In the early 2000’s, the insurance industry was in a cyclical low of profitability. The industry argued that escalating injury claims were the cause, that legislative reforms were needed to cap the compensation available to injury victims, and that without such reforms Alberta’s auto insurance industry would not be sustainable. By 2004, the insurance industry’s profits had recovered, but momentum for new legislation was in place and the minor injury law was introduced in Alberta.
After years of overreach by insurers in terms of the application of the law, and subsequent litigation, the courts have clarified that the cap only applies to minor soft tissue injuries of short duration. In other words, the courts have applied the minor injury cap as it was intended. These Court decisions have prompted the insurance industry to lobby the government to expand the definition of the minor injury cap.
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