Insurance Corporation of British Columbia announces $100 million in rate reductions to customers purchasing ICBC optional insurance

Bookmark and Share

VANCOUVER, June 21– The Insurance Corporation of British Columbia (ICBC) today announced that more than 1.6 million BC motorists will receive rate reductions totalling $100 million when they renew their optional insurance with ICBC.

The majority of the benefits will be felt by RoadStar customers driving pivate-passenger vehicles. RoadStar customers are policyholders who have not had an at-fault claim in nine years or more.

In addition, motorists who have already renewed their optional insurance with ICBC this year, and who qualify for rate reductions, will receive refunds worth more than $30 million. This will apply to the time period from June 1, 2005 to the end of their policy term.

“Safer driving by BC motorists, combined with increased efficiencies at ICBC, has made these rate reductions possible,” said Minister John Les, Solicitor General and Minister responsible for ICBC. “We promised to allow ICBC to operate free of political interference, and we are now seeing the results — real benefits for drivers across British Columbia.”

More than 300,000 customers will receive rate reductions of $100 or more when they renew their policy, and almost 70,000 customers will see reductions of $200 or more.

“This is good news for our customers who have contributed the most to ICBC’s recent positive claims trends,” said President and CEO Paul Taylor. “We will continue to monitor trends in claims and other factors. If they continue to be positive, we will look at further rewarding our better-risk customers.”

Other provinces have experienced extreme swings in insurance rates over the past several years. During that same period, ICBC has kept rates low and stable by being one of the most efficient insurers in the country.

Statistics Canada figures show that, in recent years, rate increases in the rest of Canada have far outstripped the rate changes experienced in BC.

Commercial vehicles will also see rate changes. Thirty-five per cent of commercial vehicles will see a decrease, while 11 per cent will see an increase. No commercial vehicle will see a premium increase greater than five per cent.

ICBC competes with other insurance companies in offering optional auto insurance, and rates are set independently by ICBC’s Board of Directors. Rates for basic, compulsory insurance are set by the BC Utilities Commission.

ICBC recently announced that it would propose no change to its basic insurance rates for 2006. If approved by BCUC, this would mark three straight years with virtually no change to basic insurance rates.

ICBC also released financial results today for the quarter ended March 31, 2005. Net income for the quarter was $92.5 million, which compares to $81.6 million for the same quarter in 2004. These results are attributed to continued low controllable costs, and strong premium revenue and investment income.

Note: Additional background information can be found at www.icbc.com.