Insurance Bureau of Canada : ICBC Needs Competition

Re: Insurance Bureau of Canada : ICBC Needs Competition

Postby Drip_Torch » Aug 16th, 2019, 9:19 pm

Okay, but I would suggest what you don't understand is insurance brokers in Alberta may not be the example you want to point to. The auto insurance brokers in Alberta are on the ropes and as I stated in the above post, two companies have pulled out of Alberta altogether.

It's all well and good to point to Alberta and say the insurance rates are better because of competition, but the fact is the competition, the gov't regulation attempting to keep rates down and increased claim costs, are forcing companies out of the market and limiting options for drivers.

Don't take my word for it... here's an article by an Alberta insurance broker that explains why more drivers are being refused coverage. https://www.armourinsurance.ca/blog/alb ... -in-crisis

It's all well and good that the broker can phone around and get different quotes from underwriters, but if all the quotes come back as "no thank you", we don't want that customer - well that kind of sucks for that customer doesn't it? Can't really improve your driving record and insurability if you can't get insurance to drive.

You want to throw away ICBC and go with a private insurance system like Alberta? Really? While the average Albertan is looking at between 11% and 16% rate increase and some won't be able to get insurance at all - I'm looking at saving between $90 and $320 the next time I renew mine under the new insurance plan.

ETA: Huh, the more I look at the Alberta auto insurance industry the more apparent it becomes something has to give with the expiry of the rate cap on Aug 31. I bet it won't be the insurance brokers, underwriters or reinsurance companies.

Looking at Alberta, claims costs are increasing by more than 10% a year, with loss ratios hovering in the 130% area. This is translating into premium increases, availability issues, less choice and no innovation as the product has not been reviewed in some time. Insurers are concerned that the 5% cap on rate increases implemented by the previous government has remained in place and that the true drivers of higher costs have yet to be addressed. The industry is calling for the government of Alberta to work closely with the industry to address the underlying cost drivers and remove the cap.


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Re: Insurance Bureau of Canada : ICBC Needs Competition

Postby 1791 » Aug 16th, 2019, 9:37 pm

Funny SGI does good in Medicine Hat ..
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Re: Insurance Bureau of Canada : ICBC Needs Competition

Postby casey60 » Aug 17th, 2019, 10:34 am

My vote will go to the party that will bring back competition in the vehicle insurance industry.

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Re: Insurance Bureau of Canada : ICBC Needs Competition

Postby my5cents » Aug 17th, 2019, 12:05 pm

casey60 wrote:My vote will go to the party that will bring back competition in the vehicle insurance industry.


Alberta is big into competition, and you'll only need one plate !

Seriously..... My guess is you never experienced private insurance in BC ? It has been 45 years.

There truly was many good reasons why the government of the day opted for government insurance.

As time passed, the ideals of government insurance were forgotten or ignored by another government. That government at one point explored privatizing auto insurance but around that time, realized they could use insurance profits as a supplement to their revenues.

Ironically when the Liberal took over as government, in 2001 they placed a very reputable well thought of businessman, Nick Geer as CEO of ICBC, thinking he would analyse the working of the government insurance in BC and help dismantle same. As it turned out Nick found he liked the workings of ICBC, did some tweaking turning a $250 million loss in 2001 into a $389 million profit in 2004. Geer had been the managing director of the Jim Pattison Group of Companies from 1980 to 1999.

Ironically Nick Geer was killed in a traffic collision in California recently.

On top of taking those (they called) "dividends", they were pressured to ignore the trend in the rest of Canada to protect the auto insurance industry by adopting a form of No Fault Tort. I suspect by the Trial Lawyer's Assn. (you know, those ads every evening on the TV "Tell Dell", "Before you go to ICBC call ….").

The proof that the provincial Liberals blatantly ignored a recommendation that BC should join the balance of Canada implementing a form of no fault tort is clearly obvious in that the portion of the 2014 Ernst & Young report containing the recommendation was removed from the report and the Liberal allowed the payouts to merrily flow from ICBC.

Those two acts, or rather that one act and that one lack of action has caused the present problem. NOT lack of competition.

"Competition" and "choice" are the buzz words used by the agencies promoting privatizing of auto insurance in BC.

In actual fact all but the minimum basic third party liability coverage, that is required by law for every vehicle in BC is subject to the monopoly. All the rest, Comprehensive, Collision, Additional Liability coverage, Roadside assistance, Loss of Use, etc etc is fully open to competition.

Historically that portion of auto insurance (Third Party Liability) is the least profitable. https://www.canadianunderwriter.ca/insu ... 004164561/

As the linked article reports 53% of every auto insurance dollar collected goes towards third party liability but the insurance companies are paying 59% of every insurance dollar collected to pay third party liability claims. The Alberta auto insurance companies are supplementing there losses in that area with the profits from the sale of their optional coverage.

In BC, ICBC is prohibited from offsetting losses from the mandatory third partly liability with profits from the optional coverage.

The private auto insurance companies in BC are selling just the profitable side of the auto insurance business and in that area, ICBC is competitive, even when considering the private companies "cherry pick", ie refusing to sell to higher risk drivers in favor of the low (profitable) customers.

Now is NOT the time to make a decision on privatizing auto insurance in BC, or opening it up to full competition. We need to wait and see what happens now that we will have a level playing field with the rest of Canada.

If privatized, the efficiencies and tasks that form a part of the entire government insurance structure will be lost and those unnoticed benefits would then be paid for as an additional cost to the auto insurance buying public.

As the saying goes, "be careful what you wish for, it might just come true". Once gone it won't be back.

I recall speaking with young men many years ago. Spouting off "we need to get ride of ICBC",,, completely unaware that they were saving hundred and hundred of dollars and getting good insurance coverage instead of what they would have faced in a private insurance regime. They were uninformed and going along with the rest of the uninformed herd.
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Re: Insurance Bureau of Canada : ICBC Needs Competition

Postby twobits » Aug 17th, 2019, 3:08 pm

my5cents wrote:I recall speaking with young men many years ago. Spouting off "we need to get ride of ICBC",,, completely unaware that they were saving hundred and hundred of dollars and getting good insurance coverage instead of what they would have faced in a private insurance regime. They were uninformed and going along with the rest of the uninformed herd.


And perhaps those young men you spoke to were actually the uninformed. They did not realize that their driver experience and history should command a higher premium. They are being subsidized by me and you and a few hundred thousand other drivers that should not be paying what we do.
These new changes are positive IMO but still fall 50 yards short of a competitive insurance market. If ICBC thinks these new changes are the solution to fair insurance rates for all........they should then not fear competition.
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Re: Insurance Bureau of Canada : ICBC Needs Competition

Postby my5cents » Aug 17th, 2019, 4:02 pm

twobits wrote:And perhaps those young men you spoke to were actually the uninformed. They did not realize that their driver experience and history should command a higher premium. They are being subsidized by me and you and a few hundred thousand other drivers that should not be paying what we do.
These new changes are positive IMO but still fall 50 yards short of a competitive insurance market. If ICBC thinks these new changes are the solution to fair insurance rates for all........they should then not fear competition.

The question has always been, how much do you or should you expect the inexperienced to pay. With private insurance there is no guarantee that an inexperience insured will continue to purchase coverage from your company. So charging a fair premium gauged to their experience (or lack thereof) for a few years, doesn't guarantee a continued premium source from that individual as their experience and maturity makes them less of a risk. If they screw up and cost your company a claim, there is no guarantee that your company will have the opportunity to recoup the loss over years of continuing higher premiums, so charge them an arm and a leg for coverage, which can be achieved as long as the rest of the "competition" does the same.

The private game is simple, attract as many low risk insureds as possible. Dump high risk insureds or dissuade them with exorbitant premiums, very limited coverage and demands for full up front yearly premiums.

The government system can rely on continued premiums from all, so a fair premium based on driving experience and claims history can be achieved. If the experience indicates high risk driving or the claims history is demonstrating poor driving, premiums can be raised, you will always have the customer.
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Re: Insurance Bureau of Canada : ICBC Needs Competition

Postby GordonH » Aug 17th, 2019, 4:28 pm

I have accident free driving record and no tickets since my teen years.
I'm not expecting icbc to pay me to insure with them, I do expect to pay the same as lowest rates across this country for coverage I have.

I do expect bad drivers to learn from there stupidity by paying huge premiums. The better they drive the lower their premium goes.
That's called rewarding good driving habits, what a awesome concept.
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Re: Insurance Bureau of Canada : ICBC Needs Competition

Postby OKkayak » Aug 17th, 2019, 4:48 pm

my5cents wrote:Seriously..... My guess is you never experienced private insurance in BC ? It has been 45 years..

Exactly, it’s been 45 years, that’s nearly half a century. Time to let go off the past.
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Re: Insurance Bureau of Canada : ICBC Needs Competition

Postby my5cents » Aug 17th, 2019, 5:26 pm

GordonH wrote:I have accident free driving record and no tickets since my teen years.
I'm not expecting icbc to pay me to insure with them, I do expect to pay the same as lowest rates across this country for coverage I have.

I do expect bad drivers to learn from there stupidity by paying huge premiums. The better they drive the lower their premium goes.
That's called rewarding good driving habits, what a awesome concept.

I agree with you with certain caveats. Auto insurance is complicated, comparing coverage across the country can be a challenge. Are the coverage limits the same in the provinces being compared. Does the comprehensive coverage in the jurisdictions compared, also include glass.

Even comparing coverage between certain areas of BC to other area of BC is different.

The driver you left out is the inexperience driver. Yes they should pay more than an established driver with a good record, but how much more.

ICBC's answer is a formula where a new driver, no matter what gender, marital status or age, starts at a base rate. As that driver gains experience without claims they pay less and less. Any driver who is responsible for a claim pays more on a sliding scale. In addition to the claims history risky driving behavior is gauged if violations or charges are accumulated. Those infractions are assessed in another scale and can also become very expensive.
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Re: Insurance Bureau of Canada : ICBC Needs Competition

Postby 1791 » Aug 17th, 2019, 5:41 pm

my5cents wrote:
GordonH wrote:I have accident free driving record and no tickets since my teen years.
I'm not expecting icbc to pay me to insure with them, I do expect to pay the same as lowest rates across this country for coverage I have.

I do expect bad drivers to learn from there stupidity by paying huge premiums. The better they drive the lower their premium goes.
That's called rewarding good driving habits, what a awesome concept.

I agree with you with certain caveats. Auto insurance is complicated, comparing coverage across the country can be a challenge. Are the coverage limits the same in the provinces being compared. Does the comprehensive coverage in the jurisdictions compared, also include glass.

Even comparing coverage between certain areas of BC to other area of BC is different.

The driver you left out is the inexperience driver. Yes they should pay more than an established driver with a good record, but how much more.

ICBC's answer is a formula where a new driver, no matter what gender, marital status or age, starts at a base rate. As that driver gains experience without claims they pay less and less. Any driver who is responsible for a claim pays more on a sliding scale. In addition to the claims history risky driving behavior is gauged if violations or charges are accumulated. Those infractions are assessed in another scale and can also become very expensive.



Take away insurance all together. Watch people slow down
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Re: Insurance Bureau of Canada : ICBC Needs Competition

Postby jimmy4321 » Aug 18th, 2019, 5:15 am

I've experienced private insurance in the last 1-8 yrs in 4 cities and 3 provinces and ALL worked to my advantage in a big way on a work vehicle & personal - Also had private insurance at 16yrs old.
I have relatives in those provinces that laugh their asses off at how ridiculous BC has become. My record is spotless except for a deer accident close to 20 yrs ago but no tickets etc.
. I pay near $1800(maybe bit more) with full discount where elsewhere with same coverage cost me $955. I showed my year old policy from Ontario to the ICBC rep cause I wanted the same coverage and to be a dick I guess since they were bragging about these new changes.

:cuss: ICBC
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Re: Insurance Bureau of Canada : ICBC Needs Competition

Postby Hurtlander » Aug 18th, 2019, 9:09 am

I remember pre-ICBC here in BC. People involved in collisions with other vehicles often had their cars, which they were making payments on, stored in the back lots of body shops for six to eight months while their insurance company was fighting it out with the other insurance company as to who was responsible for the accident, and which insurance company was going to pay for it...
I wonder if that is still happening in provinces with private insurance.
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Re: Insurance Bureau of Canada : ICBC Needs Competition

Postby jimmy4321 » Aug 18th, 2019, 9:26 am

Growing up with private insurance , friends & family with private insurance , my father caught up in a couple accidents this is the first i've heard of such a thing.

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Re: Insurance Bureau of Canada : ICBC Needs Competition

Postby Hurtlander » Aug 18th, 2019, 10:35 am

jimmy4321 wrote:Growing up with private insurance , friends & family with private insurance , my father caught up in a couple accidents this is the first i've heard of such a thing.

I’m not talking about singing vehicle accidents, I’m talking about when two vehicles collide at an intersection or some similar situation and each vehicle has a different insurance provider.. it can often take a long time to sort out who’s responsible and who’s insurance provider is going to pay... ICBC simply fixes the damaged vehicles immediately, accuses both parties as being at fault, raising both parties premiums.
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Re: Insurance Bureau of Canada : ICBC Needs Competition

Postby OKkayak » Aug 18th, 2019, 10:39 am

Hurtlander wrote:ICBC simply fixes the damaged vehicles immediately, accuses both parties as being at fault, raising both parties premiums.

So in other words, put part blame on someone who may not be at fault and cash in unless they choose to fight it. No wonder lawyers love ICBC, big business for them.
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