ICBC Withdraws Rates Increase Proposal

Update: see previous post – May 6, 2011 ICBC Plans to Raise Rates

Shirley Bond, who was appointed by the B.C. Liberals on March 14, 2011 as the Minister of Public Safety and Solicitor General, has closed the option of ICBC dramatically raising the auto-insurance rates in B.C.

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British Columbian’s were extremely upset about the Insurance Corporation of British Columbia’s announcement of a potential cash grab. This news should allay some of their fears.

The Insurance Corporation of British Columbia (ICBC) has withdrawn its rate restructuring proposal (1 speeding ticket = $1000.00 additional insurance premium, per person,  per year,  over 3 years) and committed to province wide consultation on other options for improving the way risks are shared among its customers.

The move follows a meeting with the Minister of Public Safety and Solicitor General Shirley Bond, who stated that ICBC has been instructed to ensure it applies a test of, “being reasonable – and a hike in premiums for a single speeding ticket is not reasonable.”

“While the principles of a rate structure that differentiates between good drivers and bad drivers is worth considering, I’ve directed ICBC to go back to the drawing board and rethink the options,” said Bond. “My job is to make sure that I’m looking after what’s best for B.C. families.”

“We didn’t do a good enough job of communicating with the public or with government about the changes we were considering, and we apologize for the concern this caused,” said Jon Schubert, ICBC’s president and CEO. “We’re going to take a step back and rethink the options for a reasonable way to share risk, and we’ll do a much better job of gathering public input.”

With the Provincial H.S.T. referendum vote on the horizon, the Province has told Jon Schubert, ICBC’s president and CEO "don't go there" with respect to substantial changes and raises in premiums for minor traffic violations. ICBC insures over 3 million drivers in the Province of British Columbia. Many are breathing a sigh of relief after the Public Safety Minister, Shirley Bond applied the brakes to Jon Schubert's untimely plans.

ICBC will undertake a province wide consultation to solicit input on a range of options. The consultation will encourage British Columbians to provide input through a range of tools such as stakeholder meetings, open houses and online feedback. Details on where and how customers can provide feedback will be announced in the coming weeks.

“It is really important for us to get this right for our customers,” said Schubert. “I want to assure customers that we will not recommend any changes without much broader consultation.”

Bond, who first learned of the proposed change in the news media, said the government has told ICBC to apply a test of “being reasonable” in its mandate to deter risky drivers.

“A hike in premiums for a single speeding ticket is not reasonable,” said Bond, who also is public safety minister.

Currently a driver who commits a moving violation receives a fine and penalty points on his or her driving record.

Incurring only one speeding ticket, worth three points, in a 12-month period would not cost a driver anything, but four or more points in that period would.

“I’ve directed ICBC to go back to the drawing board and rethink the options,” Bond said in the statement released by the Crown-owned monopoly.

“It is really important for us to get this right for our customers,” Schubert said. “I want to assure customers that we will not recommend any changes without much broader consultation.”

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