Increased basic insurance rates coming?
ICBC is looking to raise basic insurance rates by 6.3%.
The reason for this is an increased number of crashes and claims, forcing a project net loss of $890 million for this fiscal year. Factoring into the losses most of all, according to President and CEO Nicolas Jimenez, is injury costs.
“By virtue of those costing too much, we’ve seen really big increases in the last year alone associated with, we’ll call, aggressive legal tactics to drive up settlements. We’ve seen settlement demands from plaintiff lawyers go up 27% this year from last year.”
Major reforms to the auto insurance system in the province have been put in place to counter the challenges causing the deficit. BC is the last province in the country to introduce some form of restrictions to address rising minor injury claims payouts. Vehicle owners would have to face about a $360 increase to their basic insurance rates without these changes.
After the approved rate design takes effect next September, Jimenez said most customers should actually start to save a little bit.
“We’re going to actually see two-thirds of customers get less than a 6.3% increase and, in fact, one-third or about 25% of those customers are going to see a rate decrease.”
If approved, the new rate would take effect April 1st, 2019.