The important points
- Under the DCA, each insurer is responsible for compensating their own policyholders for the property damage suffered, regardless of fault.
- The DCA applies to collisions in Quebec between at least two vehicles, and in which the owners are identified.
- The DCA assigns fault based on the Driver’s Fault Chart, which covers various possible accident scenarios.
What is the DCA?
The Groupement des assureurs automobiles (GAA) is the organization representing automobile insurers in Québec. Under section 173 of the Automobile Insurance Act, the GAA is required to establish a direct compensation agreement for physical damage to an insured’s vehicle. The DCA was designed to simplify and speed up claims, and to reduce the need for costly legal proceedings.1 Under the DCA, drivers involved in certain collisions receive compensation for physical damage directly from their own insurers.
In the event of a vehicle accident claim, insurers use the DCA to determine each driver’s responsibility or non-responsibility for the accident.2 In force since May 1, 1978, the DCA applies to collisions in Quebec between at least two vehicles, and in which the owners are identified.
The DCA does not apply to collisions that occur in other provinces or countries. It also doesn’t apply to hit-and-runs (which are covered under the public insurance plan), or accidents involving only one vehicle (like hitting a fence or a post).
The Driver’s Fault Chart
The DCA contains the Driver’s Fault Chart (DFC), which insurers must use to determine who’s at fault for a vehicle accident. The DCA covers various possible accident scenarios and establishes each driver’s fault. Insurers use the DFC to examine the details surrounding the collision and to determine each driver’s responsibility. Following this assessment, a driver may be found 0%, 50% or 100% responsible.
The DFC covers 15 collision scenarios, including collisions between vehicles travelling in the same direction, travelling in the opposite directions or entering from side roadways or intersections. The DFC takes into account the Highway Safety Code and jurisprudence.3
No-fault insurance
The DFC is used to establish responsibility or fault. Quebec’s public automobile insurance plan provides no-fault injury coverage for all residents of Quebec, regardless of who is responsible for a given accident. This means that Quebecers who are involved in a traffic accident in Quebec have their injuries covered by the provincial plan, regardless of responsibility. Consequently, individuals or companies cannot take legal action against the person responsible for a traffic accident.4
When it comes to physical damage, however, is when the insurance companies become involved.
Compensation
Private insurers consider an insured’s responsibility for an accident by using the DFC. Depending on the details of the collision, a driver may be found 0%, 50% or 100% responsible. This fault determination is important when determining whether damage to the insured vehicle will be covered.
When a policyholder is not at fault, damage to their vehicle will be covered under Section A (one-way coverage). If they are at fault, damage will only be covered if they purchased optional Section B collision or upset coverage (two-way coverage). In either case, they deal only with their own insurance provider.
This system means that the at-fault party (or their insurer) doesn’t compensate the not-at-fault party for the damage, as would happen in other jurisdictions.3
Example
Let’s consider an accident where the damage to Thomas’ vehicle is evaluated at $1,500. After consulting the DFC, the insurer determines that Thomas is 50% at fault for the accident, and another driver is at fault for the other 50%. Under Section A, Thomas will be compensated 50% of the loss, the portion for which he’s not at fault: $750. There is no deductible for Section A coverage.
Thomas will be reimbursed the remaining 50% (the part for which he is at fault) only if he had purchased optional collision or upset coverage (Section B). Let’s say he did, and he had a $500 collision deductible for this coverage. Since this coverage only applies to 50% of the claim, he only pays 50% of the associated deductible.1
The math to determine his total compensation looks like this:
Total loss:
$1,500
50% not-at-fault coverage:
$750
50% at-fault coverage:
$750 – (50% of $500 deductible, or $250) = $500
Total coverage:
$750 not-at-fault + $500 at-fault = $1,250
So, altogether, Tomas pays just 50% of his collision deductible, or $250, for the $1,500 repairs. His insurer pays the remainder. If he were 25% or 75% at fault, it would change his deductible payment accordingly.
Commonly asked questions
In Quebec, can I sue the other driver if I’m involved in an accident?
No. Under the DCA, no claim may be made against a third party responsible for an accident. The Automobile Insurance Act ensures that a driver who is not responsible or not at-fault for an accident is compensated by their insurer for material damage to their vehicle. An unsatisfied insured can only sue their own insurance company.2
What are some of the benefits of the DCA?
The DCA has simplified and accelerated the claim settlement process in Quebec. It has also reduced costs; approximately 90% of claims are settled without legal action.2
Does the DCA apply to collisions between vehicles that are owned by the same person?
No. The vehicles involved in the collision must belong to different owners. Also, the DCA does not apply if a vehicle owner collides with a vehicle they own while driving a different vehicle.5
Sources
- Autorité des marchés financiers. “Automobile Insurance.” lautorite.qc.ca, lautorite.qc.ca/en/professionals/insurers/automobile-insurance. Accessed 28 November 2024.
- Insurance Bureau of Canada. “Auto Insurance.” bac-quebec.qc.ca, bac-quebec.qc.ca/en/insurance-stakeholders/auto-insurance/. Accessed 28 November 2024.
- Groupement des assureurs automobiles. “Direct Compensation Agreement at a glance.” gaa.qc.ca, gaa.qc.ca/en/direct-compensation-agreement/at-a-glance. Accessed 28 November 2024.
- Société de l’assurance automobile du Québec. “Public Automobile Insurance Plan.” gouv.qc.ca, saaq.gouv.qc.ca/en/traffic-accident/public-automobile-insurance-plan/in-brief. Accessed on November 28 2024.
- Groupement des assureurs automobiles. “Direct Compensation Agreement: identifying your loss.” gaa.qc.ca, gaa.qc.ca/en/direct-compensation-agreement/identifying-your-loss. Accessed 28 November 2024.
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About the expert: Daniel Mirkovic
A co-founder of Square One with 25 years of experience in the insurance industry, Daniel was previously vice president of the insurance and travel divisions at the British Columbia Automobile Association. Daniel has a bachelor of commerce and a Master of Business Administration (MBA) from the Sauder School of Business at the University of British Columbia. He holds a Canadian Accredited Insurance Broker (CAIB) designation and a general insurance license level 3 in BC, Alberta, Saskatchewan, Manitoba and Ontario.
