ICBC law may solve money woes: Eby
BACK IN BLACK: Capping minor injury claims to $5,500 and alternative dispute resolution could save $1b
VICTORIA — B.C.’s attorney general says caps on minor injury claims and a push to an out-of-court dispute resolution could save the Insurance Corp. of B.C. from its financial crisis, though legislation he proposed Monday offered only a vague roadmap for achieving such a goal.
David Eby said the legislation, if passed, would set a $5,500 cap on pain and suffering claims for B.C. motorists in minor crashes. It would redirect insurance disputes worth less than $50,000 away from expensive courtrooms and into a civil dispute resolution process.
“We hope and are advised this legislation might get ICBC back into the black, which means the savings are in the neighbourhood of $1 billion,” said Eby. ICBC is expecting a loss of $1.3 billion once all the figures are in for the fiscal year that ended March 31. It blamed rising legal costs and accident claims.
“The savings of getting the processes of minor injuries out of B.C. Supreme Court and into the civil resolution tribunal are so big that we can actually increase benefits that haven’t been increased in 25 years.”
ICBC has a monopoly on basic automobile insurance in B.C. The government has warned that, unless there are reforms, motorists could face rate hikes of more than $400 to keep ICBC afloat. B.C. was the last province in Canada with a purely litigation-based model, where drivers not at fault in a crash sue the at-fault driver for economic loss and suffering.
Eby said the new savings estimate is possible because ICBC has been “refining the definition of minor injury” since the cap was first announced in February.
But his legislation contained no concrete definition of minor injury, instead leaving the linchpin to regulations to be set by cabinet later. Much of the bill is similarly hollow, giving cabinet vast powers to set, change and otherwise redefine what constitutes a “minor injury” and the level of the cap as time goes on.
“The intent of these regulation-making powers is to ensure the statute can remain up to date in terms of costs and changing scenarios that might take place,” said Eby.
The changes since February are concerning because they have widened what is considered a minor injury and therefore subject to the cap, said John Rice, a Vancouver injury trial lawyer who represents the Trial Lawyers Association of B.C. He said the legislation “represents one of the most significant attacks on the legal rights of British Columbians in our province’s history.”
Louise Craig, a Vancouver physiotherapist and spokesperson for group Rights Over Arbitrary Decisions for British Columbians, said it’s good that government keeps talking about increasing medical benefits for those involved in a crash, but the loose definition of minor injury in Monday’s bill remains concerning.
“I think they are expanding it so that minor injuries encompass the vast majority of injuries that occur, and making the exception say a fractured bone or spinal cord injury,” said Craig.
Monday’s legislation was also silent on reforms Eby floated in March that would change the way drivers accumulate no-penalty crashes and the time it requires to reclaim discount rates after an accident.
Expanded health benefits to crash victims, such as doubling the amount for care and recovery, as well as expanding the overall lifetime medical care and recovery limits to $300,000 retroactive to Jan. 1 will also be set by cabinet regulation in the future.
“These are huge changes for British Columbia, these are huge changes for ICBC,” said Eby. “We want to make sure we have the flexibility to respond as we roll things out.”