BC government announces changes to how ICBC will calculate premiums

Car crash | Stock Image

Car crash | Stock Image

"Strangely, those motorists are not facing a system that unfairly labels majority as "bad drivers" and forces them to pay very high insurance rates".

If the proposed changes are approved by the B.C. Utilities Commission, they would come into effect in September 2019.

The province and ICBC are proposing big changes to the way insurance premiums are determined.

Similarly, at-fault accidents will have a larger impact on a driver's premiums than they now do, but one at-fault crash will continue to be forgiven over a period of 10 years.

"We hope and are advised that this legislation might get ICBC back in the black, which means that the savings are in the neighbourhood of $1 billion", Eby said.

Most customers are expected to transition to their new basic premium within three years.

Inexperienced and high-risk drivers would pay more for their vehicle insurance in British Columbia under proposed changes to modernize the province's Crown auto insurance corporation.

Increasing insurance discounts for drivers with up to 40 years of driving experience, up from the current limit of nine years.

"Eight out of 10 drivers can't possibly have the same risk profile, especially when crashes on our roads are at an all-time high", she said.

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The changes announced Thursday stem from an online survey conducted earlier this year asked B.C. residents what changes they'd like to see in the way rates are calculated.

According to Eby, about two-thirds of drivers will see lower premiums as a result of the changes.

Around 80 per cent of drivers are now eligible for the maximum discounts under the Insurance Corporation of British Columbia, a situation officials say doesn't reflect the reality on the roads. The remaining third will see their premiums increase.

17% of all drivers - more than $100 increase.

Mr. Eby said under ICBC's proposal, less-experienced drivers - those who have been driving for less than 15 years - would see an increase in their premiums. We heard from British Columbians that their insurance rates need to be fair and we agree.

Mr. Eby has said the former Liberal government hid the financial mess at ICBC and avoided the hard measures needed to restore its balance sheet.

Andrew Wilkinson, leader of the Opposition Liberals, accused the NDP government of doing little to fix the problems at ICBC.

ICBC's current rate structure is more than 30-years-old and was build around insuring the vehicle, rather than the driver, and allowed discounts to drivers despite having multiple crashes. Separately, the government has also directed ICBC to move the timing of its basic insurance rate application to the BCUC from late August to December to align any rate change with the other product changes already announced.

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