Transportation and Infrastructure Minister Todd Stone has issued the following statement on the Insurance Corporation of British Columbia’s (ICBC) submission to the British Columbia Utilities Commission (BCUC) for next year’s Basic insurance rate:

“Over the last few weeks, staff from the Ministry of Transportation and Infrastructure and the Ministry of Finance have worked with ICBC to identify strategies to keep the 2015 Basic insurance rate increase as low as possible. Today, ICBC is applying to the BCUC for an increase of 5.5% to Basic insurance rates for the coming year. If approved, this will mean an average increase of $3.70 per month for customers’ Basic insurance coverage.

“British Columbians should know that after exploring a number of ideas, we used the only feasible option available to us right now that would reduce the proposed November rate increase. Government allowed ICBC to move $450 million from the Optional insurance side of its business to strengthen capital on the Basic insurance side. This is the maximum amount of transfer under the BCUC framework that will help lower Basic rates.

“In doing so, ICBC was able to apply for a Basic rate increase of 5.5%, which is similar to last year’s Basic rate increase. Without the action of government, the Basic rate increase for next year would have been 6.7%.

“While I’m disappointed that the proposed Basic rate increase for this coming year could not be lower, ICBC is facing serious cost pressures as a result of the complexity, frequency and severity of bodily injury claims. Last year, bodily injury costs totalled over $2.17 billion, up nearly 10% in one year, and this trend continues to grow.

“Fraudulent and exaggerated claims are also affecting the cost of Basic auto insurance. ICBC has already begun to take action against fraud by increasing its resources to target fraud prevention. These expanded resources will include better fraud detection tools and an increased focus on prosecuting those who commit fraud.

“Government is also working with ICBC to enhance customer service and make it easier and more convenient for British Columbians – particularly those in rural communities – to access the ICBC services. Work is already underway to identify options that will allow people to renew their insurance online through their broker, as well as options that make the day-to-day interactions with ICBC easier – such as enhancing online claim service, viewing and printing their driving record and claims history, or updating contact information.

“Over the course of the next year, government will continue to work with ICBC to identify and implement measures that will ease the pressure for future rate increases, to help ensure that ICBC insurance rates remain affordable for British Columbians.”