The Insurance Corporation of British Columbia (ICBC) will emerge out of the red ink next year, based on the provincial government’s latest budgetary forecast.
The 2020 budget released today shows ICBC will see a surplus of $86 million in 2020/21, growing to $148 million in 2021/22 and $191 million in 2022/23. This follows the projected deficit of $91 million in 2019/20, and the recorded steep losses of $889 million for 2016/17, $1.3 billion for 2017/18, and $1.18 billion for 2018/19.
The last time ICBC was in the black was in 2015/16, when it saw a surplus of $131 million.
“Our government has taken significant steps to help address sustainability at ICBC and affordability for British Columbians,” said BC finance minister Carole James in her budget speech. “While the old government ignored the problems with auto insurance, we are transforming ICBC to make it work for you.”
The positive forecast for ICBC starting in 2020/21 is due to a number of already-announced policies in April 2019, including the basic rates increase, and the new limit of $5,500 on pain and suffering for minor injury claims.
Further steps were taken earlier this month, when the provincial government announced its plan to eliminate most of the legal fees and other costs associated with the current litigation-based claims system. Over $1.5 billion in ICBC’s current costs will be reduced in the first full year of changes, with the savings passed on to ICBC customers through lowered insurance rates, and providing maximum care and treatment benefits for anyone injured in a crash without having to hire a lawyer.
This no-fault, care-based system, deemed as the single largest policy shift in the crown corporation’s history, will take effect on May 1, 2021.
Furthermore, the budget is based on a 0% rate increase effective April 1, 2020.
- See also:
- BUDGET 2020: All streaming subscribers, such as Netflix, to pay new BC sales tax
- BUDGET 2020: BC Government introduces tax on carbonated sugary beverages
- BUDGET 2020: New income tax for BC’s top 1% richest residents
- BUDGET 2020: New integrated Fraser Valley commuter rail and housing study to move ahead
- BUDGET 2020: New BC student grant program of up to $4,000 annually
- Province introduces legislation to lower ICBC premiums by approximately 20%