British Columbians pay the highest on average in car insurance in Canada

British Columbians pay the most for car insurance in the country. Global News

Car owners in the province won’t be surprised, but British Columbians are still paying the highest auto insurance premiums in Canada.

The General Insurance Statistical Agency released numbers Tuesday showing that British Columbians pay an average of $1,832 for car insurance per year.

The organization gathering the information works behalf of insurance regulatory authorities that have private insurance options. B.C. is not a member of the organization.

The next-most-expensive province is Ontario, where drivers pay an average of $1,505 per year. Alberta rounds out the top three with an average of $1,316 a year.

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The Insurance Bureau of Canada (IBC) provided the numbers to Global News. The organization strongly favours private car insurance and has vocally criticized the Insurance Corporation of B.C. (ICBC), a public insurer that has a monopoly on basic insurance.

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“Under ICBC’s monopoly, British Columbians will again pay the highest auto insurance prices in Canada, with premiums now averaging $1,832 annually. While many important changes are underway in B.C., none are expected to begin to reduce the price most drivers are paying,” IBC vice-president Aaron Sutherland said.

“With ICBC stating that it will need price increases to raise over $1 billion in the years ahead, now, more than ever, the market must be opened to competition and choice to improve the affordability of auto insurance.”

ICBC is in the midst of a massive overhaul. In April, the province introduced a cap on injuries now defined as minor and soft tissue. The cap and the reduction in legal fees is expected to save the province more than $1 billion.

WATCH (aired June 6): ICBC changes could cost some drivers more

Click to play video: 'ICBC changes could cost some drivers more'
ICBC changes could cost some drivers more

Responding to the study, Attorney General David Eby says he agrees ‘rate affordability is a significant concern’ for British Columbians but private insurance is not the answer.

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“In fact, recent studies have shown that jurisdictions with private insurance are actually seeing some of the greatest recent increases in drivers’ premiums,” Eby said.

“For example, when you compare Q2 results to the same time last year, Ontario drivers saw the average cost of their insurance rise almost 14 per cent, while Alberta drivers are facing the steepest increase at over 16 per cent.”

ICBC says rates have gone up primarily because of an increase in crashes, more cases of fraud and soaring legal fees. The public insurer lost $1.1 billion last year.

“Whether we have a public or private auto insurance system in B.C., the same underlying problems of a high number of crashes and record-high numbers of claims and costs would still need to be addressed – simply changing to private insurance would not solve these issues,” ICBC spokesperson Joanna Linsangan said.

In September, the province is expected to introduce a new fee structure where “good drivers will pay less and bad drivers will pay more.” But the upcoming changes are expected to be revenue neutral.

The province also introduced sweeping changes in April that capped payments for ‘soft-tissue injuries’ and reduced the amount lawyers can collect in ICBC cases. The changes are being challenged in court but are estimated to save the insurance company more than $1 billion a year.

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“We are taking a different approach here in B.C. to fix the system. We are redirecting money from the pockets of lawyers and putting it back into better benefits and improved care for people injured in crashes,” Eby said.

“We will be monitoring the impacts of these changes and, if necessary, we will take further action to help ensure British Columbians have access to high-quality auto insurance at the lowest possible cost.”

WATCH (aired March 31, 2019): Exclusive: Trial Lawyers Association of B.C. fighting ICBC changes

Click to play video: 'Exclusive: Trial Lawyers Association of B.C. fighting ICBC changes'
Exclusive: Trial Lawyers Association of B.C. fighting ICBC changes

Earlier this year, the Insurance Bureau of Canada commissioned a report conducted by MNP accounting that imagined how much the same driver in the same car would pay in Alberta and British Columbia.

Take a small business owner named Bill, for example. He drives a Ford truck for work and would pay $2,058 a year for insurance in Surrey, compared to $1,399 in Calgary.

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That’s a difference of $659.

WATCH (aired March 20, 2019): B.C. drivers pay much more for insurance than Albertans

Click to play video: 'B.C. drivers pay much more for insurance than Albertans'
B.C. drivers pay much more for insurance than Albertans

MNP also imagined a family of three that drives a 2012 Honda Accord with no at-fault crashes. In Kelowna, the family would pay $1,688 to insure their car, $563 more than they would pay in in Red Deer.

Finally, the firm came up with 26-year-old Caitlin, who also has no at-fault crashes. She drives a 2014 Honda Civic and would pay $2,897 annually for insurance in Vancouver compared to $2,209 in Calgary, a difference of nearly $700.

“Competition is a powerful incentive for any company to deliver the best product at the best possible price. Auto insurance is no exception to this rule,” Sutherland said.

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“Today’s numbers are yet further evidence of the need to open ICBC to competition and give British Columbians the ability to shop around for their auto insurance needs.”

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