Ontario drivers weighing whether to drop the accident benefits that became optional on July 1 may be trading a negligible premium saving against more than $50,000 their family would need after a fatal crash, according to Erin Bury (pictured), co-founder and CEO of Willful, an online estate planning platform.
The reform made several previously automatic benefits optional, including income replacement, caregiver support, and funeral and death benefits. Bury said the change carries an unexpected silver lining: many Ontarians are learning for the first time what their auto policy actually contained.
"I had no idea that these were even included in my insurance policy to begin with," she said. "At the very least, this has probably taught people about the fact that death benefits are included in their car insurance policy."
The risk, she said, is what people do with that knowledge. Dropping the benefits to trim a monthly premium leaves a gap that surfaces at the worst possible moment, because a death comes with immediate, out-of-pocket costs most families have never had to price: disposing of the body through cremation or burial, a celebration of life, replacing lost income, and starting processes like probate.
"There's usually a cash outlay that loved ones have to pay for immediately," Bury said. "Anything that could help close that gap when someone passes away is crucial."
For a family without workplace or private life insurance, she said, the auto policy benefits could represent the only money available for those costs.
"To me, I have a huge concern that people won't understand how meaningful this could be and how many costs there are when someone passes away," Bury said. "They might choose short-term gain but risk long-term pain."
Bury laid out the arithmetic of what the death benefit provides. A surviving spouse would receive $25,000 in cash and each dependent child $10,000, with up to $6,000 more toward funeral costs – meaning a family with two children would be walking away from more than $50,000 in coverage.
Against that, the costs arrive fast: cremation typically runs $1,000 to $2,000, burial more once a coffin and plot are counted, and a funeral itself can reach $10,000 to $20,000 depending on the send-off. Families that haven't been through the death of a loved one often don't know those numbers, she said – the funeral and burial costs, or how much cash is needed to deal with it all.
The savings on the other side of the trade are modest, with estimates suggesting premium reductions of just under 10 per cent on average. The benefits at stake go beyond the lump sums: income replacement alone provides up to $400 a week.
"Think about the money that I might save on my car insurance," Bury said. "I don't even think I would save $1,000 over the next 10 years. So it's just not worth it."
Bury said the people best positioned to opt out are those who already know money would flow to their family from another source, such as a private term life policy. But she cautioned against leaning on the workplace piece alone.
"You might have life insurance through your workplace. But what happens if you get laid off tomorrow? That's gone," she said. "And then your family's left with nothing."
Her test for readers is straightforward: without term life insurance, savings, or another source that would both cover funeral and burial expenses and replace lost income, the optional benefits should stay on the policy.
"Then you should never omit these," Bury said, "because these could be crucial in the event of a car accident."
Asked what families should do before anything happens, Bury's first answer was inaction. "I would not touch my car insurance policy," she said. "I would leave those benefits in, and hopefully you never have to use them, but they're there."
Beyond the policy itself, she pointed to two documents that work in tandem with auto coverage. A will dictates wishes, names an executor and directs where money goes, letting the estate move immediately without extra legal costs or government decisions. A power of attorney covers the scenario the death benefit does not: a crash that leaves someone alive but incapacitated, with an appointed person able to make medical and financial decisions.
"This is hugely important in tandem with your car insurance," Bury said. "You hope it never happens, but it's there if it does."
