ICBC increases fairness of basic insurance rates

By Contributor
March 6th, 2017

ICBC is updating basic insurance to increase the accountability of drivers who cause crashes by changing how much an at-fault crash affects their basic insurance rates. This will help to alleviate the pressure on future rates paid by customers who don’t cause crashes.

Going forward, drivers who cause multiple at-fault crashes will lose their safe driving discounts faster than they do today. ICBC is applying to the BC Utilities Commission to have these changes take effect May 6, 2018.

“We believe that drivers who cause crashes should pay more than those who don’t,” said Barry Penner, ICBC Board Chair. “There were 20,000 more crashes last year than in 2015. With the escalating pressures being put on insurance rates – from more crashes, more claims and higher costs per claim – we’re making sure at-fault drivers are held more accountable for the costs they add to the system here in B.C.”

Right now, it’s possible for some drivers who have achieved the maximum discount to have caused two, or even three, crashes and have the same discount on basic insurance as a driver who has never caused a crash. Under the new system, long-term safe drivers will continue to have their discount protected if they’re at-fault for one crash but that won’t be the case if they have multiple at-fault crashes.

“This change will help us ensure our safe driving discount is applied more fairly and continue to benefit our customers who make smart and safe driving decisions,” said Mark Blucher, ICBC President and CEO. “Drivers who make good driving decisions should pay less than drivers who cause multiple crashes.” 

Starting today, drivers who cause crashes will have their discounts calculated based on the updated approach for policies renewed after May 6, 2018. This way, drivers will have plenty of warning and a chance to change their behaviour. The increased accountability changes will not apply to at-fault crashes that are on a driver’s insurance record prior to today. The vast majority of ICBC customers – those who don’t cause crashes – will not see any change.

All drivers will continue to earn credit towards discounts for every year they’re crash free. In addition, just like today, customers who cause a crash will regain their previous discount if they go three consecutive years without being responsible for a crash.

This update follows other measures ICBC and government have already taken to help alleviate the pressures on insurance rates, including:

  • Increasing penalties for distracted driving and continuing to combat this issue.

  • Focusing on stopping and deterring fraudulent and exaggerated claims.

  • Doubling basic premiums on certain high-value vehicles (personal vehicles worth more than $150,000) so the average ratepayer is not covering the cost of repairing these expensive, luxury cars.

ICBC is committed to working with the B.C. government to provide our customers with fair and affordable rates. As was announced last month, ICBC’s board of directors is commissioning a third-party review to look for options to keep future rate increases in line with the rate of inflation as much as possible. The terms of reference for this review were finalized on January 26, 2017. The review will identify key factors impacting basic insurance rates and provide a broad range of options available to limit future basic rate increases to the rate of inflation.

In the meantime, this update to basic insurance will ensure the safe driving discount is applied more fairly.

This post was syndicated from https://thenelsondaily.com
Categories: General

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