Four ways to fix ICBC

Penticton Herald - - OPINION -

Yes, the In­sur­ance Corp. of B.C. has been mis­man­aged and is in cri­sis, los­ing $913 mil­lion last year. But that’s the past. The is­sue now is how to fix the prob­lems and set the cor­po­ra­tion on a sus­tain­able course.

Al­most ev­ery Bri­tish Columbian has a stake in see­ing that done quickly and pru­dently, in a way that main­tains pro­tec­tion for those hurt in crashes while keep­ing rates af­ford­able.

The Ernst and Young re­port com­mis­sioned by the for­mer gov­ern­ment of­fers an ex­cel­lent start­ing point, and At­tor­ney Gen­eral David Eby has taken some first steps, in­clud­ing in­creas­ing the hours for red-light cam­eras, which in­ex­pli­ca­bly have been turned off 18 hours of ev­ery day. There are four key ar­eas to pur­sue. First, ICBC’s costs need to be re­viewed to en­sure all savings have been re­al­ized (al­though its op­er­at­ing costs are about 40 per cent lower than the Cana­dian av­er­age, Ernst and Young found). A re­view is un­der way.

Sec­ond, the gov­ern­ment needs to find ways to re­duce the num­ber of claims. Crashes have in­creased 23 per cent in the past three years, and B.C. now has the third-high­est crash rate among prov­inces.

The ob­vi­ous solutions are road im­prove­ments to high-crash routes and im­proved en­force­ment.

While crashes have been in­creas­ing, en­force­ment has been go­ing in the other di­rec­tion. The num­ber of tick­ets and charges for three key road of­fences — speed­ing, dis­tracted driv­ing and im­paired driv­ing — has fallen by 11 per cent in the past two years. Fa­tal­i­ties linked to those of­fences in­creased by 13 per cent in the same pe­riod.

Sim­ple mea­sures such as speed cam­eras and in­creas­ing the num­ber of red-light cam­eras while al­low­ing them to cap­ture pho­tos of peo­ple speed­ing through in­ter­sec­tions would save ICBC about $250 mil­lion a year, ac­cord­ing to Ernst and Young — enough to cut pre­mi­ums by $75.

Third, the gov­ern­ment needs to tackle the ris­ing cost of claims. And this is where great care and pub­lic con­sul­ta­tion are needed.

The ob­vi­ous so­lu­tion is to move to no­fault in­sur­ance, as pro­posed — and aban­doned — by the for­mer NDP gov­ern­ment a gen­er­a­tion ago. No-fault in­sur­ance sets a fixed sched­ule of pay­ments for peo­ple in­jured in crashes, typ­i­cally elim­i­nates the pos­si­bil­ity of awards for pain and suf­fer­ing and elim­i­nates much of the le­gal wran­gling about li­a­bil­ity.

Ernst and Young notes the av­er­age ICBC set­tle­ment for mi­nor in­juries has more than tripled since 2000, with pain-and-suf­fer­ing awards mak­ing up about half the costs.

The ap­peal — and big savings — are ob­vi­ous. But the ef­fect on in­jured driv­ers and pas­sen­gers is sig­nif­i­cant, and a full pub­lic dis­cus­sion is needed.

This would be an ex­cel­lent op­por­tu­nity for the new gov­ern­ment to make use of an all-party leg­isla­tive com­mit­tee to re­view the is­sues and make rec­om­men­da­tions.

One so­lu­tion is to fol­low the path of Saskatchewan, which of­fers driv­ers both op­tions, with no-fault much less ex­pen­sive.

ICBC needs to change. But the changes need to be made care­fully and with full pub­lic in­volve­ment.

— Vic­to­ria Times Colonist

To en­sure savings, all costs must be re­viewed

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