ICBC will file a basic insurance rate application with the British Columbia Utilities Commission (BCUC) today. If the application is approved, the average impact on the vast majority of customers will be less than a dollar a month when combined with changes to ICBC’s optional insurance rates.

The basic insurance rate application will ask BCUC to approve a 4.9%  increase to basic insurance rates, effective November 1 on an interim basis. BCUC’s full review of the basic insurance rate application will likely not be complete until a later date.

About 80 per cent of customers – those who purchase their full personal vehicle insurance coverage with ICBC – will see a combined average increase of about $11 a year or 92¢ per month.

The pressure on basic insurance rates is coming from bodily injury claims costs, which cover payouts for pain and suffering, future care and loss of wages. ICBC’s bodily injury claims costs totalled $1.9 billion in 2012 – up by more than $165 million from the previous year and more than $400 million from just five years ago. The majority of these payments are made under ICBC’s basic insurance coverage.

From the President

We are also able to reduce our optional rates which will lessen the impact on our customers. As a result, about 80 per cent of customers – those who purchase their full personal vehicle insurance with ICBC – will see an average increase of less than a dollar a month.

There are various factors contributing to the increasing number of injury claims, including more crashes as a result of drivers being distracted behind the wheel by their smartphones, more pedestrians and cyclists on the road and more injury claims resulting from small crashes.

There are also various factors contributing to the increasing cost of injury claims we pay out but one particular contributing factor here in B.C. is an increase in lawyer-represented claims and resulting higher legal and medical costs.

While many external factors are beyond our control, we continue to look for ways to help stem the increase in injury costs. We believe the most effective way to address the issue is to focus on helping our customers access medical treatments and we are making several improvements to help achieve this.

Mark Blucher  Interim president & CEO, ICBC