ICBC on track for $890-million loss

VANCOUVER (NEWS 1130) – Another massive loss has been recorded by B.C.’s public auto insurer.

ICBC has posted a net loss of $582 million for the first six months of the fiscal year.

The insurer is now projecting a year-end loss of $890 million.

Back in January, Attorney General David Eby called last year’s $1.3-billion deficit a “financial dumpster fire.”

Eby points to higher bodily injury costs and lengthier process times for claims.

“A key driver of these costs is a growing trend toward plaintiff lawyers strategically building the value of the claim — costs which have to be paid for by ICBC ratepayers,” he said in a news release.

“These trends are becoming more severe. Since March 2017, the dollar value of settlements demanded by plaintiff lawyers for litigated files increased by 27 per cent.”

RELATED: Changes coming to ICBC injury payouts

Eby says the average cost of a closed case in the first six months of ICBC’s fiscal year rose by 21 per cent year over year.

“ICBC’s net claims incurred for the first six months of its fiscal year alone topped $3 billion, an increase of $634 million, or 26 per cent, over the same period last year ($2.4 billion),” ICBC said in a news release.

Meanwhile, ICB president and CEO Nicolas Jimenez said it’s been a “challenging year.”

“We are seeing more crashes and they are costing more,” said Jimenez. “We are actually going to have for the second year in a row the highest number of crashes in our history.”

But when it comes to how this will impact rates, Jimenez said drivers will have to wait and see until ICBC goes to the BC Utilities Commission next month.

“I will tell you this is definitely putting pressure on the system. There’s no question that this is a challenging environment,” Jimenez added.

Changes to ICBC’s rate structure take effect next year.

There are changes to the Driver Penalty Point premiums, which are for drivers who receive four or more penalty points in a one-year period.

 

There are also changes to the Driver Risk Premiums program, which applies to drivers who have a driving-related Criminal Code conviction, a roadside suspension or prohibition, or is guilty of excessive speeding or distracted driving.

Drivers who travel less than 5,000 kilometres per year will be eligible for a 10 per cent discount.

 – With files from Marcella Bernardo and Hana Mae Nassar