How British Columbia plans to save its public auto insurer $1 billion annually

Published: November 15, 2018

Updated: November 22, 2018

Author: Luke Jones



British Columbia is seeking to make substantial savings in auto insurance and help its financially stricken public insurer. By making changes to accident benefits laws, the province aims to save the Insurance Corporation of British Columbia (ICBC) around $1 billion each year.

Speaking last week, British Columbia’s Ministry of Attorney General announced its plans for the changes. The office confirmed changing regulations for accident benefits will cost the ICBC $200 million each year. However, the cost will be offset by an estimated saving of $1.2 billion annually. In its release, the ministry said savings will come from a limit on payouts for pain and suffering from minor injuries and reduced legal costs.

The changes are part of an ongoing effort to bring financial buoyancy to the province’s public auto insurance provider.

The Insurance Corporation of British Columbia (ICBC) has been in the spotlight recently after a 2017 report found the public insurer is in financial danger. Now, an economics leader has said the current situation the insurer finds itself in is “unsustainable” and that its problems are from causes it cannot affect.

When the report was published, it was suggested the B.C. standard auto insurance provider would have to increase premiums by 30% just to survive. During 2016-17, the ICBC lost a record $889 million, and projections for last year suggest the company will lose $1.3 billion when its financial year ends.


Under new amendments to the Insurance (Vehicle) Regulation and the Minor Injury Regulation, the following changes will be effective April 1, 2019:

  • Medical care and recover cost allowance will be doubled to $300,000. This change will be retroactive to Jan. 1, 2018.
  • $5,500 limit on pain and suffering from minor injury claims. ICBC says the cost of covering these claims has increased 265% since 2000. Furthermore, new treatment protocol guidelines for examination, assessment, diagnosis, and treatment of minor injuries will be introduced.
  • Updated treatment fees and what treatments will be covered by ICBC.
  • Double the wage loss benefits for injured claimants who are unable to work, up to $740 per week.

“These changes will be in effect for any new claims that occur on or after April 1, 2019, and will make ICBC’s accident benefits among the most generous of tort systems across Canada,” an ICBC spokesperson said Tuesday.

“The regulations announced by government will help to create a more sustainable auto insurance system in B.C. and provide increased care for anyone injured in a crash,” said Nicolas Jimenez, president and CEO of ICBC. “B.C. is the last province in Canada to introduce some form of restriction on minor injury payments – other provinces have made changes which have helped lower claims costs and insurance rates, while improving care for the injured.”