If you lend your car out to occasional drivers, you’ll now get 1 free crash, ICBC says

If this happens to your vehicle with an unlisted driver behind the wheel, ICBC says the first crash is free before you may consider opting into its "unlisted driver protection" fee. Global News

British Columbians who lend their car out to the occasional friend or family member will now get one free crash before having to buy into a controversial ICBC fee.

The insurer introduced “unlisted driver protection” last September, asking drivers to consider paying a $50 fee to protect themselves in case someone not listed on their policy crashes their car.

Now, ICBC says the first crash will come free for any of the policyholder’s vehicles. After that, drivers will still have the choice to opt into the one-time fee, or face thousands of dollars in liabilities.

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Unlisted drivers are considered people who drive a vehicle 12 times a year or less.

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The change would take effect Sept. 1 if approved by the B.C. Utilities Commission (BCUC).

READ MORE: Lend your car out from time to time? There’s now an ICBC fee for that

At the time the original policy was announced, critics immediately called it a “cash grab,” while Mothers Against Drunk Driving suggested the measure could discourage designated drivers.

Speaking Friday, ICBC policy expert Richard McCandless said the one free crash was a step in the right direction, but added the fee still shouldn’t exist.

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“Now it’s a little better, but it’s still fundamentally flawed,” he said. “It was just poorly conceived — just the wrong way to go.”

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It was estimated last year that if every ICBC policyholder in B.C. purchased the new protection, it would net the corporation roughly $120 million a year.

ICBC insisted they weren’t taking a dime, and that the money would be returned to drivers elsewhere.

READ MORE: New ICBC fee for lending vehicles could discourage designated drivers: MADD

McCandless said the fee especially doesn’t make sense if it’s meant to be revenue neutral.

“If they had said, ‘This is for our bottom line,’ that would be one thing, but they didn’t say that,” he said. “They said, ‘Give us $50 or face the consequences.’ It’s a protection racket.”

Under the old policy, if someone got in a crash behind the wheel of a borrowed car, it was a blight on the owner’s record and could cause their insurance premiums to go up.

READ MORE: ‘Massive changes’ at ICBC could fundamentally reshape the public insurer

The unlisted driver protection change was announced Friday along with other directives from the province to ICBC “that will improve fairness in how basic insurance is calculated, the attorney general’s ministry said in a release.

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Under the proposed changes, people will no longer be able to add low-risk drivers that are not household members or employees to their policies to artificially reduce their insurance premiums.

Additionally, the limitation period for drivers to decide whether to repay claims made between March 1, 2017, and Aug. 31, 2019, will be extended until Aug. 31, 2020.

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The ministry said the extension will ensure drivers “have enough information in the first year of the new rating model to decide whether repaying the claim benefits them by preventing increases to their insurance premiums.”

Those changes would also kick in Sept. 1, pending approval from the BCUC, which will have 10 days to grant approval after receiving ICBC’s application.

—With files from Global News’ Simon Little and Nadia Stewart

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