ICBC asks for 6.3% increase to basic insurance rates
Public auto insurer projected to lose $890M this year
ICBC is asking for a 6.3 per cent increase to basic insurance rates, as the B.C. government attempts to address a "financial dumpster fire" at the public auto insurer.
The Insurance Corporation of B.C. will submit its application for the rate hike to the B.C. Utilities Commission Friday afternoon. If approved, the new rate would come into effect April 1 and will mean an average increase of under $60 a year.
Attorney General David Eby revealed last month that ICBC is set to lose $890 million this year, following a $1.3 billion net loss in 2017-18.
On Friday, he described the proposed rate increases as another consequence of "the financial crisis at ICBC left by the previous government." He claimed that the situation was so dire when the NDP came into power that without the measures his government has taken over the last year, the rate hike would have been closer to 40 per cent.
In January, Eby described the state of ICBC as a "financial dumpster fire," and warned drastic changes would be necessary.
In an attempt to stem the losses, the province has already rolled out a list of reforms including higher fines for repeat bad drivers, an independent dispute resolution system and a $5,500 limit on payouts for minor injuries.
"The changes being made at ICBC today are arguably the most substantial in the corporation's long history and to the auto insurance industry as a whole in this province," ICBC president and CEO Nicolas Jimenez said in a news release.
"While we acknowledge no rate increase is welcome news, it is encouraging to see these major reforms already having an impact on our insurance rates.
Eby has said the insurer is struggling with escalating costs of personal injury claims. According to ICBC, injury claims are projected to reach $3.67 billion in 2018.
Meanwhile, Liberal Leader Andrew Wilkinson called for a "complete overhaul" at ICBC, saying it was unfair to make drivers pay to rectify the insurer's financial problems.
"ICBC is a 45-year-old state-run monopoly and hasn't been fixed by any government," Wilkinson said in a news release.