Richard Truscott is the Vice-President, B.C. and Alberta, Canadian Federation of Independent Business (Submitted).

COLUMN: ICBC is not just broke, it’s broken

Richard Truscott is B.C. and Alberta vice-president at Canadian Federation of Independent Business

Anyone who runs a business understands that consumers wield tremendous power.

Competition drives the creation of new efficiencies and innovations that enable companies to deliver the best product at the best possible price. Businesses that fail to adapt and change rarely survive.

However, ICBC’s 40-year monopoly on car insurance is a clear exception to this rule. It’s in a financial black hole. As its finances have plummeted, its bureaucracy has grown so much that it now employs twice as many staff as any other Canadian insurer its size.

It’s well documented that the corporation is a financial disaster. While many solutions are being put forward, ICBC’s preferred response is always the same: higher prices or worse benefits. With no competition, there is no pressure to take a hard look at its own operations to find efficiencies and savings. Rather, it continues to push big rate increases on customers as a “solution.”

This year, its basic insurance rates are going up 6.3 per cent. Since 2012, basic insurance premiums have grown a staggering 54 per cent while pleas from British Columbians for other options have been ignored.

Instead of bold leadership, we’re seeing Band-Aid solutions that will result in customers being gouged in the years ahead. In fact, ICBC’s financial filings call for an additional $1.17 billion in price increases over the next three years.

All this from a government-run insurance company that has lost more than $3 billion in the past three years. ICBC is not just broke, it’s clearly broken.

READ MORE: ICBC in ‘financial dumpster fire,’ minister says

Like many residents, business owners are fed up. A survey of independent businesses in B.C. found 75 per cent want ICBC’s monopoly ended. They want a choice in where to buy car insurance, to shop around for their insurance needs – just like the vast majority of other Canadians.

And why wouldn’t they? The Crown corporation is implementing changes on Sept. 1 that will significantly disadvantage businesses. For instance, over the next 10 years, prices for business vehicles will increase by an additional four per cent on top of all of its other increases.

It will also require every driver who may even occasionally use a vehicle to be listed on the owner’s policy. For small businesses, this may be extremely onerous. Business owners will need to provide ICBC with the driver’s licence number and date of birth of each employee, even if they operate a company car as little as once a month. In addition, 25 per cent of prices will then be based on the worst driver listed, regardless of how little that employee uses the vehicle.

As a cherry on top, the insurer is extending the time it takes to receive the full safe-driving discount from nine years to 40. Put another way, anyone who is 16 years old today will have to wait until they are 56 to receive the full claims-free discount.

ICBC says all of its changes coming next week are “revenue neutral” in the first year. That begs the obvious question: What kind of rate hikes will year two bring?

Businesses cannot afford the ICBC price increases. Or, more simply, they cannot afford the ICBC monopoly. Now, more than ever, it’s time to allow choice in B.C.’s vehicle insurance market.

Richard Truscott is the B.C. and Alberta vice-president at the Canadian Federation of Independent Business

Like us on Facebook and follow us on Twitter

Just Posted

CRIMESTOPPERS: Williams Lake RCMP seek public’s assistance

Williams Lake RCMP released three names of people they are looking for

CRD board on the road travels to Tatla Lake

Broadband, plastics, cycling, grants for assistance and economic development were on the agenda

How closely are you following the federal election?

The weekly web poll for the 100 Mile Free Press

Treasure in Lone Butte: woman discovers time capsule while metal-detecting

A White Rock woman is eager to complete a South Cariboo treasure hunt from 2002

Three local schools see registration numbers drop for 2019-2020 school year

Despite some local schools experiencing a registration drop, others saw their student body increase

VIDEO: Liberals make child care pledge, Greens unveil platform on Day 6 of campaign

Green party leader Elizabeth May unveils her party’s platform in Toronto

Winnipeg student, killed in bus crash, remembered as passionate, kind

University of Victoria student Emma Machado, 18, was killed in the bus crash near Bamfield on Friday

Boy overdosed on illicit anti-anxiety drug found on Kelowna classroom floor, RCMP say

Noah Mills, 8, ingested a pink powdery substance off his Kelowna classroom floor

Fewer trees, higher costs blamed for devastating downturn in B.C. forestry

Largest driving factor is the province’s complex stumpage system that results in high fees, expert says

20 day search for missing Labradoodle in Princeton, B.C. ends with tears of joy

The search brought out bloodhounds, and groups hoping to find Mordy

Canucks sign Brock Boeser to three-year, US$17.6-million deal

Young sniper will be in Vancouver Tuesday

B.C. forest industry looks to a high-technology future

Restructuring similar to Europe 15 years ago, executive says

RCMP conclude investigation into 2017 Elephant Hill wildfire

Files have been turned over to BC Prosecution Service

Most Read