Accident Benefits Changed July 1, 2026: Who Still Gets Lost Wages?
Income replacement, the weekly accident benefit for lost wages, now only covers the policyholder (the named insured), their spouse and dependants, and drivers listed on the policy, and only if that policy carries it. This article is about crashes on or after July 1, 2026. If you were hurt before that date, different rules may apply, so speak to a lawyer before accepting that your income replacement has ended.
Income replacement became optional on policies entered into or renewed since July 1. A policy bought earlier still has it, and keeps it at renewal unless the named insured declines it in writing. Many passengers, pedestrians and cyclists with no car policy of their own fall outside the covered group and may get no weekly lost-wage benefit.
Medical, rehabilitation and attendant care benefits stay mandatory, and most people hurt in an Ontario crash involving an insured vehicle can claim them. The priority rules in the Insurance Act decide which insurer pays. Lost income can also be claimed from the driver who caused the crash, though the law limits that claim for the time before trial.
What changed on July 1, 2026?
The province made every statutory accident benefit other than medical, rehabilitation and attendant care optional for consumers to buy, on policies entered into or renewed since July 1. That includes income replacement, non-earner, caregiver, housekeeping and home maintenance, and death and funeral benefits.
When a policy bought before July 1 renews, those benefits continue in the same amounts unless the named insured and the insurer agree in writing that the named insured declines or changes them.
The reform also narrowed who those optional benefits protect. For a crash on or after July 1, 2026, they only apply to the named insured, the named insured’s spouse, the dependants of the named insured and of the spouse, and the people specified in the policy as drivers, whatever the policy itself says.
Who still gets income replacement after a crash?
You have lost-wage coverage if you’re the named insured on a policy that still carries income replacement. You’re also covered as the named insured’s spouse or dependant, or as a listed driver, on a policy that has it.
Check what your household’s policy carries and who is listed on it as a driver. That matters when a roommate or a grown child who supports themselves drives the family car. If they don’t fit one of those categories, the optional coverage on that policy doesn’t reach them.
Who is left without lost-wage benefits?
The people most exposed have no auto policy of their own and don’t fit those categories on someone else’s. That can include a passenger in a coworker’s car or a rideshare, a pedestrian in a crosswalk and a cyclist in a bike lane.
What this group loses is income replacement and the other optional benefits, such as non-earner, caregiver and housekeeping benefits. Drivers who declined income replacement on their own policy can end up in the same spot.
For treatment and care benefits, someone involved in an Ontario crash with an insured vehicle generally counts as an insured person under that vehicle’s policy. The priority rules decide which insurer pays, looking first to a policy under which you are an insured. If there isn’t one, a passenger turns to the insurer of the car they were in, and a pedestrian or cyclist to the insurer of the car that struck them.
For a crash in Ontario since July 1, the auto insurer has to pay medical and rehabilitation expenses even where a supplementary health plan, such as a workplace plan, could pay them. Medication is the exception.
Can you sue the at-fault driver for lost income?
Yes, if someone else caused the crash. Ontario’s guidance on civil damages lists loss of earnings, past and future, among the losses you can claim. A pedestrian or cyclist found partly at fault recovers less, because the court apportions the damages by each side’s degree of fault.
There are limits. Under the Insurance Act, the at-fault driver generally isn’t liable for income you lose in the first seven days after the crash. After that, recovery for income lost before trial is limited to 70 per cent of your gross income loss. The award is also reduced by accident benefits for lost income, and by disability or income continuation payments, that you received or that were available to you before trial. Sick leave pay received before trial is deducted too.
A lawsuit also doesn’t pay week to week. Money usually arrives at the end, through a settlement or a judgment. If the at-fault driver has an Ontario auto policy, it has to cover liability of at least $200,000 for any one accident, not counting interest and costs.
If the driver who hit you had no insurance or can’t be identified, check first whether an auto policy you’re insured under can pay. Every Ontario auto policy has to cover bodily injury damages that a person insured under it is legally entitled to recover from the owner or driver of an uninsured or unidentified automobile. The Motor Vehicle Accident Claims Fund is the last resort when no other insurance is available. Ontario lists pedestrians and cyclists hit by an uninsured vehicle, and hit-and-run victims who can’t identify the other vehicle, among those who may be eligible.
What to do if you’re hurt without income replacement
Apply for accident benefits anyway. Tell the insurer you intend to apply no later than the seventh day after the circumstances that entitle you to the benefit arose, or as soon as practicable after that. If you aren’t insured under any auto policy, that’s usually the insurer of the car you were in or the car that hit you. Return a completed and signed application within 30 days after receiving the forms. A missed time limit doesn’t cost you the benefit if you have a reasonable explanation, but don’t count on that.
Check whether you have disability coverage or sick leave through work. It can pay while a lawsuit runs. Disability payments that were available to you can be deducted from a lost-income award even if you never collected them, so it’s worth applying.
Then keep a record of what you’re losing: pay stubs, T4s, tax returns, a letter from your employer confirming your hours and pay, a note of every shift you missed, and invoices or platform statements if you’re self-employed or do gig work.
Watch the clock on the lawsuit too. The Insurance Act sets conditions before an auto injury action can be started, including that you have applied for accident benefits and served written notice of the intended action on the defendant within 120 days after the incident, or within a longer period a court allows. If notice goes out late, no prejudgment interest is awarded for the time before it was served. Under Ontario’s Limitations Act, 2002, a proceeding generally can’t be started more than two years after the day the claim was discovered. Before you sign a release or give a statement to the other driver’s insurer, talk to a lawyer about your lost income claim.
- ·Income replacement is optional on policies entered into or renewed since July 1, 2026, but existing coverage carries over at renewal unless the named insured declines it in writing.
- ·For crashes since July 1, 2026, optional benefits only cover the named insured, their spouse, dependants and drivers listed on the policy.
- ·Medical, rehabilitation and attendant care benefits stay mandatory, and the Insurance Act’s priority rules decide which insurer pays them.
- ·Tell the insurer you intend to apply within seven days, or as soon as practicable, and return the completed application within 30 days of receiving the forms.
- ·Lost income can be claimed from the at-fault driver, but recovery for income lost before trial is generally capped at 70 per cent of the gross loss, and shared fault reduces it.
- O. Reg. 34/10: Statutory Accident Benefits Schedule, ss. 2, 3(1), 4.1, 7(1), 20.1, 25.1, 32, 34 and 47
- Insurance Act, R.S.O. 1990, c. I.8, ss. 251(1), 258.3(1) and (8), 265(1), 267.5(1), 267.8(1) and 268(2)
- Negligence Act, R.S.O. 1990, c. N.1, s. 3
- 2025 Ontario Budget, Chapter 1, Section B: Delivering Better Services
- Government of Ontario: Motor Vehicle Accident Claims Fund
- Ministry of the Attorney General: Future pecuniary damage awards
- Limitations Act, 2002, S.O. 2002, c. 24, Sch. B, s. 4
This article is general information, not legal advice, and every case turns on its own facts. If you have been injured, and especially in a matter involving car accidents, Shah & Shah Lawyers offers a free consultation.