Province requesting freeze to basic ICBC rates for 2 years

B.C.'s public auto insurer is asking to freeze basic insurance rates for the next two years, Premier David Eby announced Monday, despite being on track to lose hundreds of millions of dollars this budget year.

ICBC has requested no increases over that period through the B.C. Utilities Commission, the independent regulator responsible for approving rates for utilities and public auto insurance.

"This will help keep insurance affordable for British Columbians at a time when people are facing significant cost pressures," Eby added.

Mike Farnworth, the minister responsible for ICBC, said the freeze means the rates are as low as they were in 2014, and that if BCUC approves the move, there will have been no rate increase for five years.

After years of losses at the Crown corporation, the NDP government made sweeping changes, moving to a no-fault system.

According the province's second quarterly report issued in November, ICBC is expecting a loss this year of $298 million – $625 million lower than projected at the beginning of the year.

Nicolas Jimenez, president and CEO of ICBC, said the insurer could afford the rate freeze.

"The core of the business is doing well," said Jimenez.

He added that rates are about what's expected in the future, and aren't necessarily a reflection of what's happened in the past.

Jimenez was asked several times how ICBC would deal with unexpected issues like severe weather, or global forces that may not be predictable.

"You have an investment portfolio that allows you to set aside money for claims you’re going to pay in the future," he said. "Built into that, we have money that's just aside in case of some unforeseen or unexpected loss."

MOTIVATED BY POLITICS?

Opposition Liberal leader Kevin Falcon told CTV News the decision didn't make sense and reeked of deception.

He pointed out ICBC is supposed to put in an application to the BCUC, along with its business case. Instead, Eby led the "good news" announcement.

"I want people to get a break too," Falcon said. "What I see is an organization on track to lose a quarter of a billion dollars, while their administrative costs have gone up 25 per cent and the payouts they're making to people are down 30 per cent. That is not a good trend."

The news comes on the day a new poll suggests many people are unhappy with how the NDP government is handling key issues, including affordability.

Shachi Kurl, president of the Angus Reid Institute, said the pressure was increasing on the government and Eby to deliver results.

A new poll from the firm suggests seven out of every 10 people surveyed think the government is doing a poor or very poor job of addressing a cost of living crisis.

"That honeymoon period is over," explained Kurl. "They can't just blame it on previous governments, (saying) we were saddled with bad policies or this is the result of other people's decisions."

Asked if the government was doing enough to address cost of living, Eby responded he didn't think the public expected the province to "fix the problem of global inflation."

"But they do expect that we're going to take the steps to support them wherever we can in everyday life," Eby added.

It is now up to BCUC to approve the rate freeze. If it doesn't, Eby said cabinet would review that decision, because affordability is a big concern for his government – suggesting the independent agency's decision would be overridden. That's something, in opposition, the NDP criticized previous Liberal governments for.

The Angus Reid poll surveyed 658 adults in British Columbia from Nov. 28 to Dec. 3, 2022. The survey done online, would have a margin of error of plus or minus four percentage points, 19 times out of 20.