a pro rata basis.

Will $200,000 be enough to satisfy the daughter’s claim as well as the claims of the other family members?  It is very unlikely.

If the G2 driver’s vehicle was owned by someone else (such as a parent), then the full amount of the policy would be available if the owner is sued by the family, pursuant to section 192(2) of the Highway Traffic Act which makes owners vicariously liable for the negligence of individuals who drive their vehicles with their permission. Unfortunately, this intoxicated G2 driver owned her vehicle.

In situations where the at-fault drivers are uninsured and the victims do not have access to any other source of insurance, then, as a last resort, the victims can turn to the Motor Vehicle Accident Claims Fund, operated by the Ontario government, to access up to $200,000 to satisfy any claims for compensation. More information about the Motor Vehicle Accident Claims Fund can be found here.

The Take-Aways
While we cannot control the actions of another person, it may be possible to protect yourself and our loved ones from the financial impact caused by accidents of the nature I have described above.

If you own a vehicle, there is no such thing as having too much insurance. An increase in your liability limits from $1 million to $2 or even $3 million will likely involve only a small increase in your premium. Also ensure that an OPCF-44 coverage is attached to your policy. You should also speak to your insurance broker about purchasing umbrella insurance. You will be surprised a how little these optional enhancements to your coverage will cost.

Aside from the insurance question, the reality is we should be taking as many precautions as possible to stay safe on our highways and roadways. Motorists still drink and drive. The incidents of stunt driving have not diminished during the 2021 lockdown. These motorists pose a hazard to other users of the roadway including pedestrians, burden our health care and criminal justice system, and at best we should be as vigilant as possible.

And as tempting as it might be to put the pedal to the metal on a stretch of vehicle-free roadway, don’t do it. Driving more than 50 km/h over the posted speed limit, also known as stunt driving, is an offence under section 172(1) of the Highway Traffic Act of Ontario. Your car will be impounded at the scene. A conviction of stunt driving can result in a fine of $2,000 to $10,000, possible incarceration, and the potential for a 2-year license suspension.

Written by

Najma Rashid is a partner at Howard Yegendorf & Associates. Her practice is devoted exclusively to personal injury litigation, including motor vehicle accident claims, SABS disputes before the License Appeal Tribunal, and LTD claims. She was a director on the OTLA Board of Directors for 4 years, and was the Chair of the Long-Term Disability Section in 2020/21.

In addition to OTLA, Najma is a member of the Advocates Society, as well as a supporter of organizations such as REACH Canada, Probono Ontario, the Ontario Brain Injury Association and the Canadian Paraplegic Association.