The B.C. government announced Wednesday it will lead an audit of the Insurance Corporation of British Columbia (ICBC), after reports some auto shops have been inflating repair costs.
In a statement, Attorney General David Eby said the government has hired an accounting firm, PwC Canada, to identify waste and find ways to prevent fraud and overbilling at the Crown corporation.
"ICBC will not be back on the road to financial sustainability or in a position to provide affordable rates to British Columbians without major changes at every level," said Eby in a statement.
The audit comes after reports that some auto body shops were overbilling for repairs.
Claims of overbilling at ICBC
Early Wednesday morning, the union representing ICBC workers put out a statement claiming some auto body shops have been inflating the cost of repairs under the express repair program.
That program allows customers to go directly to an auto shop for an estimate, which is then passed on to ICBC for approval.
Annette Toth, vice-president of MoveUP, said several of its members have told her that due to the high volume of claims, ICBC employees often don't have a chance to take a second look at the costs.
"Our estimators are constantly trying to correct it," said Toth.
"There's not enough people to do the checks and make sure the body shops are being fully accountable."
Some auto shops said they think the rising cost of car parts is contributing to the increase in repair costs. They say claims of overbilling are overblown.
"They think we're exaggerating the estimates, but we're really not. We're doing what the manufacturers are requiring us to do," said Rick Hatswell, Chief Operating Officer for Craftsman Collision, which is an ICBC-approved repair shop.
Hatswell said Craftsman Collision and all other ICBC-approved repair shops use a computer-based system to determine repair estimates in accordance with manufacturing standards.
In a statement, ICBC said it has not seen any evidence of fraud happening at repair shops, but said getting staff to check each individual claim can be time consuming and inconvenient to customers.
The provincial auto insurance corporation is projecting an $800 million deficit by the end of this year, according to budget documents.
The government's final report will be made public in early 2018.