What the IRB pays — and the formula behind it
The income replacement benefit (IRB) is the part of Ontario accident benefits that pays a weekly amount when a car-accident injury leaves you unable to work. It is defined in sections 4 through 11 of the Statutory Accident Benefits Schedule (O. Reg. 34/10).
The standard formula is 70% of your gross weekly employment income, up to a cap of $400 per week. So a worker earning $800/week gross qualifies for the full $400 (70% of $800 is $560, capped at $400); a worker earning $500/week gross qualifies for $350 (70%, below the cap).
That $400 weekly maximum has not changed in years. For anyone earning more than about $30,000 a year, the standard IRB replaces well under 70% of their actual income — which is why the optional buy-up tiers exist.
The waiting period and how long it lasts
The IRB does not start on day one. There is a seven-day waiting period before benefits begin, and the first payment covers the period starting after that week.
For the first 104 weeks (two years) after the accident, you qualify if the injury prevents you from doing the essential tasks of your own job. After 104 weeks, the test tightens: benefits continue only if you suffer a "complete inability to engage in any employment for which you are reasonably suited by education, training, or experience." Many disputed IRB files turn on that 104-week threshold.
If you are 65 or older, the benefit converts to a different, reduced structure rather than continuing at the full weekly amount.
Optional buy-ups — and why most people should look at them
Because the $400/week standard cap is low relative to real wages, every Ontario carrier sells optional IRB increases. The standard buy-up tiers raise the weekly maximum to $600, $800, or $1,000 — at correspondingly higher premiums.
The buy-up is priced off the higher weekly cap, not your actual income, so a higher earner gets more value from the same tier. Anyone whose household depends on their income, and who lacks strong private or employer long-term disability coverage, should price the buy-up before defaulting to the standard tier.
How the IRB coordinates with other income
The IRB is not stacked freely on top of every other source. Other post-accident income — most notably employer-sponsored short- and long-term disability payments, and certain CPP disability benefits — is deducted from the IRB. The IRB is, in effect, a top-up of last resort behind those sources.
This coordination is exactly why drivers with generous workplace disability coverage sometimes opt down the IRB: their employer plan would pay first anyway, reducing what the auto IRB adds. The risk is that workplace coverage can disappear with the job — and an auto accident that ends your employment can take the disability coverage with it.
What changes on July 1, 2026
The IRB is one of four benefits moving from mandatory to optional under the July 2026 SABS reform (alongside the non-earner, caregiver, and housekeeping benefits). Drivers will actively elect their IRB coverage — including the option to decline it — and that election is recorded on the new OPCF 47R.
Declining the IRB lowers the premium but removes the no-fault wage protection entirely. For a driver with no other disability coverage, that is a meaningful gap: after an accident that stops them working, there would be no weekly auto benefit at all. The reform makes the choice explicit; it does not make the underlying risk smaller.
Frequently asked
Is the income replacement benefit taxable?
No. The IRB is paid tax-free, which is why the formula uses 70% of gross income rather than 100% — it is designed to approximate take-home pay rather than gross earnings. Because it is not taxable, you do not report it as income.
Can I receive the IRB if I was self-employed?
Yes. Self-employed people can qualify, but the income calculation is more involved — it looks at your business income net of expenses, which can require tax returns and financial statements to document. Self-employed claimants should keep thorough records, as these files are more frequently disputed.
What happens to my IRB after two years?
For the first 104 weeks, eligibility is based on whether you can do your own job. After 104 weeks, the test changes to whether you have a complete inability to do any job suited to your education, training, and experience — a higher bar. Some claimants who received the IRB for two years are cut off at that mark, which is a common trigger for a Licence Appeal Tribunal dispute.
Does my employer’s disability coverage reduce my IRB?
Generally yes. Employer short- and long-term disability payments are deducted from the IRB, as are certain CPP disability benefits. The IRB tops up to its weekly limit behind those sources rather than paying on top of them — which is the main reason some drivers with strong workplace coverage consider opting down after July 2026.