B.C. drivers will see their ICBC premiums rise by almost five percent next year if a rate increase is approved by the B.C. Utilities Commission, but it could have been three times that, Transportation and Infrastructure Minister Todd Stone said Thursday.
Stone said government is working with the Crown corporation to ensure rates remain affordable, but that rising accident claims are the main contributor to the increase.
“The reality is that ICBC continues to face mounting costs as a result of the frequency, complexity, and severity of bodily injury claims, in addition to higher vehicle repair costs,” he said in a statement.
“In fact, the number of crashes in B.C. jumped from 260,000 in 2013 to 300,000 last year. Added to this, vehicles are more expensive to repair than ever before – vehicle damage costs totalled $1.36 billion in 2015 alone, up 17 percent from 2014. And injury claims topped $2 billion for the first time in 2014 and reached $2.4 billion last year.
The actual cost of those pressures would have required a rate increase of 15.5 percent, Stone said, who outlined moves to minimize the rate hike.
“We have directed a $472 million transfer from ICBC’s optional side of the business to offset the cost of basic insurance,” he said. “This $472 million transfer is part of the more than $1.4 billion ICBC has transferred from the optional side of their business to keep basic rate increases down since 2012.
ICBC has also introduced a new information technology system that forecasts $90–$100 million in savings per year, in addition to an enhanced fraud strategy, and has worked together to introduce tougher penalties for distracted driving.
The corporation has also hired 160 new claims staff earlier this year to help address the ongoing increase in injury claims and to improve customer service, and, ICBC plans to fill an additional 180 claims positions before the year is out.
“As a result of these combined efforts, we have managed to reduce the impact of the basic rate adjustment and ICBC will be seeking a 4.9 percent increase in its 2016 rate application to the British Columbia Utilities Commission – or an average of $3.50 a month,” Stone said.
Grouchy 1 says:
August 26, 2016 12:23pm
Laurel Robertson says:
August 25, 2016 05:26pm
August 25, 2016 04:26pm
Can you believe, it is cheaper to insure the same car by a senior driver in Los Angles, California than it is in Kamloops BC. That's the difference between a government controlled auto insurance system and a free market system.
Get use to it Kamloops, the Liberal spin machine is getting cranked up for the upcoming election, wouldn't you rather have the truth than to be feed mistruths, misrepresentations and the like.
Wouldn't it be great to have a government speak nothing but the truth all the time, and deal in nothing but the facts, what a novel idea.