Bill 171 -Benefit For Victims?

Alan Shanoff, wrote an article in the Toronto Sun titled, "Little Benefit for Victims.  What is the most objectionable about Liberals' Bill 177 is the haste with which it's been introduced."

 Shanoff discussed the introduction Bill 171, the "Fighting Fraud and Reducing Automobile Insurance Rates Act".   According to the Ministry of Finance's Press Release this bill includes new initiatives to protect Ontario drivers.   

 Shanoff suggests that what this bill promises to 'protect' (Ontario drivers) is not the case at all. He states;

 "A real way would be by encouraging insurance companies to settle cases quickly. But one provision of the bill provides an incentive for insurance companies to delay settlements and payments to those injured in motor vehicle accidents. Bill 171 would reduce the amount of interest insurers are required to pay on money owed to accident victims. The current rate is 5% but under Bill 171 the rate would fall to 1.3% and be modified quarterly. Ontario's finance minister says this will "help reduce claims costs." I'm sure it will. For the insurers."

 This article also featured comments by The Ontario Trial Lawyers Association and Fair Association of Victims for Accident Insurance Reform, both objecting to this change. OTLA said, "insurers will be set to profit particularly in serious cases as they can earn greater returns by delaying settlement and investing the funds." In addition, Fair Association of Victims for Accident Insurance Reform stated; "there is no incentive to settle cases when insurers can make a fortune sitting on the dollars that are owed to the injured accident victim."

 Shanoff continues to explain the way this Bill disadvantages Ontario drivers,

 "Another real way to protect drivers is to provide arbitrators with the power to penalize insurers that act unreasonably in withholding or delaying penalties. Actually, arbitrators hearing accident benefits cases currently have that power under the Insurance Act. They can award a lump sum of up to 50% of the amount withheld or delayed, along with interest, at the rate of 2% compounded monthly. Curiously, Bill 171 eliminates that power. So far, it doesn't seem to be providing much protection to Ontario drivers."

 If you would like to read the rest of the article, please click here.

REFERENCES:

http://www.torontosun.com/2014/03/15/little-benefit-for-victims