Significant changes may be coming to the standard automobile policy in PEI, including increases to the accident benefits available under Section B and an increase to the so-called "cap" applicable to claims for minor personal injury.

The PEI superintendant of insurance is preparing a formal proposal to government recommending significant changes to Section B of the standard automobile insurance policy in PEI, to provide more benefits for those injured in motor vehicle accidents.

The proposal is at the preliminary stages, thus it is not yet clear which changes will be put forward. Some of the changes being considered by the superintendant are as follows:

  1. Increase in No-Fault Accident Benefits

No-fault accident benefits available under the PEI standard auto policy (i.e. Section B benefits) are expected to increase, mirroring the accident benefits available in New Brunswick. If approved, this would mean significant increases to the current limits available in PEI:

Click here to view table.

  1. Changes to the Cap for Minor Personal Injury

The superintendent is expected to recommend that the so-called cap on non-pecuniary damages for minor personal injury increase from $2,500 to $7,500 or $8,000, bringing it in line with Nova Scotia and New Brunswick. He might also recommend that the PEI cap be indexed with the consumer price index.

Although details are still currently unavailable, changes may also be proposed to the definition of "minor personal injury", possibly adopting the language in New Brunswick or Nova Scotia.

  1. Direct Compensation for Property Damage

The superintendant is expected to propose a shift to direct compensation for property damage.

  1. Introduction of Catastrophic Accident Benefits

The superintendent is also considering the adoption of catastrophic accident benefits within the automobile insurance policy, but they are not expected to form part of the superintendant's upcoming proposal to government. These benefits would expand the coverage provided by Section B to include excess medical and rehabilitation coverage for individuals who are "catastrophically" injured in a motor vehicle accident, but are unable to recover from a third party.

What this means for you Some or all of these amendments could be included in legislation to be passed this fall (2013). The superintendant has made it clear that there will be an opportunity for insurers to provide input after his proposal is made to government.