A crash last month at Highway 10 and Scott Road in Delta. Injury crashes and the resulting claims are driving basic rates up at ICBC.

A crash last month at Highway 10 and Scott Road in Delta. Injury crashes and the resulting claims are driving basic rates up at ICBC.

Average driver will pay ICBC $60 more in basic, optional insurance

ICBC settles on 5.5 per cent basic rate hike, province approves transfer of $450 million from optional side

The Insurance Corp. of B.C. has decided to raise basic auto insurance premiums by 5.5 per cent, driving up the annual cost by more than $44 for the average driver.

And a further jump in optional premiums for coverage like third-party liability will add nearly $16, for an annual increase of about $60 on average.

The basic premium increase is less than the 6.7 per cent jump ICBC had warned in August might be required as a result of rapidly rising injury claims and the resulting payouts.

The hit is lower in part because the province has approved an unusual $450-million transfer of capital from ICBC’s optional insurance business to the basic insurance side.

There’s been growing financial pressure on the basic side, while ICBC has had more wriggle room in recent years to actually decrease rates on its optional side, where it does not hold a monopoly and competes with private insurers.

But officials say optional costs are now also on the rise because optional third-party liability insurance covers injury payouts over $200,000.

Adrian Dix, the NDP’s critic on ICBC, noted the average driver will be paying nearly 30 per cent more in basic premiums than they did when Christy Clark became premier in 2011.

“Overall what we’re talking about is a major, major increase in rates for the average motorist,” said Dix, who lays part of the blame on management decisions at ICBC and trouble with the rollout of its new computer system.

He noted the provincial government has not opted to forgo the $160-million annual dividend it extracts each year from ICBC’s optional side.

“They’re not sacrificing,” Dix said. “They’re doing a double dip on the optional side.”

Canadian Taxpayers Federation spokesman Jordan Bateman said the continued flow of dividends to the government is particularly frustrating.

“Despite the fact we get gouged for more money each year, the government continues to suck all the profits out and puts them into general revenue,” Bateman said.

“We have a government that talks about affordability but erodes it when it comes to ICBC rates that continually jump higher than the rate of inflation.”

Transportation Minister Todd Stone said more than 80 per cent of motorists use ICBC for both basic and optional coverage and they are paying only 13 per cent more than in 2011 after recent optional rate cuts are taken into account.

Forgoing the annual dividend to government would have only trimmed the basic rate hike to 5.2 per cent, Stone said.

That 0.3 per cent reduction would have been “negligible” in terms of impact on customers, he said, but would “blow a pretty significant hole” in the province’s budget.

He called the $450-million transfer a one-time shift that can’t be repeated next year because there won’t be enough excess capital on the optional side.

ICBC officials also said they’re stepping up efforts to combat exaggerated and fraudulent claims.

A new fraud analytics tool is to be deployed early next year to use data, algorithms and statistical methods to quickly flag patterns and high predictors of fraud early in the claims process.

ICBC projects bodily injury claims costs will hit $2.3 billion this year, up from $2.17 billion in 2014. Those costs are up 64 per cent since 2008. The number of injury claims are up about 11 per cent from the previous year.

Another basic rate hike is guaranteed next year.

The province’s rate smoothing policy requires each new year’s rates be no more than 1.5 per cent above or below the previous year’s. That means ICBC will be considering an increase of between four and seven per cent next fall.

The proposed basic rate hike, effective Nov. 1, must still be approved by the B.C. Utilities Commission.

ICBC RATE CHANGES and GOV’T DIVIDENDS | Create your own infographics

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Saanich police officers were one group of dozens that submitted dance clips to the Greater Victoria Festival Society, to help create the Dance Across Victoria video montage. (Youtube/Screenshot)
WATCH: Saanich police, Victoria mayor bust some moves in new Dance Across Victoria video

Montage features submitted dance clips from across Greater Victoria

Former Oak Bay High Grade 12 student Brandon Kip plays the $100,000 Steinway piano in the Dave Dunnet Theatre. (Black Press Media file photo)
Oak Bay High Alumni Association passes torch to new president

The association has given back more than $70,000 in its 16 years

Saanich’s Malia Brodie competed in the Vancouver qualifiers for the 2020 National Championships. (Photo by BC Sport Karate Snaps)
PHOTOS: Saanich teen awarded $1,800 Karate Canada bursary to pursue officiant certification

Malia Brodie, 18, has black belt, nearly 15 years experience in karate

This photo courtesy of Leanne Grover shows the immediate aftermath of the fire at 7987 Galbraith Cres. that caused extensive damage and displaced six residents. (Leanne Grover/Submitted)
Residents of a Central Saanich duplex ‘fortunate’ to escape Sunday morning fire

Damage to the duplex extensive with one resident said to be ‘catatonic’ after escaping building

After more than a year, open forums will resume at a Saanich committee of the whole meeting on April 19 with up to five residents having the chance to speak for three minutes each about any district-related matter. (Black Press Media file photo)
Public input resumes at Saanich council following lengthy suspension due to pandemic

Up to five residents can present by phone for up to three minutes starting April 19

Vancouver resident Beryl Pye was witness to a “concerning,” spontaneous dance party that spread throughout social groups at Kitsilano Beach on April 16. (Screen grab/Beryl Pye)
VIDEO: Dance party erupts at Vancouver’s Kitsilano Beach to the dismay of onlookers

‘It was a complete disregard for current COVID-19 public health orders,’ says Vancouver resident Beryl Pye

Deputy Prime Minister and Minister of Finance Chrystia Freeland responds to a question during Question Period in the House of Commons Tuesday December 8, 2020 in Ottawa. The stage is set for arguably the most important federal budget in recent memory, as the Liberal government prepares to unveil its plan for Canada’s post-pandemic recovery even as a third wave of COVID-19 rages across the country. THE CANADIAN PRESS/Adrian Wyld
Election reticence expected to temper political battle over federal budget

Opposition parties have laid out their own demands in the weeks leading up to the budget

A syringe is loaded with COVID-19 vaccine at a vaccination clinic run by Vancouver Coastal Health, in Richmond, B.C., Saturday, April 10, 2021. THE CANADIAN PRESS/Jonathan Hayward
B.C. to open up COVID vaccine registration to all B.C. residents 18+ in April

Registration does not equate to being able to book an appointment

Pat Kauwell, a semi-retired construction manager, lives in his fifth-wheel trailer on Maxey Road because that’s what he can afford on his pension, but a Regional District of Nanaimo bylaw prohibits using RVs as permanent dwellings, leaving Kauwell and others like him with few affordable housing options. (Chris Bush/News Bulletin)
Rules against RV living hard on Island residents caught in housing crunch

Regional District of Nanaimo bylaw forcing pensioner to move RV he calls home off private farm land

(Black Press file photo).
UPDATED: Multiple stabbings at Vancouver Island bush party

Three youths hospitalized after an assault in Comox

Selina Robinson is shown in Coquitlam, B.C., on Friday November 17, 2017. British Columbia’s finance minister says her professional training as a family therapist helped her develop the New Democrat government’s first budget during the COVID-19 pandemic, which she will table Tuesday. THE CANADIAN PRESS/Darryl Dyck
B.C. finance minister to table historic pandemic-challenged deficit budget

Budget aims to take care of people during pandemic while preparing for post-COVID-19 recovery, Robinson said

Each spring, the Okanagan Fest-of-Ale is held in Penticton. This year, as a result of the COVID-19 pandemic, the festival will not be held. However, beer is still available. How much do you know about this beverage? (pxfuel.com)
QUIZ: How much do you really know about beer?

Put your knowledge to the test with this short quiz

Lord Tweedsmuir’s Tremmel States-Jones jumps a player and the goal line to score a touchdown against the Kelowna Owls in 2019. The face of high school football, along with a majority of other high school sports, could significantly change if a new governance proposal is passed at the B.C. School Sports AGM May 1. (Malin Jordan)
Power struggle: New governance model proposed for B.C. high school sports

Most commissions are against the new model, but B.C. School Sports (BCSS) and its board is in favour

Russ Ball (left) and some of the team show off the specimen after they were able to remove it Friday. Photo supplied
Courtenay fossil hunter finds ancient turtle on local river

The specimen will now make its home at the Royal BC Museum

Most Read