Change of course needed for ICBC

Change of course needed for ICBC

It’s time the provincial government looked at ending the monopoly on automobile insurance

While the hand steering the course may be new, all indications suggest the destination will likely be the same. A report released this week suggests B.C.’s auto insurance rates could increase by as much as 30 per cent in the next two years.

The province’s new Attorney General David Eby was quick to downplay the report by Ernst &Young, saying “a 30 per cent rate increase will not be happening on our watch.” While the NDP government can certainly limit the amount of ICBC rate increases, there’s no escaping the underlying fact that there the province’s government-run auto insurance program is in serious need of an overhaul.

The report was commissioned by the previous Liberal government, which had long neglected the major work needed by the Crown corporation.

“ICBC has been careening toward a crisis over at least the last couple of years,” said Eby, who accused the previous government of using ICBC as a “bank machine” to help top up general revenue.

Eby’s first call to action is something the previous Liberal government long avoided: hiking the rates of drivers causing crashes. “Making them pay more because they are costing the system more just makes sense to us,” he said.

But ending the subsidy to B.C.’s worst drivers won’t be enough to reverse the problems caused through years of neglect by the previous government. The province has brought about minor adjustments to ICBC, most recently when the previous government announced cars worth more than $150,000 would no longer be covered.

But that will do little to turn the corporation’s fortunes around. The Ernst &Young report says accident rates increased by 23 per cent between 2013 and 2016, and that vehicle repair costs have skyrocketed to a total of $1.5 billion in 2016. That’s more than a bit of tinkering can repair.

After enjoying a monopoly over the province’s auto insurance market for more than four decades, perhaps the time has come to let B.C. drivers shop around. It’s an idea the new NDP government should at least take out for a test drive.