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What you need to know about no-fault insurance in Ontario
KEY FINDINGS
- Ontario’s no-fault insurance system lets drivers file accident claims with their own insurer, regardless of who caused the collision.
- As of July 1, 2026, Ontario’s no-fault rules remain unchanged, but several accident benefits have become optional instead of automatically included.
- Insurers use Ontario’s Fault Determination Rules to assign responsibility for crashes, which can affect deductibles and future insurance premiums.
- Reducing optional accident benefits may lower premiums, but it can leave drivers exposed to significant out-of-pocket costs if seriously injured in a collision.
Updated on July 8, 2026 by Arshi Hossain | Originally written: October 26, 2024 by Liam Lahey
No-fault insurance in Ontario allows drivers to file claims with their own insurer after a collision, regardless of who is to blame. It determines how fault is assigned, how benefits are paid, and how accidents can impact your premiums.
While the system itself hasn't changed, as of July 1, 2026, which accident benefits are automatically included in your policy has. Here's what that means for Ontario drivers.
What is no-fault insurance?
No-fault insurance in Ontario allows drivers involved in an accident to each file claims with their own car insurance provider to pay for vehicle damages and injuries quickly.
Insurance companies are required by law to assign a percentage of the blame to each motorist involved in a collision. Sometimes, only one driver is found at-fault and the other is deemed not-at-fault; other times, both drivers share fault to varying degrees.
No-fault insurance systems also operate in Quebec, Nova Scotia, New Brunswick, and Prince Edward Island. Alberta, meanwhile, has passed legislation to adopt its own no-fault 'Care-First' model starting January 1, 2027.
Learn more: When won’t an at-fault collision impact your car insurance rate?
Does no-fault insurance still work the same way after July 1, 2026?
Yes. Ontario’s no-fault insurance model isn't changing on July 1.
Ontario's July 1, 2026 auto reforms, regulated through Ontario's Financial Services Regulatory Authority (FSRA), retain fault determination, the claims process, and your right to file with your own insurer after a crash.
What's changing is which accident benefits are bundled into your policy automatically, and which coverage options you now can choose.
| Accident benefit | Status after July 1, 2026 | What it covers |
|---|---|---|
| Medical benefits | Mandatory | Medical treatment and healthcare expenses following a collision |
| Rehabilitation benefits | Mandatory | Recovery services such as physiotherapy and rehabilitation programs |
| Attendant care benefits | Mandatory | Personal care assistance for accident-related injuries |
| Income replacement | Optional | Partial income replacement if injuries prevent you from working |
| Caregiver benefit | Optional | Helps cover costs if injuries prevent you from caring for dependants |
| Non-earner benefit | Optional | Financial support for eligible students or unemployed individuals whose daily lives are disrupted by injuries |
| Housekeeping and home maintenance | Optional | Assistance with household tasks you can no longer perform because of accident-related injuries |
| Death and funeral benefits | Optional | Financial support for surviving family members and funeral expenses |
Sources: Financial Services Regulatory Authority of Ontario (FSRA) and Insurance Bureau of Canada (IBC).
In short: Ontario’s no-fault insurance format remains unchanged. However, coverage options included by default have shrunk and you get to customize your accident benefits.
Read more: Will July 1 auto insurance reforms in Ontario impact you?
How do insurers determine fault in the no-fault system?
After an accident, insurance companies in Ontario apply the province’s fault determination rules. These detailed set of guidelines assign blame across a wide range of collision scenarios. Other provinces maintain their own versions of these rules.
If your insurer finds you responsible for an accident, you can dispute the decision by filing a complaint and requesting a review. If your insurance company declines, you can escalate their decision to its ombudsperson for an independent investigation.
If ombudsperson sides with the insurer's original decision, your last avenue is Canada's General Insurance OmbudService (GIO), which can help broker a resolution. Not every insurer participates in GIO, and any insurer can decline to accept its proposed outcome.
Is no-fault insurance good for drivers?
Before no-fault insurance began in Ontario in 1990, recovering damages after an accident required suing the other driver. This slow, expensive process left people waiting on the courts while their vehicle sat damaged or repair bills piled up.
No-fault insurance replaced this model with something faster. Now, insurers pay their customers’ claims directly, covering vehicle repairs, health care, and rehabilitation costs without waiting for a liability ruling from the courts. This updated system also helps keep overall insurance premiums lower by discouraging costly legal battles. As a result, insurance companies save money and pass those savings to customers.
How does no-fault insurance affect your premiums?
If you’re found at-fault partially or entirely in an accident, and carry collision coverage, you'll need to pay your deductible before your insurer covers the balance of repair costs. An at-fault collision stays on your driving record for up to six years, and typically pushes your premium up at renewal, unless you have purchased an accident forgiveness endorsement.
Even then, that protection only covers you once as fault findings are visible to other insurers. Still, shopping around after an at-fault accident is still worthwhile, as some insurers may be more forgiving than others.
What's new is a second lever on your premium: which optional benefits you keep. Dropping income replacement, caregiver, or housekeeping coverage to lower premiums is now a choice for drivers, but a real risk if they underestimate potential payouts out-of-pocket in the event of a collision.
While your driving record determines your base premium the most, your benefit selections now shape what you're actually protected for in the event of an accident. Cutting these benefits for modest savings can leave you underinsured and at risk of unexpected six-figure out-of-pocket expenses if you're seriously injured in a crash.
Read next: How a car accident affects your insurance premium
Frequently asked questions (FAQ)
Does no-fault insurance mean no one is found responsible for an accident?
No. Ontario's no-fault insurance system only determines how claims are paid. Insurers still assign fault using provincial Fault Determination Rules, and at-fault drivers may face higher premiums.
Can you sue another driver under Ontario's no-fault insurance system?
In some cases, yes. Drivers may be able to pursue legal action for serious injuries or losses that exceed insurance coverage, subject to Ontario's insurance laws and thresholds.
Do all Ontario drivers need accident benefits coverage?
Yes. Medical, rehabilitation, and attendant care benefits remain mandatory. However, several other accident benefits became optional for new and renewing policies starting July 1, 2026.
Will my insurance go up if I'm partially at fault for a collision?
It can. A partially at-fault ruling in an accident may affect your insurance premiums, depending on the degree of blame assigned and your insurer's underwriting rules.
Should I remove optional accident benefits to save money?
While removing optional benefits can lower your premium, it may also reduce your financial protection after a serious accident. Drivers should carefully assess their needs before reducing coverage.
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Liam Lahey, Freelance writer
Liam Lahey is a versatile marketer with experience as a staff and freelance writer for many business and technology publications and newspapers. He previously worked as the editor and media spokesperson for Rates.ca, handling home, auto, and travel insurance topics.
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