Direct Compensation and Section 258 Claims in Ontario: Recovering from Your Own Insurer

What Is Direct Compensation — Property Damage?

Ontario’s Insurance Act (section 263) establishes a direct compensation — property damage (DCPD) scheme allowing not-at-fault accident victims to claim certain losses directly from their own insurer rather than from the at-fault driver’s insurer. The scheme was implemented to reduce inter-insurer litigation and streamline property damage recovery for not-at-fault claimants.

What DCPD Covers

DCPD covers damage to your vehicle and its contents, and the loss of use of your vehicle, arising from a not-at-fault Ontario motor vehicle accident. DCPD applies when: the accident occurs in Ontario; the other vehicle is identified and insured in Ontario; and the insurer accepts that you were not at fault under the standard fault determination rules. Your own insurer compensates you as if they were the at-fault driver’s insurer.

The Fault Determination Rules

Ontario’s Fault Determination Rules (O. Reg. 668/03) establish a standardized matrix of accident scenarios with prescribed fault allocations. These rules apply to all DCPD claims. Where the accident scenario maps onto a specific rule, fault is allocated according to prescribed percentages. Disputes about fault allocation under the DCPD regime can be pursued through FSRA arbitration.