Private insurers say ICBC “fair rate” system is “long overdue”
Published: August 14, 2018
Private auto insurance companies have expressed their thoughts on the reforms proposed by the Insurance Corporation of British Columbia (ICBC). The public auto coverage provider announced a new “fair rate” system last week for the British Columbia market. Private insurers say the decision is “long overdue”.
The opinion of private insurance companies comes a day after brokers in the province offered their own. For private providers, the B.C. market is one they would like to enter. Indeed, the Insurance Bureau of Canada (IBC) has often called for the province to open its basic auto insurance market to competition.
Still, private companies say they welcome the proposed “fair rate” system, which would see ICBC put more premium burden on high-risk drivers.
“The best way we can incentivize better behaviour on our roads is by rewarding good drivers and by pricing high risk drivers appropriately to give them that financial motivation to pay more attention, to make sure they aren’t doing things like distracted driving,” Aaron Sutherland, vice president of the Insurance Bureau of Canada’s (IBC) Pacific region, said Friday. “My general thought is this is long overdue.”
CBC says it wants to implement a “fair rate” system for auto insurance, which would put more emphasis on high-risk drivers covering costs through higher premiums.
“We want to make Basic insurance premiums more fair by holding all drivers more accountable for their driving decisions and behaviour,” ICBC says. “That means drivers should pay the right premium for the risk they represent on our roads.”
High-risk drivers are those who are (as the name suggests) considered to be a higher risk for an insurance company. These drivers can be deemed high risk for several reasons:
- Convicted of a driving infraction (distracted driving, speeding, impaired driving, dangerous driving, etc.)
- Been involved in collisions
- Has not paid insurance premiums on time in the past