BC Government’s plan to save ICBC from financial doom has finally been revealed. It comes in the form of a $5,500 cap to minor injury pain and suffering claims. BC Attorney General David Eby says these soft-tissue injury minor claims are to blame for much of ICBC’s expensive payouts, and is one of the major reasons why the provincial insurer seems to be bleeding money.
To us, this seems to be a way to discourage claimants from obtaining fair compensation.
Currently, pain and suffering damages for even minor injuries is unrestricted, meaning a claimant could potentially receive upwards of $350,000 for pain and suffering damages. Of course, it’s just about unheard of for pain and suffering damages for minor injuries to ever reach that high.
Instead, on average, awards for minor pain and suffering damages are $16,499. That’s about three times more than government is comfortable paying. What’s more, ICBC’s own legal fees are costing the insurer 24% of its annual budget, so the government is also in part blaming lawyers and expensive legal fees.
BC Government is punishing the victims of injury by reducing the amount of damages that can be awarded.
The solution? Starting on April 1, 2019, a whole bunch of changes, among those already discussed, are slated to take place.
So what’s wrong with the changes to how ICBC soft tissue injury claims?
Here’s our problem with this. The whole concept of legal damages is to compensate those who have been harmed, to put them back in the position they were in prior to whatever caused the harm. Capping minor injury claims goes against this damages principle. In effect, BC Government is punishing the victims of injury by reducing the amount of damages that can be awarded.
It’s one thing to increase premiums for those who break the law, for those at fault for accidents, but it’s quite another to cap the amount of compensation given to those who have suffered at no fault of their own.
If that wasn’t enough, BC Government also appears to want you to challenge your claims without the expertise of a lawyer by your side. When the changes come into effect, at least some claims will be heard in BC’s new Civil Resolution Tribunal, a type of small-claims resolution body where you need special permission to even bring a lawyer.
That’s right. In the event that there’s a dispute with your claim, government is essentially asking you to fend for yourself in front of a tribunal. Previously, a lawyer would have done this for you on a contingency basis, or at no cost to yourself unless you lose your claim.
And with a limit of $5,500, it’s questionable whether many people will even take the time to go through with a claims dispute. If you were awarded $4,000 in damages for pain and suffering, will you really bother to go through an entire process for the possibility of $1,500 more? We don’t think many people will.
To us, this seems to be a way to discourage claimants from obtaining fair compensation.
What are pain and suffering damages for soft tissue injury, though?
Pain and suffering for minor injuries generally refers to soft-tissue injuries. Sore muscles, sprains, that sort of thing. Media reports suggest that BC Government is defining minor injuries as including “whiplash, aches and sprains, cuts and bruises and anxiety.”
Sure, these seem like minor issues. But it’s important to remember that virtually anyone can be involved in an injury. A soft-tissue injury or a sprain suffered by someone in their 20s is completely different from the exact same injury inflicted on someone who is elderly and frail. Consider this: while a young person may recover quickly from a soft-tissue injury, the same injury caused to an elderly person could trigger all sorts of other ailments down the road.
Or here’s another example. Two women of the exact same age, exact same build, suffer the exact same injury. One of them, however, is in the early stages of pregnancy – let’s say week one. A bit of back pain is going to affect them differently. We would argue that in some circumstances, even though it’s still considered a minor injury, the woman who is pregnant suffers far more. Months after the incident, her back pains may be exacerbated by carrying the extra weight. Perhaps not quite enough to require medical attention, but the impact to her life will undoubtedly be far more significant than a similar woman who was not pregnant. In this case, is a cap of $5,500 in pain and suffering for both women really fair?
And who even decides the severity of your injury? What if you believe your injury is extremely severe, but ICBC disagrees? Unfortunately, the government’s solution to these types of disputes is for you to head to the Civil Resolution Tribunal. And hopefully you know what you’re doing, because remember, you may not be allowed to bring your lawyer to the Civil Resolution Tribunal.
Why should drivers have to pay an additional premium to protect themselves from others who have caused them harm?
But wait, the government has other solutions
BC Government says it’s increasing accident benefits as part of its changes. Medical care and recovery costs will increase to $300,000 from $150,000, with increased wage loss payments ($740/week), home support benefits ($280/week), funeral cost coverage ($7,500) and death benefits ($30,000).
All this is nice, but is borne at the cost of drivers who did nothing wrong other than suffer an injury that qualified for what is effectively a penalty instead of a benefit. Moreover, these increases in benefits are meaningless for “minor injury” claims. Even if the benefits were left at the former levels, a minor injury claimant would be hard pressed to maximize the benefit. Only a small fraction will ever be used by a minor injury claimant.
This apparent trade off for minor injury claimants is nothing more than an empty gesture, a distraction, a sleight of hand by the government.
And to add insult to injury, government is adding an option for drivers who can afford it to increase their minor injury pain and suffering damage cap to $75,000 – at the cost of $1,300 per year.
Again, it’s penalties like this that is upsetting to us in the field of negligence law. Why should drivers have to pay an additional premium to protect themselves from others who have caused them harm? Put it this way. You get into an accident and suffer multiple soft-tissue injuries, but in order to be compensated for these injuries beyond $5,500, it is you who has to pay additional annual fees. Not the other driver who hit you.
How is this fair?
In addition, government says minor injuries that persist for more than 12 months will not be limited by the cap. First, this certainly won’t help our example of a woman pregnant who suffers for her nine months due to a minor injury. And in our view, having this provision does not address the concerns and still leaves the system vulnerable to those who exaggerate their minor injuries beyond the 12-month period.
Will these changes to ICBC save the provincial insurer?
One thing is for sure. Attorney General David Eby stands by BC’s public insurance model, though there has been significant criticism regarding ICBC’s monopoly on basic insurance. Eby is also anticipating that these changes will be the first step to bringing ICBC’s costs under control.
We’re not so sure.