Transportation Minister Todd Stone said Monday a potential 6.7 per cent hike to ICBC basic rates is too high but gave no indication of whether the government would reduce the dividend it takes from the public auto insurer.

Transportation Minister Todd Stone said Monday a potential 6.7 per cent hike to ICBC basic rates is too high but gave no indication of whether the government would reduce the dividend it takes from the public auto insurer.

ICBC may hike basic insurance rate 6.7 per cent

Soaring injury costs to drive up basic premiums at B.C.'s public auto insurer

The Insurance Corp. of B.C. is warning motorists they’ll soon pay more for basic auto insurance.

Because of a rate smoothing policy introduced by the province in 2013, this year’s rate hike must be between 3.7 and 6.7 per cent – within 1.5 per cent of last year’s 5.2 per cent increase on basic rates.

ICBC president and CEO Mark Blucher said the initial calculations suggest the maximum 6.7 per cent basic rate hike is required, but pledged to work with the government to find ways to reduce that number by Oct. 30, when the formal rate application is to be filed with the B.C. Utilities Commission.

He said ICBC is grappling with “an unexpected and rapid escalation in the number of injury claims being reported to us in recent months.”

ICBC’s bodily injury claim costs, which cover pain and suffering, future care and loss of wages, are forecast to hit $2.3 billion this year, up 64 per cent since 2008.

Higher legal and medical costs, more represented claims and more complex, catastrophic claims leading to bigger settlements are among the factors blamed for the jump.

Injury claims are up 10 per cent from a year ago even though the number of crashes is unchanged. ICBC says more fraud is one potential explanation, as well as more minor soft tissue injury claims.

If regulators approve the request, this will be the fourth straight year of basic insurance premium increases following hikes of 11.2 per cent in 2012 and 5.2 per cent in each of 2013 and 2014.

ICBC has simultaneously reduced its optional insurance rates – on which it competes against private insurers – in five of the last seven years.

ICBC spokesman Adam Grossman said the net effect is the average customer has seen their overall auto insurance costs rise by less than 10 per cent since 2008.

Grossman said this year’s required increase would actually be “on the order of 12 per cent” were it not for the constraint of the rate smoothing policy.

Transportation Minister Todd Stone said even the maximum 6.7 per cent this year is too much.

“We believe that’s not acceptable and the rate can and should be lower than that,” he said Monday.

Stone appointed ferries commissioner and former deputy minister Gord Macatee to help ICBC pare the hike.

Asked if the province might reduce the annual $160-million annual dividend it extracts from ICBC each year, Stone said those transfers are from ICBC’s excess capital on its optional insurance business and do not affect basic rates.

He acknowledged an optional rate cut would help ease the pain for the majority of motorists who also buy their optional coverage from ICBC, but made no commitment to enable that.

The Bank of Canada’s recent interest rate cut has significantly reduced the projected returns of ICBC’s investment portfolio, Stone added.

ICBC RATE CHANGES and GOV’T DIVIDENDS | Create infographics

Just Posted

The Kootenay International Junior Hockey League met for their AGM and announced a number of new initiatives, new awards and changes in their executive committee, as well as the starting date for the 2021-22 season. Paul Rodgers file.
KIJHL announces start dates for 2021-22 season

Season set to begin Oct. 1 with league still following all health guidelines

South Slocan’s Ti Loran is among the recipients of this year’s Neil Muth Memorial Scholarship. Photo: Submitted
Neil Muth Memorial Scholarships awarded to 4 students

Students in Creston, South Slocan and Revelstoke are sharing the honour

The Independent Investigations Office of BC is looking into a Castlegar incident. File photo
Police watchdog investigating Castlegar incident

IIO: Woman sustained a reportedly self-inflicted injury

A wildfire near Cottonwood Lake was put out by Nelson firefighters Sunday night. Photo: Submitted
Wildfire extinguished near Cottonwood Lake

Lightning-caused fire was near one of Nelson’s water sources

West Kootenay Regional Airport. Photo: Betsy Kline
Central Mountain Air leaving Castlegar airport in July

The airline says market can’t handle two airlines

Canadian Prime Minister Justin Trudeau participates in a plenary session at the G7 Summit in Carbis Bay, England on Friday June 11, 2021. THE CANADIAN PRESS/Adrian Wyld
Canada donating 13M surplus COVID-19 vaccine doses to poor countries

Trudeau says the government will pay for 87 million shots to be distributed to poor countries

The BC Ferries website went down for a short while Monday morning following a provincial announcement that recreational travel between health authorities can resume Tuesday. (Black Press Media file photo)
BC Ferries’ website crashes in wake of provincial reopening announcement

Website back up now, recreational travel between health regions to resume as of Tuesday

The Kamloops Indian Residential School is photographed using a drone in Kamloops, B.C., Monday, June, 14, 2021. The remains of 215 children were discovered buried near the former school earlier this month. THE CANADIAN PRESS/Jonathan Hayward
Communities grapple with what to do with former residential and day schools

Some tear them down as a tool to help healing, others repurpose them as tools for moving forward

FILE – Provincial health officer Dr. Bonnie Henry talks about B.C.’s plan to restart the province during a press conference at Legislature in Victoria, Tuesday, May 25, 2021. THE CANADIAN PRESS/Chad Hipolito
B.C. officials watching U.K.’s Delta variant struggles, ‘may need to slow’ restart plan

Studies show that one dose of vaccine is only 33 per cent effective in preventing B.1.617.2 spread

RCMP Const. Shelby Patton is shown in this undated handout photo. RCMP say that Patton was hit by an allegedly stolen truck that he had pulled over on Saturday morning in Wolseley, east of Regina. THE CANADIAN PRESS/HO, RCMP
Pair charged in Saskatchewan Mountie’s death make first court appearance

Const. Shelby Patton was hit by an allegedly stolen truck that he had pulled over Saturday morning

David and Collet Stephan leave for a break during an appeal hearing in Calgary on Thursday, March 9, 2017. THE CANADIAN PRESS/Todd Korol
Appeal Court rejects stay for Alberta couple facing third trial in son’s death

Pair accused in their earlier trials of not seeking medical attention for their son sooner

Highway notices like this come down effective June 14. Public health restrictions on non-essential travel and commercial operation have hit local businesses in every corner of B.C. (B.C. government)
Province-wide travel back on in B.C.’s COVID-19 restart plan

Gathering changes include up to 50 people for outdoor events

Calgary Stampeders’ Jerome Messam leaps over a tackle during second half CFL western semifinal football action in Calgary, Sunday, Nov. 15, 2015.THE CANADIAN PRESS/Jeff McIntosh
CFL football will be played this summer in Canada

Governors vote unanimously in favour to start the ‘21 campaign on Aug. 5

Citizenship Minister Marco Mendicino holds a press conference in Ottawa on Thursday, Nov. 12, 2020. The federal government is announcing that Indigenous people can now apply to reclaim their names on passports and other government documents. THE CANADIAN PRESS/Sean Kilpatrick
Indigenous people can now reclaim traditional names on their passports and other ID

Announcement applies to all individuals of First Nations, Inuit and Métis background

Most Read