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What is a Threshold Denial?

In August, 2015 the Government of Ontario implemented changes to the Ontario Insurance Act, R.S.O 1990, C.I.8 in order to lower costs for insurance companies. One of the key changes made was to increase the amount of deductible for accident claims. The "deductible" is the amount of an injured person's pain and suffering award that is stripped away by the Ontario government insurance laws. Accident victims do not receive the full value of their claims for pain and suffering or loss of enjoyment of life ("non-pecuniary damages") unless the claim exceeds $138,343.86. Below this amount, called "the threshold", if a claimant is awarded damages for pain and suffering / loss of enjoyment, there is a deductible applied by the insurance company.

The amount of this deductible increases every year as it is indexed to inflation set at 1.6%. Prior to the 2015 change in insurance legislation, the deductible amount was $30,000. Effective on January 1, 2022 and until the end of this year, $41,503.50 will be deducted from awarded non-pecuniary damages. However, if the victim’s pain and suffering is assessed as more than $138,343.86 then the deductible does not apply. This means that if an accident victim was awarded $50,000 for pain and suffering, they will actually receive only $8,496.50 ($50,000 - $41,503.50). You need a lawyer to ensure you are not subjected to a threshold denial. Call 416-644-3999 or for a free and confidential consultation.

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