Richard Truscott is the Vice-President, B.C. and Alberta, Canadian Federation of Independent Business (Submitted).

COLUMN: ICBC is not just broke, it’s broken

Richard Truscott is B.C. and Alberta vice-president at Canadian Federation of Independent Business

Anyone who runs a business understands that consumers wield tremendous power.

Competition drives the creation of new efficiencies and innovations that enable companies to deliver the best product at the best possible price. Businesses that fail to adapt and change rarely survive.

However, ICBC’s 40-year monopoly on car insurance is a clear exception to this rule. It’s in a financial black hole. As its finances have plummeted, its bureaucracy has grown so much that it now employs twice as many staff as any other Canadian insurer its size.

It’s well documented that the corporation is a financial disaster. While many solutions are being put forward, ICBC’s preferred response is always the same: higher prices or worse benefits. With no competition, there is no pressure to take a hard look at its own operations to find efficiencies and savings. Rather, it continues to push big rate increases on customers as a “solution.”

This year, its basic insurance rates are going up 6.3 per cent. Since 2012, basic insurance premiums have grown a staggering 54 per cent while pleas from British Columbians for other options have been ignored.

Instead of bold leadership, we’re seeing Band-Aid solutions that will result in customers being gouged in the years ahead. In fact, ICBC’s financial filings call for an additional $1.17 billion in price increases over the next three years.

All this from a government-run insurance company that has lost more than $3 billion in the past three years. ICBC is not just broke, it’s clearly broken.

READ MORE: ICBC in ‘financial dumpster fire,’ minister says

Like many residents, business owners are fed up. A survey of independent businesses in B.C. found 75 per cent want ICBC’s monopoly ended. They want a choice in where to buy car insurance, to shop around for their insurance needs – just like the vast majority of other Canadians.

And why wouldn’t they? The Crown corporation is implementing changes on Sept. 1 that will significantly disadvantage businesses. For instance, over the next 10 years, prices for business vehicles will increase by an additional four per cent on top of all of its other increases.

It will also require every driver who may even occasionally use a vehicle to be listed on the owner’s policy. For small businesses, this may be extremely onerous. Business owners will need to provide ICBC with the driver’s licence number and date of birth of each employee, even if they operate a company car as little as once a month. In addition, 25 per cent of prices will then be based on the worst driver listed, regardless of how little that employee uses the vehicle.

As a cherry on top, the insurer is extending the time it takes to receive the full safe-driving discount from nine years to 40. Put another way, anyone who is 16 years old today will have to wait until they are 56 to receive the full claims-free discount.

ICBC says all of its changes coming next week are “revenue neutral” in the first year. That begs the obvious question: What kind of rate hikes will year two bring?

Businesses cannot afford the ICBC price increases. Or, more simply, they cannot afford the ICBC monopoly. Now, more than ever, it’s time to allow choice in B.C.’s vehicle insurance market.

Richard Truscott is the B.C. and Alberta vice-president at the Canadian Federation of Independent Business

Like us on Facebook and follow us on Twitter

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Four activists face charges linked to 2019 Abbotsford hog-farm protest

Mischief and break-and-enter charges laid for incidents on four separate days prior to the protest

Three men face attempted murder charges after Harrison Hot Springs stabbing

Man, 24, sent to hospital with life-threatening injuries following attack Wednesday

‘Tiny home’ being built for Abbotsford woman with severe allergies

Online campaign raises $59,000 for custom cargo trailer for Katie Hobson

Chilliwack children can get tested locally, Fraser Health confirms

Erroneous information online and via 811 has many families driving to Abbotsford for testing

Face masks will be mandatory for customers at all Walmart locations

Requirement goes into effect on Wednesday, Aug. 12 across Canada

371 British Columbians battling COVID-19, health officials confirm

Thursday (Aug. 6) saw a second straight day of nearly 50 new confirmed cases

Visitors and non-residents entering closed remote B.C. First Nation’s territories

With limited resources, they say they don’t have any authority or power to enforce the closures

UBC loses appeal on Fisheries Act convictions

BC Supreme Court upholds order to pay $1.55-million fine

Masks to be mandatory on BC Transit, TransLink starting Aug. 24

Both BC Transit and TransLink made the announcement in separate press releases on Thursday

Acclaimed B.C. actor Brent Carver passes away

Carver, one of Canada’s greatest actors with a career spanning 40 years, passed away at home in Cranbrook

B.C. would not send students back to school if there was ‘overwhelming risk’: Horgan

Plan has left many parents across the province worried about their children’s safety

Canucks blank Wild 3-0, take series lead in penalty-filled NHL qualifying clash

Jacob Markstrom stops 27 shots to lead Vancouver past Minnesota

North Okanagan man chains himself to tree in protest of construction

Crews began work clearing space for a new facility Thursday, Aug. 6

Most Read