The BC Government has announced changes in the works for ICBC, claiming these will remove lawyers and legal costs from the system “to reduce rates and substantially increase care benefits, making public auto insurance work for British Columbians again.”
The new system is referred to as a “care-based” system. Here’s what the government’s press release says:
Legislation will be introduced in the coming weeks that will lower ICBC premiums by approximately 20% – an average of $400 in savings per driver. At the same time, maximum care and treatment benefits for anyone injured in a crash will increase to at least $7.5 million, and new benefits will provide care for those most seriously injured, for as long as they need it. These benefits will be available to every British Columbian without having to hire a lawyer.
These improvements will be achieved by removing the majority of legal fees and other costs associated with the current litigation-based system. The new care-based insurance system is forecast to remove more than $1.5 billion in the first full year, savings that will be passed on to ICBC customers through lowered insurance rates.
To give British Columbians confidence that they will be treated fairly, the planned legislation will require ICBC, by law, to assist every person who makes a claim and endeavour to ensure they receive all of the care and benefits to which they are entitled. Customers who still have complaints or disputes about their claim, benefit payments or fairness issues wil not need a lawyer to have them resolved. They will have recourse through:
- the Civil Resolution Tribunal, which is independent of ICBC;
- the B.C. ombudsperson; and
- the upcoming ICBC fairness officer, who will be appointed by government to ensure greater independence from ICBC.
As ICBC transitions to this new care-based model, government’s previous work to improve the finances at ICBC means there will be no basic rate change this year. The 0% basic rate change that takes effect on April 1, 2020, is the lowest any government has delivered in almost a decade. Without significant changes, rates would need to continue to rise by about 35% over the next five years.
Highlights of Enhanced Care coverage:
Government will introduce legislation to create the new care-based system, which would take effect on May 1, 2021, so that British Columbians will benefit from:
- average savings of $400 on their premium, compared with the previous full-year policy;
- care and treatment benefits that are 24 times higher than today, up to at least $7.5 million;
- wage loss coverage that is 60% higher than today; and
- new benefits – such as benefits for full-time students, caregivers, those working in the family business or those approaching retirement, who suffer income loss following a crash – replacing lump-sum payments that were previously awarded only through lengthy and expensive litigation.
Christine Bradstock, CEO, Physiotherapy Association of BC, reacts to the announcement:
“As physiotherapists, we often see patients who require longer treatment times in order to fully recover or get back to full function. With these changes, patients will have the peace of mind knowing that their care and treatment benefits will be there when they need them and for as long as they need to get better and return to their daily lives.”
Dr. Kathleen Ross, president, Doctors of BC, commented,“As physicians, our priority is to ensure that patients get the best possible care. The new care-based model provides significantly better coverage for people injured in traffic accidents through major increases in the level of medical care and supports for recovery. Doctors of BC looks forward to working with government and ICBC to help inform the transition to this enhanced care model.”
- Similar care-based insurance systems exist in Manitoba and Saskatchewan. Those systems have kept rate changes steady, near 0%.
- Under Enhanced Care coverage, a driver who is responsible for a crash will continue to be found at fault. This will remain a primary factor in what drivers pay for their insurance. If a driver causes a crash, their premiums will go up.
- Those injured by dangerous drivers convicted of certain Criminal Code offences, such as impaired driving, will still be able to sue for additional compensation.