Chapter 16 – Quebec
Introduction
· Compulsory basic plan involves both government and private insurers
· Third party liability must be purchased from a private insurer and AB must be purchased through the government plan
· Claims are also handled different though there are similarities to Ontario
The automobile insurance act
· On March 1, 1978 the government of Quebec
· It entrusted the Société de l’assurance automobile du Quebec w/ the administration of the bodily injuries compensation plan
· The Automobile Insurance Act makes 4 provisions for:
o Compensation for BI
o Compensation for PD
o Indemnity fund
o Groupement des assureurs automobiles
Compensation for bodily injuries
· The plan compensates bodily injury claims w/out reference to who is at-fault (no-fault plan)
· As a general rule all residents of Quebec
· Responsibility is assessed by the ordinary rules of law – not by Fault Charts which apply to PD
· Even if the indemnity provided is insufficient to cover the full amount of the loss, there is no right to sue under any circumstances except if the accident occurred outside of Quebec
· Coverage provided includes:
o Income replacement
o Death benefits
o Medical expenses no otherwise covered
o Certain sums for disfigurement, dismemberment, suffering and loss of enjoyment of life
· The plan is financed by the fees paid by auto owners on the registration of their vehicles and when obtaining their driving licenses
· Additional coverage may be purchased through private insurers for:
o Death
o Dismemberment
o Funeral expense
o Total disability weekly indemnity
Income replacement
· The amounts are determined by the net income of the victim and is subject to a maximum gross income
· The intent of the coverage is to provide affordable and readily accessible compensation w/out the expense or delays of establishing fault or going to court
Death Benefits
· There are various amounts payable to different classes of dependents
· These amounts depend on the status of the deceased w/in the family
Other indemnities
· Specified lump sum indemnities are paid by the Société for injury, disfigurement, dismemberment, suffering or loss of enjoyment of life
· To the extent that they are not already covered by a social security plan, the Société also reimburses expenses incurred for:
o Medical treatment
o Transportation by ambulance
o Rehabilitation services
o Para medical treatments
o Purchase of prostheses or orthopedic devices
Compensation for property damage
· Provided by private insurers subject to certain guidelines
“Fonds d’indemnisation” (indemnity fund)
· The purpose is the compensation of innocent victims of auto accidents caused by uninsured or unidentified motorists
· This applies mostly to PD insurance since most BI claims can be compensated by the Société
· The limit is equal to the compulsory min limits for third party liability
· The fund received a percentage of money collected at the registration of vehicles and driver’s license
The groupement des assureurs automobiles (G.A.A.)
· The G.A.A – a corporation that includes all insurers licensed to write auto policies in Quebec
· The G.A.A main duties are:
o To enable every auto owner to take out liability insurance. Each insurer agrees to provide insurance to anyone requesting it as long as they can share that risk w/ all insurers through the risk sharing plan P.R.R. The plan de repartition des risques (P.R.R.) is a Facility type mechanism which insurers pool any risk they have accepted through the regular market but which they feel do not meet their min u/w standards
o To determine the standards on which centers for the appraisal of damage sustained to auto may be established and operated
o To issue a certificate to qualified persons acting as appraisers
o To establish and publish a standardized accident report form
o To establish and administer a direct compensation agreement
· G.A.A acts as Automobile Statistical Agency for Quebec
· G.A.A is responsible for the management of Automobile Claims Tracking System (fichier central des sinistres automobiles) which allows any insurer to obtain for u/w and rating purposes, the claims history of anyone holding a Quebec
The direct compensation agreement
· All insurers are bound by the direct compensation agreement for the settlement of auto accidents
· Driver Fault Charts are used to determine fault w/ accidents occurring in Quebec
· Insureds deal only w/ their own insurers regardless of fault
· If an agreement cannot be made w/ regards to the PD settlement, the insured may bring action against their own insurer and let the courts decide the matter
· Where the liability insurer is not the same as the collision insurer, the liability insurer must reimburse the collision insurer the amount representing the insured was not at fault (examples on page 7)
· Items not considered in Driver Fault Charts:
o Admission of guilt
o Actions of a pedestrian
o Speed
o Weather conditions
o Visibility
o Road conditions
o Light, sound, or hand signals
o Marked or unmarked road lines
The standard Quebec
· Used by private insurers in Quebec
· The major difference compared to the one used in other provinces is that it is divided into only 2 sections of coverage – third party liability and loss of or damage to insured auto
· Additional AB coverage is available under Q.E.F. 34 – Accident Benefits
Third party liability
· Third party liability coverage under this policy would only be claimed against in instances where the Automobile Insurance Act does not apply such as accidents occurring outside the province, or involving vehicles outside the scope of the government plan, or relating to PD other than vehicle damage
Loss of or damage to insured automobile
· Not a compulsory coverage
· Own damage must be claimed under the vehicle owner’s policy regardless of fault
· No deductible for fire/lightning
· Collision w/ a person/animal covered under comprehensive
Non-residents
Bodily Injury
· When non-resident’s province has a reciprocal agreement w/ Quebec
o The non-resident would collect 100% of Société benefits from their own insurer regardless of fault
· When non-resident’s province does not have reciprocal agreement
o The non-resident would receive Société benefits to the extent they were not at fault. If such payment is less than their own AB, they may claim the difference from their own insurer
Vehicle damage
· If own insurer is licensed to write business in Quebec
o Third party liability only
§ Insured’s third party insurer indemnifies to the extent the insured was no at fault as per Fault Charts
§ No right to recovery in subrogation for the insurer
o Third party liability and collision
§ Collision coverage applies first and the third party insurer pays the deductible to the extent the insured was no at fault
§ No right to recovery for third party insurer but if collision insurer is different, they will have right to recovery
· If own insurer is not licensed to write business in Quebec
o The third party insurer would not pay its insured for collision damage
o The collision insurer would have right of recovery to the extent the third party was negligent – ordinary rules of law apply
Q.E.F. 34 – Accident benefits
· Optional coverage sold by private insurers to those who wish to supplement the Société benefits. Basic features are:
o Death
§ Must occur w/in 12 months of accident
§ 100% of principal sum if named insured dies; a percentage of this if spouse or dependent die
o Dismemberment
§ Must occur w/in 12 months of accident
§ Up to 100% of principal sum depending on severity of loss
o Medical and funeral expenses
§ Medical expenses excess of Société, government, group or other private plans
§ Funeral expenses of $500 excess of Société benefit
o Total disability
§ 7-day deductible and runs for a specified number of wks
§ Excess to Worker’s Compensation, Crime Victim’s Compensation and Société
§ Coverage for a specified amount per wk
Summary of Quebec
“Société de l’assurance automobile du Quebec”
· Provides no fault BI and death benefits to:
o Quebec residents, in respect of accidents occurring in and out of the Province of Quebec
o Non-residents – only to the extent not at fault
· Tort abolished for BI and death in Quebec
· Quebec residents get Société benefits outside Quebec and retain right to sue outside of Quebec
Société no-fault benefits
· Income replacement up to 90% net income, subject to a max net income
· Funeral expenses, variable amounts
· Lump sum for death
· Lump sum for disfigurement, dismemberment, suffering, or loss of enjoyment of life up to a limit (Schedule for type of disfigurement and associated lump sum)
· The Société administers the Quebec
· Direct compensation agreement (physical damage) using driver fault charts
· Each liability insurer shall indemnify its own insured to the extent that the insured is no at fault
Definition of damages covered under the direct compensation agreement
· Damage to the auto
· Loss of use
· Loss of personal effects and commercial property carried in or on the vehicle and belonging to the insured up to a max amount
· All auto insurers licensed in Quebec
· Groupement des assureurs auto (G.A.A) acts like the Facility and guarantees a market
· Membership in the G.A.A is compulsory for all insurers licensed for auto insurance in Quebec
· Section 84 makes third party property damage insurance compulsory for the owner of any auto operating in Quebec
· Negligence is applied by Driver Fault Charts but these may be challenged by an insured – payment to the insured under the charts may be increased if the insured succeeds but not decreased
Sample Review Questions - Automobile Insurance (Part 1)
1. The 4 provisions contained in the Quebec Automobile Insurance Act are:
a. Compensation for bodily injury
b. Compensation for property damage
c. Indemnity fund
d. Groupement des assureurs automobiles
2. The government compensates all Quebec
3. Quebec motorists are not allowed to sue for injuries received in Quebec
4. The Société provides income replacement. It is determined by the net income of the victim subject to a max gross income.
5. Other benefits that a Quebec
- death
- medical expenses not otherwise covered
- certain sums for disfigurement, dismemberment, suffering and loss of enjoyment of life
6. Private insurers provide third party property damage coverage.
7. The basic purpose of the “Fonds d’indemnisation” (indemnity fund) is the compensation of innocent victims of auto accidents caused by uninsured or unidentified motorist.
8. The purpose of the Groupement des assureurs automobiles is to act like Facility and guarantee a market for all automobile owners.
9. The main functions of the Groupement des assureurs automobiles is:
- to enable every auto owner to find a licensed insurer w/ whom he may take out liability insurance
- to determine the standards on which centers for the appraisal of damage sustained to auto may be established and operated
- to issue a certificate to qualified persons acting as appraisers
- to establish and publish a standardized accident report form
- to establish and administer a direct compensation agreement
10. Direct compensation agreement – liability for property damage, caused by an accident occurring in Quebec
11. The purpose of driver fault charts is to determine fault. These charts depict various possible accident situations and set out rules for apportioning liability.
12. Loss of or damage to the insured auto is not a compulsory coverage. All own damage must be claimed under the vehicle owner’s own policy regardless of fault.
13. If a person had no collision coverage they would only collect the amount to which they were not at fault. If they had collision coverage they would collect the full amount less the deductible (would be reimbursed portion of deductible not at fault).
14. The purpose of Q.E.F. 34 is to provide optional accident benefit coverage to supplement the Société benefits.
15. The major difference b/w the Q.P.F. 1 and the standard auto policy used elsewhere is that the Q.P.F. 1 is divided into only two sections of coverage – third party liability and loss of or damage to insured automobile.
16. If a non-resident’s home province has a reciprocal agreement with Quebec
17. Damage to third party property other than autos is covered under third party liability where the Automobile Insurance Act does not apply.
18. Non-resident vehicle damage when their insurer is licensed to write business in Quebec
- third party liability coverage only – the insurer will indemnify to the extend the insured was not at fault and will have no right to subrogate
- third party liability and collision coverage – collision coverage applies first and third party liability pay the deductible to the extent the insured is not at fault. If the collision insurer is different to the insured’s third party insurer, the collision insurer will have the right of recovery
Non-resident vehicle damage when their insurer is not licensed to write business in Quebec
- third party insurer would not pay its insured for collision damage
- collision insurer whether the same as third party insurer or different would have the right of recovery
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