B.C public insurer bows to pressure to release rate projections

B.C public insurer bows to pressure to release rate projections

B.C public insurer bows to pressure to release rate projections The Insurance Corporation of B.C. (ICBC) has released projections of a worst-case scenario rate increase of 42% by 2020, bowing to pressure from the B.C. Utilities Commission (BCUC) to provide clarity on expected annual increases in the next four years.

ICBC released the figures last night after British Columbia’s Premier Christy Clark was forced to comment on the issue amid mounting scrutiny.

The public-insurer initially declined to release the projections, citing concerns that they would be taken out of context – but it has already submitted an application that would see rates go up 4.9%, or $42 extra a year.

The newly-released projections, which cite a surge in injury claims and insurance fraud, say rates will go up 6.4% in 2017, 7.9% in 2018, 9.4% in 2019 and 7.9% in 2020, CBC News reports.

In the best-case scenario, rates would only go up 15.8% until 2020, the insurer said.

In a letter submitted to the commission in October, ICBC warned that information on projections could be “taken out of context and used to prejudice ICBC and its basic insurance policyholders and thereby harm ICBC’s financial interest.”

But as pressure from BCUC grew, Premier Clark was forced to comment on the issue on Tuesday.

Clark avoided answering specifically whether ICBC should make the disclosures, but said that she wanted to ensure that rates aren’t raised too high in the immediate future.

“I think ICBC should keep the rates at a 4.9% increase, which is what the government is committed to doing. People cannot afford these massive rate increases,” she said.

“I am fighting for the ratepayers, people who drive cars, the moms and dads who already find life unaffordable,” Clark explained.

ICBC argue that the 4.9% increase, which still awaits approval by the BCUC, is necessary in order to cover an increase in claims and incidents of insurance fraud.

But NDP critic Adrian Dix said Clark is being disingenuous in her statement about making sure rates do not become unaffordable, according to a CBC News report.

Dix calculated that ICBC insurance rates have gone up about 30% over the last five years.

He also said that BC Liberals have transferred hundreds of millions of dollars from ICBC – money that was paid by drivers – into the province’s general revenue.

It is not clear where the money was used, the report said, but the province has committed to not taking revenues out of ICBC’s account this fiscal year.


Related stories:
Almost a third of Canadians think winter tires are a ‘cash grab’
The most expensive areas for Toronto auto insurance revealed