Income Replacement Benefits
Accident & Injury Personal Injury Accident & Injury
Summary: Income Replacement Benefit What is the income replacement benefit?
Income
Replacement Benefit
What is the income replacement benefit?
In Ontario, every motor vehicle liability policy is deemed to
provide for the statutory accident benefits set out in the Statutory Accident Benefits Schedule (SABS) pursuant to section 268
of the Insurance Act. This means that
if you are involved in a motor vehicle accident, you can file a claim under the
SABS for specified benefits. One such benefit you may qualify for is the income
replacement benefit (IRB).
Do I qualify?
Section 5 of the SABS sets out the eligibility criteria for
the IRB. First, you must have sustained an impairment as a result of an
accident.
Second, you must have been employed at the time of the
accident and within 104 weeks following the accident you suffer a substantial
inability to perform the essential tasks of your employment as a result. The
same criteria applies if you were self-employed at the time of the accident.
In the alternative, if you were not employed at the time of
the accident you may still qualify if you were:
(a)
employed for at least 26 weeks during the 52
weeks before the accident or you were receiving Employment Insurance at the
time of the accident,
(b)
at least 16 years old or you were excused from
attending school under the Education Act
at the time of the accident, and
(c)
as a result of and within 104 weeks after the
accident, suffering a substantial inability to perform the essential tasks of
the employment in which you spent the most time during the 52 weeks before the
accident.
To support the claim that you suffer a substantial inability
to perform the essential tasks of your pre-accident employment, your insurer
may request a Disability Certificate (OCF-3) be completed by your health care
practitioner. They may also require an Employer’s Confirmation Form (OCF-2) be
completed by your employer if you were employed before your motor vehicle
accident.
What if I qualify for more than one benefit?
It is possible that you may qualify for two or more of the
IRB, non-earner benefit (NEB) and caregiver benefit (CGB). If that is the case
the insurer must, within 10 business days after receiving your application,
notify you that you have 30 days from when you receive that notice to make an
election (s. 35(1)). You must make this election by completing an OCF-10 form.
Once you elect, you can only re-elect under very specific and
rare circumstances (see s. 35(2)). In other words, your election is very likely
final and should therefore only be made after careful consideration.
How long does the benefit last?
Under section 6 of the SABS, an IRB is payable for the period
in which you suffer a substantial
inability to perform the essential tasks of your employment. The benefit
does not start until after the first week of disability and ends after the
first 104 weeks of disability unless you suffer a complete inability to engage in any employment commensurate to your
education, training or experience as a result of the accident. “Complete
inability” is a tougher test to satisfy. The court provided some guidance on
this in Burtch v. Aviva Insurance Company
of Canada, 2009 ONCA 479 (CanLII).
The plaintiff in Burtch
was a general labourer who, due to his injuries, could not perform the heavy
lifting required of his job. There was evidence that a long-haul trucking job
was suitable, though the plaintiff did not did not have the licence and could
not afford the training program to acquire it. The court found that if
substantial upgrading or retraining is not required, the job for which the
plaintiff was not already qualified may still be suitable.
If you meet the complete inability test after the first 104
weeks of disability you will continue to receive the IRB, but the amount is
reduced to $185 per week.
How much is the IRB?
If you are under the age of 65 your IRB is the lesser of 70%
of your gross weekly income (calculated by dividing your gross yearly income by
52 weeks), up to $400 per week, or $185 per week. The amount of your IRB is
reduced by all other income replacement assistance (defined in s. 4(1)), if
any, that you receive for the same week under section 7 (1).
Under section 47, the amount is also subject to deductions
for any collateral benefits you may receive (i.e. short term and/or long-term
disability benefits).
IRB amounts will decrease, in accordance with the formula set
out in section 8, after the age of 65.
The
Accident Benefits process can be complex, which is why we recommend you retain
the services of a lawyer to ensure you receive the maximum level of benefits
you are entitled to.