What is it?
Ontario has a "no-fault" car insurance system. But this doesn't mean that no one is at-fault in an accident. "No-fault" insurance means that if you are injured or your car is damaged in an accident, then you deal with your own insurance company, regardless of who is at-fault. You don't have to go after the at-fault driver for compensation.
Similarly, if any passengers in your car is injured, then he/she has a car insurance policy of his/her own will approach his/her own insurance company for benefits. If your passengers don't have a car insurance policy of their own, then your insurance company may pay benefits to them. The driver of the other car involved in the accident will claim benefits from his/her own insurance company.
How does it work?
Someone is always deemed to be "at-fault" in a car accident, whether partly or fully. The law requires insurance companies to assign the percentage of fault for each of the drivers involved in the accident. This is done by using the "Fault Determination Rules".
These rules, which are set out in a regulation under the Insurance Act, help insurance companies deal with accident claims quickly and economically. The Fault Determination Rules differ from any charges laid by the police under the Highway Traffic Act.
Here's an example
Say you were unable to stop your car on an icy road. You rear-ended another car and the police officer told you that "no one was at-fault". This usually means that no police charges will be laid. It does not mean that the insurance companies involved will not consider who was at-fault. In this case, the insurance company would apply the Fault Determination Rules. This states that a car that rear-ends another car is at-fault (since drivers are required to take road conditions into consideration).
Your percentage of fault will determine the amount of deductible you have to pay. Generally, if you're fully or partially at fault in an accident, insurance companies will increase your premiums at your next renewal date.
What to do if you don't agree
Don't agree with the way in which your insurance company has determined fault? Then contact the person your insurance company has appointed to deal with consumer complaints. This is usually the company's Ombudsman Liaison Officer. If your complaint is still not resolved, you may contact the Ontario Insurance Ombudsman. If you're still not satisfied with your insurance company's position, you may choose to go to court.