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ICBC announces significant update to insurance premiums

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Vincent Plana Aug 09, 2018 1:55 pm 93

Just moments ago, Attorney General David Eby, along with ICBC board chair Joy MacPhail, announced major proposed changes to how ICBC calculates insurance premiums.

The biggest announcement, above all, was a proposal to move to a driver-based system.

At-fault crashes will be tied to the driver, rather than the person who owns the vehicle.

“Right now, the system is broken,” says Eby. “A driver with no crashes could be paying the same premium as a driver with three at-fault crashes in a year.”

“Good drivers shouldn’t have to continue paying more to cover the costs for those who cause crashes or present a higher risk on the roads.”

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.

Other key proposed changes include:

  • Increasing insurance discounts for drivers with up to 40 years of driving experience, up from the current limit of nine years
  • New discounts available for vehicles with original, manufacturer-installed automatic emergency braking technology and for vehicles driven less than 5,000 kilometres per year

If approved by the British Columbia Utility Company, Eby estimates that the changes will benefit a two-thirds of ICBC’s customers. The remaining third will see their premiums increase.

“The changes will not increase the total funds that ICBC collects through basic policies, but instead will rebalance individual driver premiums and reset the way rates are determined.”

Other proposed changes include:

  • Basic insurance discounts for inexperienced drivers will be adjusted to more accurately reflect their risk
  • At-fault crashes will have a larger impact on insurance premiums
  • Rate classes and territories data will be updated to represent traffic density, population growth, and changes in urban infrastructure
  • An increase to the Driver Penalty Point (DPP) and Driver Risk Premium (DRP) programs of 20% in fall of 2018 and 20% in fall of 2019

ICBC is also proposing a transition cap that limits how much the premium can change annually.

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

The BC Government has ordered ICBC to file an application with the BCUC by August 15, 2018.

Should the application be approved, changes would come into effect by September of 2019.

more information to follow. 

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Vincent Plana
Gets his info on NHL prospects from playing Franchise Mode on NHL 18.

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