Starting July 1, 2026, Ontario drivers will face a major shift in their auto insurance coverage. If you’re injured in a car accident, the consequences could be devastating if you’re not prepared.
The Financial Services Regulatory Authority of Ontario (FSRA) has announced that key benefits under the Statutory Accident Benefits Schedule (SABS), namely Income Replacement Benefits (IRB) and Non-Earner Benefits, will become optional for new or renewing auto policies issued on or after that date.
This means that unless you proactively opt in and pay for these coverages, you may no longer be entitled to immediate financial support under your car insurance policy (accident benefits) if a car accident leaves you unable to work or function as you did before.
What’s Changing and Why It Matters
Currently, all Ontario auto insurance policies come with a standard package of no-fault accident benefits. These include but are not limited to:
- Medical, rehabilitation, and attendant care benefits
- Income replacement benefits (IRB) of up to $400/week (unless optional top-ups are purchased)
- Non-earner benefits (NEB) of $185/week (for students, homemakers, retirees, etc.)
- lost educational expenses, replacement of damaged medical assistive devices, and other supports in certain cases such as housekeeping and caregiver benefits
Under the new rules, only the first category—medical and attendant care benefits—will remain mandatory. Everything else will be optional.
That means the default policy won’t pay you a cent in lost wages if you’re injured and can’t work. Nor will it provide anything if you’re a student or stay-at-home parent who is completely unable to carry on a normal life in your regular daily activities after a car crash.
What’s the Risk for Ontario Drivers?
Without optional benefits, your insurance may cover treatment, but not your income, your time, or the huge disruption an injury can cause to your daily life. This creates several real risks:
1. Lost Income With No Relief
If you’re employed and injured in a crash, you may be off work for weeks or even months. Without IRB in your policy, you’ll have no automatic right to income replacement while you recover. You may need to rely on other benefits such as unemployment insurance or long term disability insurance (if you have it.)
2. No Support for Non-Earners
Students, retirees, homemakers, and caregivers contribute in meaningful ways. But without optional non-earner benefits, they may receive nothing for the loss of function, freedom, or independence after an accident.
3. Delayed Access to Compensation
If you don’t have no-fault benefits, your only recourse may be to sue the at-fault driver in a tort claim—but that process can take years to resolve, and it comes with legal hurdles.
Can I Still Sue the At-Fault Driver?
Yes, under Ontario’s dual insurance system, injured people can still make tort claims against a negligent driver who caused or contributed to the crash. This includes claims for:
- Pain and suffering
- Past and future lost income
- Housekeeping or caregiver expenses
- Out-of-pocket medical costs not covered by insurance
But here’s the catch: tort claims are slow, uncertain, and complex.
A lawsuit typically takes 2–5 years or more to resolve. During that time, you may have no income support or interim financial help—unless your policy includes the optional benefits you’re now being asked to opt into.
There’s also legal tests in Ontario that must be met.
To win damages for pain and suffering in a tort claim, you must meet Ontario’s legal test for car accidents and prove that you have a “permanent serious impairment of an important physical, mental, or psychological function.” Many injuries, while painful and debilitating, may not qualify.
You also need to prove a “threshold” test that your pain and suffering is worth at least $155,965.54 (as of 2025). If you cannot do this, then there’s a statutory deductible (currently about $46,790.05 as of 2025 and indexed to inflation) that gets subtracted from your damages award in most pain and suffering claims.
Even though most personal injury lawyers work on contingency, being without income for months or years can cause financial and emotional strain long before your tort claim settles.
How to Protect Yourself Now
With these changes coming, it’s critical to take a few steps now to protect yourself and your family:
Review Your Current Auto Insurance Policy
Ask your broker or insurer whether your policy currently includes:
- Income Replacement Benefits
- Non-Earner Benefits
- Caregiver or housekeeping benefits
Ask how much extra it would cost to keep or add them when you renew after July 1, 2026.
Consider Your Situation and Risk
Could you afford to lose your income for 3–6 months while waiting on a tort claim? Are you a student, retiree, or parent who contributes in non-financial ways? If so, non-earner or caregiver benefits may be especially important.
Keep Records and Ask for Written Confirmation
Get written confirmation of what optional benefits you’ve selected. If your insurer doesn’t clearly explain your options, ask for it in writing and keep copies.
If You’re Injured, Talk to an Ontario Personal Injury Lawyer Immediately
If you’ve been in a car accident—especially after July 1, 2026—it’s more important than ever to speak to a personal injury lawyer early.
A lawyer can:
- Review your auto policy to see what benefits you’re entitled to
- Challenge an insurer’s denial of benefits
- File a tort claim, if appropriate, and protect your right to future compensation
- Ensure you don’t miss strict deadlines that could prevent you from recovering anything
In some cases, a lawyer may even argue that you weren’t properly informed of your right to opt into these benefits—opening up possible legal remedies.
Bottom Line: Don’t Wait Until After the Car Crash
Ontario’s 2026 insurance reforms shift responsibility onto the consumer. While you can still sue a negligent driver in tort, the delays, legal thresholds, and uncertainty mean that having robust accident benefits in place from day one is your best protection.
You don’t want to wait years to receive compensation you thought you’d get automatically.
If you’re reviewing your insurance coverage—or if you’ve already been injured in a crash—don’t go it alone.
An experienced personal injury lawyer can help you understand your rights, preserve your evidence, and maximize your recovery – whether through accident benefits or a tort claim.
Protect yourself. Ask questions. Know your options. And if you’re hurt, then get legal advice right away.