David Eby: BC Liberals said ICBC had an $11M deficit, but it was really $1B
The minister responsible for B.C’s cash-strapped public auto insurer is blaming the former BC Liberal government for a massive difference in the projections on losses at ICBC.
Speaking with CKNW’s Steele & Drex on Wednesday, Attorney General David Eby said the government projected an $11 million deficit for ICBC.
But he said that once he had his hands on the paperwork, he realized the figure was closer to $1 billion.
LISTEN: Attorney General David Eby and ICBC chair Joy MacPhail take your calls on car insurance
“The number that I got was $900 million that they lost, it was quite an astounding thing,” Eby said.
“The core of it is, it’s quite straightforward, is the amount of money they were taking in in premiums did not equal to the amount of money they were paying out in claims.”
What’s more, Eby projected that ICBC is on track to lose another $400 million to $500 million this year — despite a 6.4 per cent rate hike conditionally approved by the BC Utilities Commission (BCUC) earlier this month.
The rising pressures on the Crown corporation are due in large part to increasing costs from climbing numbers of crashes and growing injury payouts and legal costs, Eby said.
WATCH: ICBC and police ramp up efforts to crackdown on distracted drivers
But he also pointed a finger at the former BC Liberal government, who he accused of raiding ICBC to balance the provincial budget.
“[ICBC] used to have a lot of money in investments, they have to hold on to a certain amount of capital to be able to pay out when people make claims and invest that money,” he said.
“But the previous government had taken $1.1 billion out of that fund over the previous six years, and so that money wasn’t earning investment income.”
The BC Liberals did start making changes to try to shore up ICBC’s finances, including beefing up fraud detection and doubling premiums for luxury vehicles.
Eby said his government is now implementing its own suite of new changes to help stem the tide of red ink.
Those measures include the province’s latest crackdown on distracted drivers, with penalties climbing by about $750 for repeat offenders.
The province has also commissioned PricewaterhouseCoopers to probe allegations of fraud and overbilling by body shops, and is taking measures to increase road safety such as activating more red light cameras.
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