Direct Compensation for Property Damage (DCPD)
All Albertans should be aware that the rules have been modified regarding personal injuries and vehicle damage that result from an auto accident in the province.
On Jan. 1, Alberta implemented a Direct Compensation for Property Damage (DCPD) system designed to improve how the province's insurers support customers following collisions. This approach is not new in Canada. In fact, Alberta is the last province or territory to adopt a version of a "no-fault" system. This change was made to provide consumers with a more efficient way to process vehicle damage claims.
Here is what you need to know about the new structure from an insurance and personal injury perspective.
DCPD What Do I Have to Do?
If your vehicle is already insured, you don't have to do anything to transition to the new system. DCPD does not alter your coverage in any way – except that some drivers will see their premiums change. According to the Insurance Bureau of Canada, 42 percent of drivers will see a small reduction in their premiums, while roughly 15 percent will see no change. The rest – just under 34 percent of drivers – will see an increase in their premiums of up to five percent.
To put it another way, owners of less-expensive vehicles that cost less to repair will pay less for their insurance. Conversely, those who own expensive vehicles that cost more to repair may see a premium hike.
Does DCPD Affect My Right to Sue?
DCPD applies to vehicle damage only, not physical injuries you may have sustained in a collision. If you are hurt in a motor vehicle accident, contact the experienced team at Kantor LLP to ensure that you obtain the compensation you need to help recover.
Thanks to Bill 41, which amended the Insurance Act, injuries such as sprains, strains or whiplash-associated disorders are considered minor, and damages settlements are capped at $5,000. The number of experts you can call after a motor vehicle accident is now limited when it comes to legal action. For damage claims of $100,000 or less, each party may only bring in one expert witness. If the damage claim is more than $100,000, a maximum of three expert witnesses may be called.
What Happens After I Get Into an Accident?
DCPD has changed the way accident claims are dealt with in Alberta.
- a driver not at fault for an accident will claim from their own insurer for damage to their vehicle and its contents instead of claiming from the at-fault driver's insurance – whether or not they have Section C coverage;
- a driver at-fault for an accident will continue to claim from their own collision coverage (if purchased); and
- a partially at-fault driver for an accident will have their claim split between their DCPD coverage and their collision coverage (if purchased).
If you don't have collision coverage, you will have to cover any costs for damage to your own vehicle out of pocket. You will need to pay the percentage of the vehicle repairs, equal to the percentage you are found responsible or at fault. In a situation where you are 50 percent at fault, you will pay half the damages, and 50 percent will be paid through your DCPD coverage.
The DCPD regulation sets out the rules for determining fault in more than 40 different accident scenarios. DCPD puts the onus of vehicle repair on their insurance provider for drivers at fault in a collision. Where an insured driver is 100 percent not at fault, their premiums will not be affected.
In essence, these changes will have the effect of reducing subrogation between insurers for automobile property damage. Subrogation occurs when your insurance company pays for an accident then works to recoup expenses from the at-fault driver's insurer.
DCPD How Are My Premiums Affected?
If you are responsible for an accident, your basic insurance premiums will likely increase. That means the costs for any optional insurance you carry (such as collision) may increase. Generally, the more accidents you are responsible for, the more you will pay in insurance.
One fundamental change under DCPD is you will pay a premium based on what vehicle you drive. Your insurer pays to repair your vehicle when you are not at fault. This is the main difference from the previous third-party liability coverage where your insurer was responsible for paying to repair someone else's vehicle if you were at fault.
AFTER AN ACCIDENT, CONTACT US
A personal injury lawyer can help guide you through your options and help you obtain the compensation you need to help you recover from any injuries. They can also make sure that your insurance company does not attempt to limit the compensation that you are owed. Schedule your Free Consultation by calling (403) 452-2011 or send a message to firstname.lastname@example.org. We will represent you on a contingency fee basis, so we do not get paid for our time and attention until we settle.