ICBC

[Urban Cowboy]

At fault claims penalties, should go against the drivers license of the guilty party, and not the vehicle.

That's how Saskatchewan does it and it's worked for eons.

If you are a terrible driver, your drivers license renewal fee will reflect that.

It may even encourage some to consider public transit.

Reading between the lines of the survey, it seems that ICBC wants to use the driving history to determine the cost of vehicle insurance. I have no idea how they would do that for, lets say someone who owns three vehicles and has numerous declared drivers for various vehicles.

Sounds like a nightmare and open to lots of fraud.

It is a nightmare, and why I agree with penalties for poor driving being attached to the offending drivers license.

You cause a crash, get ready to receive a penalty invoice against your drivers license, and if you don't pay it, say goodbye to your driving privileges.

This way who drives a vehicle is irrelevant. I'd imagine it also makes life easier for businesses with fleet insurance, as the owner shouldn't be getting penalized for a drivers short comings.

[Urban Cowboy]

Interesting reminder that ICBC has always been political: http://www.bcpolicyperspectives.com/media/attachments/view/doc/article_bc_studies_icbc_2013/pdf

Some excerpts:

"In the campaign preceding the September 1972 general election the ndp made government auto insurance a major part of its platform and promised that rates would be no higher and perhaps lower than those charged by private companies."

SNIP

"As Premier Barrett commented ten months after icbc was introduced: “You can do all kinds of things and the people won’t get upset, but raise or tinker with their auto insurance and you’ll get more complaints than you can handle. I’ve received more letters complaining about icbc than all the others put together.”

SNIP

By the fall of 1975, the Barrett government realized that a serious financial situation was developing at icbc. In November, icbc warned the government that it expected a shortfall of $181 million and that it was rapidly diminishing its operating cash (in the early years annual policies were paid on 1 March each year). Despite attempts at cost
control and a federal wage restraint scheme, rising claims and health costs were pushing icbc further into the red. Premier Barrett called a surprise election for 11 December 1975."

SNIP

"The Barrett government had not taken any action on icbc’s request to raise rates by 19 percent, assuming the proposed fuel tax subsidy. A report prepared for the new government by Byron Straight, a respected Vancouver insurance accountant, said that a 19 percent rate increase would require an annual tax subsidy of $125 million. Without the subsidy, it would be
necessary to increase rates by approximately 140 percent to meet the forecast expenditures and to eliminate the prior accumulated losses by March 1976."

SNIP

"The government rejected the proposed subsidy and announced a massive increase in auto insurance rates on 2 January 1976 for the premiums that were due at the end of February. This sparked a public outcry against the increase. Public demonstrations were organized, over 250,000 individuals signed a protest petition, "

SNIP

The government bowed to the pressure by announcing a smaller rate increase designed to balance the 1976-77 expenditure and by providing a one-time grant of $181.5* million to pay off the debt of the prior years. This was a significant amount; it was approximately 70 percent of the total government deficit in 1975-76"

*approx $866 million in 2018 $.

SNIP

"The New Democratic Party, under Mike Harcourt, won a decisive majority of the seats (but not the popular vote) in the October 1991election, and a resurgent Liberal Party became the official opposition. Icbc management immediately presented Moe Sihota, the labour and consumer minister with responsibility for icbc, with a forecast of a $180million loss, primarily due to increasing claims and claim costs as well as lower income due to lower interest rates. Icbc management sought a 24 percent average rate increase for 1992, but the cabinet only granted 19 percent. The ndp accused the previous government of ignoring icbc’s forecast and setting artificially small rate increases for 1990 and 1991 in the hope of improving its election chances. Finance Minister Glen Clark denounced such political interference: "

SNIP

" In the early 1990s, icbc became more active in promoting and funding traffic safety initiatives in order to reduce claims and to support the government’s social agenda. A significant change occurred in 1996, when the government transferred all driver licensing services from the Motor Vehicle Branch to icbc. This transfer of over 460 employees and
$40 million would allow the greater integration of services,"

SNIP

Another increase in icbc’s expenditures occurred in 1994, when the government mandated that the corporation, rather than the Medical Services Plan (msp), would be the prime insurer for medical claims. This change resulted in savings to the msp of approximately $13 million in the 1994-95 fiscal year as this cost was transferred to drivers through their insurance premiums. Icbc president Thom Thompson confirmed these changes in mandate when the 1995 Annual Report stated that icbc was becoming a loss prevention company rather than just an insurance company.


Glen Clark became premier in February 1996, following the resignation of Mike Harcourt. The next month he announced a freeze on all taxes and fees, including automobile insurance rates, as a major plank (Freeze for Families) in the government’s re-election platform.

However, the rate freeze, retroactive to 1 January 1996, contributed to a loss of some $134.9* million at icbc in that year, reducing total reserves to approximately $210 million. Nevertheless, the government continued to consolidate driver and vehicle-related programs with icbc. In 1997, it transferred the commercial transport and compliance operations of the Motor Vehicle Branch to icbc, using a funding arrangement similar to that of driver licensing whereby icbc remitted the licence fees less their operating costs."

*approx $202 million in 2018 $

SNIP

"The Liberal government was much more ideologically driven than its Social Credit predecessor. As promised during the election, the government immediately cancelled the unpopular icbc-funded photo-radar program, and it imposed a severe financial restraint program in keeping with the government-wide spending-reduction program."

SNIP

"The government decided to keep icbc as a public corporation and thereby avoided a likely political storm. Icbc had earned the support of the insurance agents, the trial lawyers, health providers, and other influential groups, and the government did
not want to alienate them. It announced that icbc would continue to provide mandatory basic insurance as well as road safety and education programs. Nevertheless, the government announced some changes. It would encourage greater competition in optional insurance in order to increase choice and to reduce premiums, transfer decisions respecting basic insurance structure and rates to the British Columbia Utilities Commission (bcuc), and reclaim most of the commercial transport inspection and compliance program due to a potential conflict in roles for icbc. What was not announced was that, for the next three years, icbc would continue to pay approximately $27 million per year for the commercial vehicle program."

SNIP

"Finance Minister Gary Collins denounced the ndp’s rate freeze and the rebate to BC drivers: “The manipulation of their rate
got so obscene that just prior to the last election, the ndp government not only dealt with the rates, but they actually sent people cheques.”

SNIP

"By January 2008, icbc was a highly profitable organization with $9.6 billion invested. Net income for the previous year was approximately $500 million, and the total capital reserve had reached a new record of $2.4 billion. The corporate
mct had risen to 188 percent, but icbc management continued to target 150 percent for 2008. Comparing the capital reserves to premiums written (polices sold), there was enough basic capital to operate for seven months. The equivalent number for optional insurance was almost eleven months.
Towards the end of the decade various cabinet orders had greatly circumscribed the regulatory control of the utilities commission over the basic insurance business and over icbc in general."

SNIP

"The most fundamental change in the relationship between government, icbc, and its customers occurred with the
2010 provincial budget. On 4 March 2010, Finance Minister Colin Hansen confirmed that, as the sole shareholder, the province, over three years, would take $778 million of icbc’s “excess” capital from the optional capital
reserve as a dividend in order to reduce provincial borrowing costs. "


What we see is politicians never seem to be able to leave something that ain't broke alone. The only exception, oddly enough, being wild Willy Van Der Zalm. During the periods under Van Der Zalm, and under Campbell, when the running of ICBC was left to professionals, and particularly during the period when the BCUC was the real oversight body, ICBC did well, and rate problems were not much of an issue. But like an artist that never knows when a painting is finished, the politicians somehow knew better.

In reality, ICBC has been political from the get go, and the current BC NDP are continuing with that tradition.

The NDP, the Liberals, the Socreds have all decried political interference, but every single one of their governments mucked around with ICBC - except as noted Van Der Zalm.

It is notable that while the BC NDP went after the Liberals for taking dividends from ICBC, they had, in the 1990s, used ICBC as a cost dumping ground to improve their budget numbers - which is essentially the same game the Liberals played with dividends (a practice the BC NDP initiated with dividends from BC Hydro).

And so we wind up right back in the mess that Bill Bennett fixed with a $866 million (2018 $) cash infusion to ICBC in 1976.

So after carefully reading all that over, I've come to the conclusion that the NDP, specifically Eby, have certainly got some stones, calling ICBC's current situation a "dumpster fire", when the NDP are the ones who lit the match many times over.

Then again as we've been shown many times over, hypocrisy is the most notable trait of the NDP and their hapless supporters.

[Jflem1983]

BC conservatives need to run on an eliminate ICBC platform. They will win big

[hobbyguy]

Techie - actually ALL stripes of government, except perhaps the Zalm crew, have been hypocritical about ICBC.

It was started as a political animal by the BC NDP. The Socreds took a different political tack, at first trying to destroy it - but then bailing it out. The NDP then used it as political football, AND as a cost dumping ground to make their budgets look better. The Liberals got ICBC on a better track by removing some of the cost dumping, and even better when they decided, for a short period, to leave it to be run by professionals with oversight from the BCUC. But that didn't last because the professionals made ICBC very profitable, and without blowing rates through the roof. As with the NDP and their cost dumping, the Liberals couldn't keep their hands off the pot of gold that ICBC had accumulated - and politics once again trumped sound management.

That, of course, has allowed the current BC NDP to use ICBC as a political football - which of course they have been doing for the past few years as they put pressure on to limit increases in rates to reflect the rise of distracted driving accidents etc. The BC NDP are still playing political football with ICBC, as they had ICBC overestimate current year losses (where the Liberals had them underestimated) so that they could both create the "dumpster fire" imagery, and then have whatever moves they make appear to be more effective than they are.

The real problem with ICBC is that the BC NDP changed it from being an insurance company to being a hybrid between that and a government agency. Private insurance companies don't do a lot of the stuff that ICBC does - like issuing driver's licenses, chasing unpaid traffic fines etc.

The best thing for ALL politicians and the ICBC ratepayers is for the politicians to quit mucking about altogether. ICBC actually functioned very well when it was left to the pros, and the oversight left to the BCUC. But I doubt that we will see that.

[my5cents]

Effective May 6th 2018 the BC Liberals had set it up so that if you had a claim you fall down 9 discount levels, currently it is 3.
NDP Government canceled that change today.

that's right, BC Liberals had it in place to hit bad drivers harder. NDP said NOPE.

NDP JUST CANCELED That same improvement they are talking about adding.

Insanity how political this is.

I haven't read or heard anything about the claims rated scale changes you are talking about. So at this point can't say much,,,, however

The Claims Rated Scale isn't so simple as "if you had a claim you fall down 9 discount levels, currently it is 3"

The number of steps one moves up in surcharge is based on where they already are on the scale.

For example I have an older CRS sheet that shows :
15 - 20 years claims free they go up 3 steps
9 - 14 years, a chargeable claim jumps them 4 steps
4 - 8 years, a chargeable claim jumps them 5 steps
3 and less, 6 steps

[rustled]

I haven't read or heard anything about the claims rated scale changes you are talking about. So at this point can't say much,,,, however

The Claims Rated Scale isn't so simple as "if you had a claim you fall down 9 discount levels, currently it is 3"

The number of steps one moves up in surcharge is based on where they already are on the scale.

For example I have an older CRS sheet that shows :
15 - 20 years claims free they go up 3 steps
9 - 14 years, a chargeable claim jumps them 4 steps
4 - 8 years, a chargeable claim jumps them 5 steps
3 and less, 6 steps

Have you had a chance to look at the website and survey, my5cents?

[lesliepaul]

This group of B.C. NDP idiots honestly believe that they are going to cure ICBC with these proposals. What they are planning is to make ICBC so convoluted that none of us will be able to understand what is happening. They want to extort as much money as possible out of more people and then tell us they have turned ICBC around.

In following this ICBC story for years now and watching the Liberals remove well over a BILLION dollars from it.......I have the belief that we the tax payers are not getting the whole truth on what ICBC TRULY has made over the last decade. Yes, we all read about the losses and the reaction to these reported losses...........there is more to this than these lying politicians want us to know. Right now they only want us to see what they decide to show us. Make it appear so bad so they can extort more money in the name of "righting the ship".

[Merry]

The real problem with ICBC is that the BC NDP changed it from being an insurance company to being a hybrid between that and a government agency. Private insurance companies don't do a lot of the stuff that ICBC does - like issuing driver's licenses, chasing unpaid traffic fines etc.

I agree - they need to allow it to function as all other insurance companies do.

[my5cents]

The real problem with ICBC is that the BC NDP changed it from being an insurance company to being a hybrid between that and a government agency. Private insurance companies don't do a lot of the stuff that ICBC does - like issuing driver's licenses, chasing unpaid traffic fines etc.

I agree - they need to allow it to function as all other insurance companies do.

I think you should consider the pros and the cons of what ICBC controls before you make sweeping statements.

You're not alone, many have said : ICBC shouldn't run traffic safety programs, ICBC shouldn't issue driver's licenses, ICBC shouldn't register vehicles, ICBC shouldn't collect fines,

Fines,,,, are you aware that in BC, because ICBC issues Driver's Licenses, Registers Vehicles and Insures Vehicles, that the percentage of unpaid fines is lower than any private insurance jurisdiction ? Are we opposed to collecting fines and bad debts ? How often do we hear that XYZ City has $XX million in unpaid parking tickets ? I don't know about you, but I'd like to see fines and bad debts collected. As an insurance company ICBC does incur bad debts of it's own (non ticket fines) unpaid premiums, collections on breached claims, etc. So do we set up a collection department for unpaid tickets and retain ICBC's collections department to just collect direct ICBC related debt ?

What would it cost to establish a provincial collection agency for collecting these fines ? How many million ?

Licensing of drivers is closely related to the driving of vehicles, for which ICBC insures. What would be the benefit of the government re-establishing a Motor Vehicle Branch Driver's License Department ? What is the down side ? What would the cost be ? How many million ?

Does anyone think that the registration of vehicles should be separated from ICBC ? If so, what would the benefit be ? The downside ? Again how much would it cost to re-establish that department.

At this time ICBC has an enormous printing and mailing facility that amalgamates all these tasks, do we think we should splinter these off and duplicate these operations ?

What about ICBC's computer system, do we pay for the creation of, new systems to handle each function that has been stripped from ICBC ? At what cost.

The one add on that most disagree with is the Traffic Safety Department. At first blush it seems pretty useless, however if you read any independent study on ICBC you'll find that it actually saves ICBC millions of dollars a year in reducing claims.

So, everyone is ranting and raving about reducing claims, but only on certain terms ? So we establish a Road Safety Department of the Provincial Government, and they do what, go to ICBC to get stats to find out what types of actions are causing collisions ? Because in case you don't know it, the police have "opted" out of investigating all but the very serious collisions. The only stats available are from ICBC.

There are other add ons that most never hear about, like the financial support that ICBC gives to the Auto Theft Task Force. ICBC was instrumental in establishing the Bait Vehicle program. Ironically the RCMP fought the idea, "it will never work" when they finally capitulated (such programs were working all over North America) all of a sudden to hear the RCMP, it was their great idea.

[Merry]

If you think of ICBC as just another Government Department, then I agree that it is much more efficient to continue combining auto insurance and all those other things you mention. BUT we don't expect Government Departments that provide a service to make a profit the way we expect an insurance company to. So it isn't fair to expect ICBC to operate as a Government Department which offers all those services you list, and still have a balance sheet as good as we'd expect to see if it was just a privately operated insurance company that didn't do all that other stuff as well.

We can't have it both ways. Do we want an efficiently run INSURANCE company, or do we want a Government Department that also offers insurance?

There are pro and cons for each, but we have to choose which delivery model suits us best. IF ICBC is seperate from Government, and IF they continue to provide Government Services, then they should be allowed to bill the Government for the cost of those services (which should still be a bargain if ICBC can deliver them more cheaply than if the Government delivered those services themselves).

If the Government was made to pay ICBC for doing the work Governments in other Provinces do themselves, maybe ICBC wouldn't have such a huge deficit, and our premiums would be lower.

[my5cents]

If you think of ICBC as just another Government Department, then I agree that it is much more efficient to continue combining auto insurance and all those other things you mention. BUT we don't expect Government Departments that provide a service to make a profit the way we expect an insurance company to. So it isn't fair to expect ICBC to operate as a Government Department which offers all those services you list, and still have a balance sheet as good as we'd expect to see if it was just a privately operated insurance company that didn't do all that other stuff as well.

We can't have it both ways. Do we want an efficiently run INSURANCE company, or do we want a Government Department that also offers insurance?

There are pro and cons for each, but we have to choose which delivery model suits us best. IF ICBC is seperate from Government, and IF they continue to provide Government Services, then they should be allowed to bill the Government for the cost of those services (which should still be a bargain if ICBC can deliver them more cheaply than if the Government delivered those services themselves).

If the Government was made to pay ICBC for doing the work Governments in other Provinces do themselves, maybe ICBC wouldn't have such a huge deficit, and our premiums would be lower.

I never said any of those departments, Driver's Licensing, Veh Registration, Collections, or Traffic Safety made a profit. We also DON'T expect government run auto insurance to operate at a profit, but it shouldn't run at a deficit either.

The huge loss picture is because of claims pay outs, not because of these services.

If the government took over these duties, after the cost of setting them up, the staff etc, who do you think would be paying the extra ? You and I.

The hard part to get ones head around is the fact that IF ICBC charges "the government" for collections, for traffic safety, driver's licensing etc. Who is the government ? You and I.

Since all these functions are auto related, it seems to me they should be paid for by something that is auto related. If as you say "the government" is billed for these services, that money is going to come out of general revenue. At least the way it is, it is being paid for by the motoring public.

I don't think that ICBC, by operating these functions becomes inefficient, in fact having all these functions "under one roof" contributes to their efficiency, thus their success with collections (for example).

The fact that ICBC provides these services to the government is a bonus in helping with revenue. I did chuckle when a number of years ago the cost of obtaining a DL and the cost of renewing a DL went up and the general public accepted it without as much as a whimper. I'm sure the unsaid feeling was "yes, well the cost of these services goes up over the years and I guess it was time to raise the rates" The day before the rates went up, a DL renewal cost the government $00.00, every cent was clear revenue. The day after the rate went up the cost to the government for that service was still $00.00.

BC with the lowest personal provincial taxes in Canada.

[GordonH]

http://www.cbc.ca/beta/news/canada/brit ... -1.4567616

Would like to see these upgrade done here as well.

[the truth]

icbc is a mess ,but this is part of there problem i would think https://www.castanet.net/edition/news-s ... htm#220821

[my5cents]

icbc is a mess ,but this is part of there problem i would think https://www.castanet.net/edition/news-s ... htm#220821

That was a very interesting and an eye opening program.

It impressed me that a private insurance company, Aviva conducted the investigation.

Aviva damaged 10 vehicles intentionally, all to look like they had been involved in a minor collisions. Each was stopped at the side of the road, with someone who appeared to have just been in an accident. They waited for whatever tow truck showed up. There was no direction as to which body shop the vehicle went to.

Each vehicle, having been damage was first examined by professional to document exactly what damage the vehicle had, also each vehicle was equipped with video surveillance.

Each vehicle was "insured" by Aviva, so no other insurance company was placed at risk. 9 or the 10 vehicle's damage and repairs were, inflated, either by fixing things that the body shop damaged themselves, claimed they replaced parts they didn't, etc etc. On average each of the 9 vehicles was inflated by $3300.

ICBC in it's "wisdom" several years ago, reduced it's estimating staff, allowing vehicles to be taken directly to body shops, where the body shops would estimate the damage, which was subject to verification by the remaining ICBC estimating staff, generally by examining photo's submitted by the shops.

[Urban Cowboy]

ICBC in it's "wisdom" several years ago, reduced it's estimating staff, allowing vehicles to be taken directly to body shops, where the body shops would estimate the damage, which was subject to verification by the remaining ICBC estimating staff, generally by examining photo's submitted by the shops.

Though I suppose it would make some difference, I'm not sure how much.

The one and only time I had to deal with ICBC was before they reduced the estimating staff, and I went with a nearby repair facility that was approved by ICBC.

Long story short they not only installed used parts, they installed used parts that were broken. One would think that examining the part before installing it is part of the process but apparently not.

The vehicle in question was older but had undergone a complete restoration, with all receipts documenting the process.

This was something the ICBC estimator wasn't too happy about, as he thought he could just write it off for $500 and be done with it. He was about to say as much, when I handed him my folder, and it was obvious the receipts were all a year old or less.

In my opinion, there are a number of areas, that could use a serious crack down on procedures.