ICBC will be applying for a basic rate increase of 4.9 per cent, or about $3.50 a month for customer’s basic insurance coverage.
The corporation says the increase is due to an escalation in the number of crashes, the number of claims being filed and the cost of settling the claims.
It says crashes jumped by 15 per cent in two years and more vehicle damage claims are being reported than ever before. It also cites more expensive vehicle repair costs and more people being injured, which means more injury claims, as reasons for needing the increase.
“We certainly don’t like to have to ask our customers to pay more but these external pressures are very real and they have created a perfect storm, which we are struggling to hold off,” said Mark Blucher, ICBC’s president and CEO. “We’ve worked hard to get this rate increase lower than last year’s but the amount of basic premiums we collect will still not cover the increasing amount we’re paying out in basic claims costs.”
ICBC says to cover the cost of more crashes and claims, it would need to charge every customer approximately an extra $130 a year.
“It would not be right to increase our customers’ rates without first doing everything we can to hold off these rising external cost pressures,” said Blucher. “We’re looking at how other jurisdictions are dealing with some of the same challenges. However, all of the efforts we’re making won’t make the underlying causes of the rate increase go away on their own. We also need help from all British Columbians to help keep our roads safe. By driving safely you can help lower our claims costs and directly lower the rates you pay.”
If approved by the British Columbia Utilities Commission, the extra amount will be added to 2017 basic insurance.