B.C. drivers are paying as much as 42% more than Albertans for insurance, a report suggests

VANCOUVER -- A report released by the Insurance Bureau of Canada suggests some B.C. drivers pay significantly more than their neighbours to the east.

The IBC made public Tuesday a report from Calgary-based accounting firm MNP, which suggests it costs more to be a driver on the West Coast than in Alberta.

MNP suggests drivers insured through the Insurance Corporation of British Columbia – B.C.'s only auto insurance option – pay up to 42 per cent more.

The firm looked at quotes obtained through brokers in both provinces for 14 different drivers, then compared the prices for those drivers, with the same vehicles and same coverage, in what it calls "comparable locations across both provinces."

One example MNP gave was a driver in Surrey, B.C., and in Calgary.

The study said the hypothetical driver, a 49-year-old business owner, would pay $573 more for a year of insurance on a 2014 Ford F-150 in Surrey than in Alberta's largest city.

A driver of a 2008 Honda Civic with two years of experience was quoted at $4,319 from ICBC in Surrey. The quote in Calgary was more than $800 lower, according to MNP.

The study suggests there isn't much difference in what you get for your money between the provinces.

Plans Alberta and B.C. both have tort-based systems that allow a driver to sue for pain and suffering.

There are similar payouts for injury claims, and similar limits on awards. Mandatory coverage is also similar, MNP said.

IBC's vice-president of its Pacific region said the key difference is who's selling.

"This study gives an apples-to-apples comparison of the price drivers are paying for similar auto insurance coverage in BC and Alberta, and clearly demonstrates the price impact of ICBC's monopoly," Aaron Sutherland said in a statement.

Last year, as part of a series on ICBC, CTV News spoke to a motorcyclist who'd moved from Alberta to B.C.'s Okanagan. When he switched his insurance over, he said he was shocked to find that a year of full coverage would cost $2,200.

"That's compared to $350," Jim Gurney said at the time.

When asked about the disparity, an ICBC spokesperson said in an email that in B.C., motorcycle season is year round in some parts of the province, and because ICBC deals with claims year round, the associated claim costs are higher.

Joanna Linsangan also noted that "diverse terrain and changes in elevation… can make driving more challenging and pose more risk of crashes than in Alberta," and that B.C. has a larger population and more densely populated areas.

Finally, ICBC outlined differences in insurance coverage, including the example of medical benefits in B.C. which as of April 1 have doubled to $300,000 – "six times as much as those in Alberta." 
 

'Insurance is too expensive'

When it comes to the MNP report, the provincial Ministry of the Attorney General said it's aware that insurance is still too expensive for B.C. residents, but reiterated its believe that a privatized system would cost more.

"Private insurers issued a report last year that told British Columbians that if they were allowed to sell basic insurance in B.C., they would increase rates for everyone under the age of 35, with a 37 per cent increase for young drivers," a statement from a ministry spokesperson said.

"No driver under the age of 45 would see lower rates according to the report." 

Private insurers have not offered competitive rates in B.C.

"They talk the talk, but when it comes to actually offering cheaper insurance, they don't walk the walk," the ministry said.

And, it went on, in Alberta specifically, some private insurance companies are having to raise their rates by as much as 30 per cent, data MNP itself says wasn't included in the Surrey-Calgary comparisons.

A footnote in the MNP report said the impact of the removal of an insurance cap may not be reflected in the comparisons cited in the examples outlining how much more a driver in Surrey would pay, compared to in Calgary.

The ministry also noted rates are rising in New Brunswick, and Ontario's finance minister says his province has the highest rates in the country – not B.C.

Still, it ceded that it is aware the rates are high.

"We agree that insurance is too expensive here, and we're working hard on finding solutions."