2025 Increases to Statutory Deductibles and Monetary Thresholds

If you are the victim of a motor vehicle accident in Ontario, your recovery will be governed by the Insurance Act. In order to recover damages for pain and suffering, also known as “general damages”, you must meet the legal threshold test set out in Section 267.5(5) of the Insurance Act:

(5) Despite any other Act and subject to subsections (6) and (6.1), the owner of an automobile, the occupants of an automobile and any person present at the incident are not liable in an action in Ontario for damages for nonpecuniary loss, including damages for non-pecuniary loss under clause 61 (2) (e) of the Family Law Act, from bodily injury or death arising directly or indirectly from the use or operation of the automobile, unless as a result of the use or operation of the automobile the injured person has died or has sustained,

(a) permanent serious disfigurement; or

(b) permanent serious impairment of an important physical, mental or psychological function.

In the event that your injuries and impairments surpass this legal threshold, your claim may be subject to a statutory deductible. This deductible is set annually, according to inflation, by the Financial Services Regulatory Authority of Ontario (FSRAO). The figures for 2025 were recently published as follows:

However, there are two exceptions in which the statutory deductible does not apply:

1. The general damages award exceeds the monetary threshold set out above, or

2. The claim involves a fatality, and is advanced under the Family Law Act

To make matters more complicated, there is a court-imposed limit on the amount an injured Plaintiff can be awarded for pain and suffering. In 1978, the Supreme Court of Canada set the cap on general damages at $100,000. Adjusted for inflation, the upper limit is estimated as of October 2024 at $460,969.

Although these increases may seem like good news for injured Plaintiffs in Ontario, they ultimately benefit insurance companies by limiting the insurer’s financial exposure. It is essential to have an experienced lawyer if you have been injured in a motor vehicle accident.

At Bogoroch & Associates LLP, we take great pride in our strong track record of helping our clients navigate this complicated insurance process. If you or your loved one has been injured in an accident, please reach out to our team to understand if you have a claim.