Following feedback from nearly 35,000 British Columbians, the Government of British Columbia is taking action toward making insurance rates more fair for B.C. drivers.
“Changes to our auto insurance rating system are long overdue,” said Attorney General David Eby. “The responses from the ICBC rate fairness engagement indicate the majority of British Columbians favour changes that will make insurance more affordable for low-risk drivers and see high-risk drivers pay increased insurance premiums to better reflect the risks they represent.”
Based on public feedback, the vast majority of British Columbians (82.3%) believe risky drivers should pay more. Feedback also shows a majority of those who responded agree that:
- The option to pay back claims should be changed (currently, customers can repay vehicle damage claims and not have their premiums affected).
- A driver-based system would be more fair, as insurance rates would be tied to drivers, rather than vehicle owners.
- Driving convictions should play a greater role on premiums.
Feedback was mixed regarding the penalty amount owners should pay if a crash is caused by an unlisted driver, as well as whether distance driven should play a greater role in determining insurance rates.
As a first step to improve rate fairness, government has asked ICBC to bring forward increases to the Driver Risk Premium (DRP) program (which includes excessive speeding, impaired driving and distracted driving), and the Driver Penalty Point (DPP) program for minor driving violations, to the B.C. Utilities Commission to be ready for implementation as early as fall 2018.
Once approved by the BCUC, these increases will result in penalty amounts increasing by 20% in the first year, and an additional 20% hike in the next year, to help make sure drivers are paying an appropriate amount that reflects their driving behaviours. Once these changes have been implemented, future penalty program premium increases are anticipated to be aligned with any future basic insurance rate changes.
“While moving quickly to implement changes for dangerous driving, we are also using this feedback to inform additional changes in the coming months to help make rates more fair for drivers,” said Eby. “This feedback will help ensure our improved auto insurance rating system is consistent with the values of British Columbians.”
ICBC rate fairness engagement report: http://engage.gov.bc.ca/ratefairness/
Information about ICBC’s current rate system and the propsals considered in the engagement: https://engage.gov.bc.ca/ratefairness/rate-fairness-101/
Launch of ICBC rate fairness engagement: https://news.gov.bc.ca/16522
A backgrounder follows.