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The following Op-Ed piece, authored by Jeff Haley, Government Affairs Manager for IBC appeared in the Calgary Herald on January 10, 2010 in response to an editorial (December 21st) which contained a number of inaccurate statements.
Cap helps all but personal-injury lawyers (Calgary Herald, 10 Jan 2010, Page A11)
Your Dec. 21 editorial, “Adding Injury to Pain,” criticizing the Supreme Court of Canada’s refusal to hear a case involving the $4,504 minor injury cap, requires some clarification. The editorial unfortunately, and perhaps unintentionally, propagates common misconceptions about the minor injury cap that can only serve to confuse your readers. Your suggestion that $4,504 “does not even begin to cover the costs of physiotherapy, pain medication and other expenses incurred while treating the injury over a long period of time” is misleading.
Your readers need to know that the minor injury cap on pain and suffering awards has nothing whatsoever to do with the compensation that accident victims receive to heal from their injuries. All auto accident victims, regardless of whether their injury is minor or not, receive generous compensation for their medical treatments, lost income and a host of other economic damages they may incur as the result of an accident.
The $4,504 cap applies only to pain and suffering awards for auto accident victims who’ve suffered minor injuries. Medical professionals determine whether an injury is classified as minor. Courts determine pain and suffering awards, which compensate victims for loss of enjoyment of life, nothing else. Prior to the implementation of the minor injury cap on pain and suffering awards in Alberta, there was no limit to the amount that could be rewarded, even for very minor injuries.
Often extravagant, and sometimes outrageous, these awards were responsible for driving up claims costs which, in turn, threatened premium stability. And none benefited more than personal injury lawyers who were also, not coincidentally, behind the unsuccessful constitutional cap challenge.
Auto accident victims have two ways to access compensation. The first is Accident Benefits, which are paid by one’s own insurers regardless of which driver caused the accident. When the Alberta government implemented the minor injury cap on pain and suffering awards, it also greatly enhanced Accident Benefits. Weekly payments for lost income were increased, and the limit on compensation for medical and rehabilitation treatment was increased five fold — from $10,000 to $50,000. All victims have access to the full $50,000 in accident benefits, even if their injury is classified as minor.
The second option available to innocent accident victims is the right to sue an at-fault driver for additional economic expenses incurred as a result of the accident. Once again, there is no limit on economic compensation that a court may award, even if an injury is classified as minor.
The only limitation that exists is the $4,504 minor injury cap on pain and suffering awards. Once again, this is only one portion of damages a court may award victims suffering from minor injuries, and it has nothing to do with the money they receive to pay for their medical care or for lost income.
Managing auto insurance requires a delicate balancing act between providing robust benefits for those who are injured while ensuring stable premiums for all who drive. The minor injury cap was introduced as a necessary and reasonable limit on the right to sue, and since its implementation, auto insurance premiums in Alberta have dropped 16.8 per cent.
A stable auto insurance system benefits everyone: claimants, government, insurers, policyholders. The only people who do not benefit from a minor injury cap are personal injury lawyers.
I think your readers would agree that Albertans should not have to pay higher auto insurance premiums simply to satisfy the economic needs of this special interest group.
So, while opinions about the value of implementing a minor injury cap will vary, the facts must not.
JEFF HALEY IS GOVERNMENT AFFAIRS MANAGER FOR THE INSURANCE BUREAU OF CANADA — ALBERTA AND THE NORTH
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