The government in British Columbia has announced its latest step to save money for the provincial public auto Insurance Corporation of British Columbia (ICBC). In a release on Tuesday, the government said it will start a $5,500 cap program on pain and suffering for pay-outs for collision victims.
It is hoped the move will help the ICBC save $1 billion a year. The cap was announced by Attorney General David Eby says the limit on injury claims will not be in effect until April 2019 and will be part of upcoming legislation created by the New Democrat government in British Columbia.
The ICBC recorded over $900 million in losses through the first nine months of its fiscal year, following a report last summer that showed the company is in financial trouble. It is believed auto premiums in B.C. would have to be raised by 30% to break even. Eby has said this will not happen, although premiums have increased by around 10%.
Even so, the ICBC is still in trouble and people are hunting for answers. Eby has consistently blamed the former Liberal government for taking nearly $2 billion surplus from the Crown Corporation. He has also ruled out allowing private companies to offer mandatory auto insurance in B.C.
Eby adds that new legislation will only be one component of a series of changes coming to the ICBC as it attempts to stem losses. Instant changes to the Crown corporation include doubling the mount of funds available for care and recovery to $300,000.