By: Luke Jones, Published on August 3, 2017 04:04 PM, Last Update on August 30, 2017 03:05 PM
Late last month, a leaked Ernst and Young report showed that the Insurance Corporation of British Columbia (ICBC) is in financial trouble and reform is necessary for the crown corporation to survive. One potential remedy would be to raise auto insurance premiums in British Columbia by 30% to offset rising collision rates and claims costs.
Speaking during a conference call, Intact Financial Corp. CEO Charles Brindamour was asked what his opinion is of the report.
It is worth noting that basic auto insurance in BC is provided by the ICBC and not private companies like Intact Insurance. The 195-page report titled Affordable and Effective Auto Insurance – a New Road Forward for British Columbia has left ICBC on the edge and authorities and experts confused about how to solve the problem.
Attorney General and ICBC overseer, David Eby, says he will not allow premiums to increase and instead blames the previous liberal government for taking money out of ICBC when there was a surplus.
“The first observation I would make is that if you let the government run what the private sector can do, you end up with shocks – like all of a sudden there is a 30% gap in premiums,” Brindamour said Wednesday during the Intact conference call. “Therefore, I think the first message would be it is better to have a competitive marketplace.”
Brindamour is not the first to suggest the B.C. market should be more competitive, removing the monopoly ICBC currently has. Intact’s operations in the province are solely to provide additional coverage, which is the remit of the private sector in B.C.
“Even when there is cost pressure going up you have options to find ways to get a better deal -which in this case will be tough, I think, for drivers in British Columbia,” Brindamour said. “I hope that in B.C. we are starting to think about introducing more competition in the marketplace.”