Uninsured and Underinsured Motorist Protection Claims
If you are injured in an accident caused by an individual with limited or no insurance, B.C. has a statutory program in place which allows compensation regardless of no insurance or limited insurance. For no insurance situations, you can apply for coverage with ICBC under Section 20 of the Insurance (Vehicle) Act, which provides coverage up to $200,000 plus legal costs and disbursements for all claims. For losses above the $200,000 level, Section 148.1 of the Regulations under the Insurance (Vehicle) Act provide for a program called underinsured motorist protection (“U.M.P.”). Payment under U.M.P. is by ICBC.
In British Columbia, the minimum third-party limits allowed for ICBC insurance is $200,000. As a result, most ICBC claims will never involve U.M.P. because most claims are under $200,000. However, if, for example, you are one of several individuals that are injured by an atfault motorist with the minimum $200,000 third party liability coverage, it is not very difficult to have all the injury claims exceed the limits and move the case into U.M.P. coverage. Another example is accidents caused by USA insured where the third party limits are almost always $200,000.
U.M.P. coverage is considered coverage of last resort. That is, ICBC can force you to take all steps necessary to try to recover money from the atfault motorist before you can even access U.M.P. This includes litigating against the at-fault motorist and then when you have a judgment, trying to recover against the at-fault motorist. If the at-fault motorist cannot pay the judgment, you can then proceed against ICBC to get payment under U.M.P.
Generally speaking, most British Columbians would have access to U.M.P coverage. To have access to U.M.P. coverage, you need to be a considered an insured under the Insurance (Vehicle) Act. An insured includes a member of a household where one of the family members owns an ICBC licensed vehicle. Alternatively, you are entitled to U.M.P. coverage if you have a driver’s license or you have your own vehicle licensed with ICBC.
Under U.M.P., the basic coverage you receive is $1 million without paying anything more. However, you can buy excess U.M.P. coverage, which provides coverage to $2 million. All you or a family member needs to do is pay a premium of around $25 when placing ICBC insurance on one of the vehicles in the household. Obviously, this is $25 well spent because the last thing you want is less than maximum insurance coverage in the event that you or your family member is severely injured by an at-fault motorist carrying minimum or no insurance coverage.
The limits on U.M.P. coverage are all inclusive limits meaning that the maximum is either $1 or $2 million. From that coverage, ICBC gets to deduct the following according to Section 148.1 of the Regulations under the Insurance (Vehicle) Act:
- (a) paid or payable by the corporation under section 20 or 24 of the Act, or recoverable by the insured from a similar fund in the jurisdiction in which the accident occurs,
- (b) paid or payable under section 148,
- (c) paid or payable under Part 7 or under legislation of another jurisdiction that provides compensation similar to benefits,
- (d) paid directly by the underinsured motorist as damages,
- (e) paid or payable from a cash deposit or bond given in place of proof of financial responsibility,
- (f) to which the insured is entitled under the Workers Compensation Act or a similar law of the jurisdiction in which the accident occurs, unless;
- (i) the insured elects not to claim compensation under section 10 (2) of the Workers Compensation Act and the insured is not entitled to compensation under section 10 (5) of that Act, or
- (ii) the Workers’ Compensation Board pursues its right of subrogation under section 10 (6) of the Workers Compensation Act,
- (f.1) to which the insured is entitled under the Employment Insurance Act (Canada),
- (f.2) to which the insured is entitled under the Canada Pension Plan,
- (g) paid or payable to the insured under a certificate, policy or plan of insurance providing third party legal liability indemnity to the underinsured motorist,
- (h) paid or payable under vehicle insurance, wherever issued and in effect, providing underinsured motorist protection for the same occurrence for which underinsured motorist protection is provided under this section,
- (i) paid or payable to the insured under any benefit or right or claim to indemnity, or
- (j) paid or able to be paid by any other person who is legally liable for the insured’s damages;
As already indicated, U.M.P. coverage is coverage of last resort. ICBC uses this to their advantage, in some cases, by forcing you to pursue the at-fault motorist in a lawsuit in Supreme Court. Even if you get a judgment against the at-fault motorist, ICBC can make it difficult to recover money from them by forcing you to go after the at-fault motorist for his/her personal assets. Even after taking all the steps, you still do not have access to the ICBC money as ICBC can force the case to an arbitration hearing, which can include a rehearing of some of the issues in the Supreme Court.
Like other ICBC claims, ICBC is involved in the defense of these matters. This is the case even when you are going after an at-fault motorist that does not have ICBC coverage.