BC announces changes to ICBC after insurer reports $1 billion loss

Changes made to claims and accident benefits

BC announces changes to ICBC after insurer reports $1 billion loss

Insurance News

By Alicja Grzadkowska

The government of British Columbia announced it’s making changes to the ICBC to address the Crown corporation’s $1.3 billion net loss for 2017-2018.

The changes, taking effect April 01, 2019, include a new limit of $5,500 on pain and suffering for minor injury claims, a doubling of the medical care and recovery cost allowance to $300,000, and an independent dispute resolution process for certain motor vehicle injury claims.

“The savings from this change, when coupled with other planned initiatives, will restore ICBC to financial sustainability and finance the planned accident benefit improvements,” the BC government stated in its release, which points to ICBC’s spending on legal fees and claims as one of the drains on ICBC’s budget.

The changes are aimed at reducing ICBC’s claims costs by more than $1 billion annually, and putting the provincial insurer back on track to keep its rates affordable for drivers.

The ICBC will also involve customers in consultations as it revises its rate structure in an attempt to ensure “good drivers pay less, and bad drivers pay more,” according to the release.

As part of the changes, accident benefits will cover a greater variety of treatment services and increase the amount covered for care, thereby reducing how much customers pay out-of-pocket. Wage loss payments will double to $740 a week, as will home support benefits to $280 a week, and funeral cost coverage will triple to $7,500.

“Today we start making the tough decisions that will stem ICBC’s losses, keep insurance affordable and provide enhanced care for people injured in automobile accidents. We’re going to make ICBC work for people again,” Attorney General David Eby announced.

Related stories:
ICBC reacts to report detailing its shortfalls
IBC calls for more auto insurance competition in BC

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