Following a damning report leaked yesterday that the Insurance Corporation of British Columbia (ICBC) could be raising auto insurance rates by almost 30% in the near future, BC’s attorney general promised that no such hike would happen under his watch.
The previous Liberal government had commissioned Ernst & Young to prepare the report in May, which was kept hidden from the public. However, the report was leaked, and highlighted that the ICBC is in dire financial straits, and it concluded that drastic measures had to be taken to maintain the insurer’s sustainability. Postmedia News managed to obtain a copy of the report, and disclosed its details to the public yesterday.
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Attorney General David Eby, the minister responsible for the ICBC, assured drivers that the rate increase – expected to occur in two years – will not happen while he is in charge. The Canadian Press reported that the Attorney General held a conference yesterday and was critical of the previous administration, blaming the Liberals for the ICBC’s current predicament.
“This is a very serious and a very grave concern,” Eby said. “We will take the steps necessary to fix what is happening at ICBC, to make British Columbia’s roads safer for British Columbians and to ensure that rates are affordable for British Columbians, because clearly that is not where we are tracking right now.”
According to the leaked report, a surge in the number of car collisions and an increase in the cost of vehicle repairs and injury claims are some of the reasons why the ICBC is currently in a tight fiscal spot. The previous administration’s attempts to shield customers from rate increases also came back to bite the insurer, the report revealed.
The report calls for a number of measures to restore the insurer’s sustainability – proposed solutions include limiting payments for pain and suffering, charging high-risk drivers more for insurance, charging higher for luxury cars, and re-implementing photo radars.
Eby dismissed a number of the report’s recommendations and criticized the previous administration for treating the ICBC as a “bank machine” by withdrawing money from the insurer to make the province’s overall finances appear healthier.
“ICBC has been careening toward a crisis over at least the last couple of years. This should have been an election issue,” Eby stated. “Our goal is to make roads as safe as possible and to make sure that rates stay affordable for British Columbians, and that’s what we’ll be doing. It was not a priority of the previous government, obviously.”
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