By: Luke Jones, Published on August 10, 2018 06:50 AM, Last Update on August 10, 2018 03:52 AM
Over the last year we’ve been asking what can be done for the Insurance Corporation of British Columbia (ICBC). Rocked by a financial crisis, the public insurer has been seeking ways to offset rising claims and repair costs to return to profitability. Now, the company is proposing to overhaul the auto insurance rating system in British Columbia.
In a new release, ICBC says it wants to implement a “fair rate” system for auto insurance, which would put more emphasis on high-risk drivers covering costs through higher premiums.
“We want to make Basic insurance premiums more fair by holding all drivers more accountable for their driving decisions and behaviour,” ICBC says. “That means drivers should pay the right premium for the risk they represent on our roads.”
High-risk drivers are those who are (as the name suggests) considered to be a higher risk for an insurance company. These drivers can be deemed high risk for several reasons:
ICBC’s proposal is in front of the B.C. Utilities Commission, the regulatory body that decides changes in the auto insurance market. If approved, the new system would come into effect starting September 2019. The insurer says it will decide the cost of basic car insurance by discounts and add-ons, type of vehicles, and driver history.
“Right now, these factors affect your premiums, but only in a limited way,” ICBC says. “In the future, these two factors would have a greater impact on your premiums than they do today.”
“We would look at a customer’s at-fault crashes over the past 10 years,” ICBC says. “To minimize impacts upon implementation, we would only look back to Mar. 1, 2017 of at-fault claims history. Claims older than Mar. 1, 2017 would not be used in the new premium calculation. Each year thereafter, we would extend the scan period by one year, until 2027 when the full 10-year scan period would be in place.”