ICBC keeps its commitment to low and stable rates

Bookmark and Share

January 21, 2005, Vancouver – The BC Utilities Commission has released its decision on the application submitted by ICBC in July 2004. The application did not include a request for adjustments to basic auto insurance rates.

“Basic auto insurance rates will not increase in 2005,” said Paul Taylor, ICBC’s president and CEO, “which is good news for our customers.”

Rates for optional coverage, which are not regulated by the BCUC, have also not increased since 2003.

“The BCUC has endorsed ICBC’s investments in road safety as a means to keep rates low and stable for our customers,” said Taylor. The decision also included direction on measurement and approaches for these programs. In each of the past three years, ICBC invested approximately $40 million in road safety and loss management awareness and prevention programs.

A key focus of the decision is on ICBC’s overall financial allocation methodology – that is, how ICBC divides the costs and revenues of its basic and optional insurance products. According to the Commission, good progress has been made and further steps have been identified, including a public workshop in the near future to review certain details of the allocation which will lead to finalizing the methodology.

Based on the Commission’s decisions, ICBC will also prepare a capital management plan and submit the plan to the BCUC for review, and file a comprehensive revenue requirement application as directed by the Commission.

The BCUC was appointed in 2003 as the regulator of basic auto insurance and ICBC’s rates and service levels for basic coverage are now subject to review in an independent and transparent process.

Details of ICBC’s July application, along with the BCUC decision, are available at www.icbc.com (see BCUC).