A new five year ICBC projection shows British Columbian drivers could be on the hook for an insurance rate hike in the ball park of 40 per cent.
ICBC has delivered a trio of forecasts to the BC Utilities commission, one of them showing possible rate hikes of six, eight, and even nine percent in coming years.
But according to Transport Minister Todd Stone, these alarming numbers aren’t ones that drivers will actually see.
“Based on an extreme, worst case, hypothetical situation. I want to reassure the public that these are extreme projections, that do not consider the actions that the B.C. government and ICBC are taking,” he said.
Stone says the projection assumes no progress from anti-fraud and distracted driving campaigns, and says the province is moving to stop insuring expensive luxury vehicles.
Richard McCandless says the projection shows a 6.4 per cent increase next year, and a peak of 9.4 per cent in 2019, but that assumes hundreds of millions of dollars in capital reserves that he doesn’t think exist.
“They’re going to find $330-million from somewhere. And I’ve been saying they are out of money in their capital, unless they increase their risk, so where is that [$330-million] going to come from?” he said.
The Transportation Minister says the projections are just hypothetical situations.
“They don’t explain the other components of rate change going down, they don’t give the net income, they don’t give the total equity. There are all things somebody needs to do a proper analysis,” McCandless said.
Wednesday was the deadline the BC Utilities Commission set for the numbers to be released.
In an effort to control these rising insurance rates, Transportation Minister Todd Stone says the province is moving towards no longer insuring high-end luxury cars valued at $150,000 and up.
“Private owners of these cars will have to purchase their insurance through private insurance providers,” said Stone.
Stone says the high-end luxury car market is growing, with 3,000 cars insured this past year, a 30 per cent increase compared to three years ago.
Stone says until new policy in place, luxury drivers will see rates double, premiums hiked— Simon Little (@simonplittle) November 23, 2016
Changes won't affect commercial vehicles, pickup trucks, limos, ect— Simon Little (@simonplittle) November 23, 2016
He says the province is responding to rising costs to repair these cars and to eliminate any pressures they cause on basic insurance vehicle rates.
Stone says the changes won’t affect commercial vehicles, and that until they’re in place, premiums will double for luxury owners.
But he couldn’t say how much money the change is projected to save.
Currently, drivers of a Tesla or a Toyota pay roughly the same rates.
Luxury car announcement a distraction from rate hikes: Adrian Dix
But NDP ICBC Critic Adrian Dix says the announcement is an attempt to distract the public from newly revealed potential double digit rate increases.
Dix says the Clark government has been using ICBC as a piggy bank: syphoning off more than $1.5-billion in recent years.
And he says the luxury car move is a bid to take eyes off estimates provided by the Crown Corporation to the B.C. utilities commission today showing a possible nearly 40-percent rate increase over the next five years.
“So what we have is a government that has used ICBC, has misled the public, was forced to reveal its after election plan which is massive rate increases today, and is doing its usual sound and light show around this, you know, look at a Ferrari,” he said.
Dix says, if elected, the NDP would return the corporation to its non profit status, though admits even they would be hard pressed to stop coming rate hikes.
With files from Liza Yuzda and Simon Little