IBC: British Columbia auto insurance consumers want competition
Published: October 20, 2017
Updated: July 24, 2018
Author: Luke Jones
CATEGORY: Car Insurance
The Insurance Bureau of Canada (IBC) has conducted a survey in British Columbia and found an overwhelming number of customers in the province (78%) want more auto insurance choice and competition.
Maple Leaf Strategies conducted the survey on behalf of the IBC, polling 1,000 B.C. residents between September 25 and October 1, 2017. 89% of those asked want more competition and believe they should have the right to shop around for coverage in an effort to save on auto insurance.
British Columbia operates a public auto insurance model with basic policies only available through the Insurance Corporation of British Columbia (ICBC). The Crown corporation has been under fire in recet months after it was found the company cannout financially operate without raising auto premiums by up to 30%.
“Competition provides a powerful incentive for any company to keep prices down, to deliver the best service, and to understand and meet the needs of its customers. Auto insurance is no exception to this rule,” commented IBC Pacific vice-president Aaron Sutherland.
“These polling results show that British Columbians overwhelmingly want the ability to choose the auto insurance provider that is best for them. Canada’s private insurers are eager to better serve BC drivers so that they can take advantage of the benefits of competition and choice in auto insurance.”
Other findings of the survey include:
- Almost a third of BC drivers say that they have a very unfavorable view of the current auto insurance marketplace – four times as many as those who said they have a favorable view.
- Seventy-four per cent (74%) of drivers said that increased competition will be better for the province’s economy overall.
- Eighty-five per cent (85%) say that competition provides a powerful incentive for insurers to keep their prices down and to deliver the best service possible.
The survey follows the recent report into the B.C. auto insurance company, the ICBC. The report was commissioned by the former Liberal government, which asked Ernst & Young to look into the state of the ICBC. The results were startling and suggest an overhaul of the insurance market in B.C. is needed.
While Attorney General (and man in charge of the ICBC) David Eby has said he will not oversee drastic premium rises, he has described the report as very worrying.
“This is a very serious and a very grave concern,” Eby said. “We will take the steps necessary to fix what is happening at ICBC, to make British Columbia’s roads safer for British Columbians and to ensure that rates are affordable for British Columbians, because clearly that is not where we are tracking right now.”
Car collisions have increased in British Columbia in recent years while repairing vehicles, covering medical costs, and dealing with claims have also surged. The combination has put the insurance company in a tough fiscal situation. Eby says he will not allow auto insurance premiums to soar, but has not detailed how he plans to save the ICBC.
One suggestion has been to re-introduce photo radar systems, but Eby has been dismissive of the call. Eby insists the former government tried too hard to shield customers from a rise in auto insurance premiums and has placed the ICBC in financial peril.
It is unclear whether Eby will pursue the reports suggestions, which include limiting payments for pain and sufferings, charging high-risk drivers more for coverage, and raising premiums for luxury vehicles.
“ICBC has been careening toward a crisis over at least the last couple of years. This should have been an election issue,” Eby stated. “Our goal is to make roads as safe as possible and to make sure that rates stay affordable for British Columbians, and that’s what we’ll be doing. It was not a priority of the previous government, obviously.”