In general terms, liability coverage protects against legal liability for bodily injury to persons or property damage of others when there is proven negligence on the part of the owner or operator of the vehicle. Each province has their own specific criteria for deciding when an injured party may sue an owner or operator of a vehicle for injuries.
When the damage is to the insured automobile, a vehicle owner in Ontario, New Brunswick and Nova Scotia is indemnified through the direct compensation property damage coverage (a.k.a. DCPD) by claiming against their own insurer.
This coverage protects the insured as defined by the policy for injuries to themselves and anyone considered to be an “occupant” in a loss involving the insured automobile. Coverage is not based on fault, meaning that it doesn’t matter who was at fault for the accident.
Each province has a unique way of providing protection, but the types of benefits are consistent.
Every province except Saskatchewan provides this very generous coverage. It responds where an insured would have been entitled to sue a third party for injuries or property damage, but the third party does not carry valid insurance. It allows for the insured to collect under their own policy, under this section, in place of what would usually be available on responsible third-party’s automobile liability policy.
For property damage recovery, the third-party driver must be identified, but not insured.
For bodily injury/death, the third-party driver of the other automobile must be unidentified and therefore uninsured.
Direct Compensation/Property Damage (DCPD)
Watch this video to learn about the direct compensation/property damage coverage.
Let’s check your understanding. What did you learn in this section?
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