ICBC report says rates could climb 30% in next 2 years
An in depth report into ICBC, paints a grim picture of the public insurer.
A review by Ernst & Young, commissioned by the former government and released Monday warns drivers could face basic insurance increases of 30 per cent in the next two years unless the government overhauls the company's basic insurance program.
"The average driver in B.C. may need to pay almost $2,000 in annual total premiums for auto insurance by 2019, an increase of 30% over today's rates, assuming current trends persist." said the report.
"In summary, the B.C. auto insurance system has significant structural problems. However, based on the experience of other jurisdictions, there are proven solutions available — but this additional work needs to start now."
The report details drastic measures that could work to prevent huge increases, including making high risk drivers pay more, bringing back photo radar, capping payouts for pain and suffering for minor injuries and changing red-light cameras, so they also catch speeders.
During the election campaign, the NDP repeatedly called the situation at ICBC a mess and vowed to improve operations to prevent massive rate increases.
The NDP has ruled out a return to the controversial photo-radar system and implementation of no-fault insurance.
"This report makes it clear that ICBC has been in crisis for years, something which the former Liberal government largely ignored. Rather than addressing the serious issues facing the corporation, the B.C. Liberals used insurance fees as a rapidly growing hidden tax. Drivers have been paying the price," said Attorney General David Eby, who is also responsible for ICBC.
"I can assure British Columbians that help is finally here, as our government is committed to working with the public, ICBC's board, its executive and stakeholders to make rates affordable for people."
The 203-page report does not have a recommendations' section but does provide various options for what the insurer and government could do based on how much it wants to save in costs.
Some of the suggestions deal with changes that have been suggested before, like charging high risk drivers more but points out little has been done in more than a decade.
"ICBC has not incorporated any significant basic rate design changes since 2007, and as a result, a driver's individual basic premium no longer reflects the risk and cost imposed on the basic insurance system," read the report.
