ICBC to cut ad budget in half to focus on policing
Published: November 29, 2018
CATEGORY: Car Insurance
British Columbia continues to search for ways to ease the financial pressures on the Insurance Corporation of British Columbia (ICBC). The latest measure introduced by the province’s Attorney General will see the ICBC cut its annual advertising budget by half.
With the money saved, the public insurance provider will redirect the finds to road safety enforcement in British Columbia. According to the ICBC, the cuts will allow $2.4 million to flow towards policing within the RCMP and municipal forces.
“ICBC is facing significant cost pressures that really start from one place — crashes,” ICBC CEO Nicolas Jimenez said in the statement.
“With crashes at an all-time high in our province, we’re committed to doing what we can to reduce claims costs and relieve the pressure on insurance rates.”
While the savings are merely a dent in the corporations financial problems (the ICBC lost over $500 million so far this year), the refocus of funds makes sense.
Firstly, the ICBC is a public insurance provider and the only avenue for motorists in BC for basic auto insurance. Advertising should be minimal as the company faces no competition from private companies. Law abiding motorists must go to the ICBC for coverage and don’t need to be sold on products.
Secondly, the public corporation says the chief reason for its financial troubles are rising collisions and claims costs. Most collisions are caused by human error and infractions, such as distracted driving, speeding, impaired driving, and so on. With more focus on policing, the ICBC hopes to reduce collisions and save money.
To emphasize the point, the company says there were 350,000 collisions in British Columbia during 2017, averaging 960 each day.
“It is now clear that this government needs to look for even more ways — beyond what is already planned — to further reduce the escalating cost of claims,” B.C. Attorney General David Eby said Friday.