Province looks to freeze ICBC base rate for two years
Posted December 12, 2022 10:28 am.
Last Updated December 12, 2022 1:23 pm.
B.C. Premier David Eby says the government has filed an application with the B.C. Utilities Commission “for no increase to basic insurance rates” over the next couple of years.
If approved, Eby says the move will make “insurance affordable for British Columbians at a time when people are facing significant cost pressures.”
Eby says the rate freeze will mean five consecutive years of no increases to the base rates, while also handing out some of the highest rebates in the country.
“I believe that B.C. should be a place where everyone can build a good life, where you can afford a decent home and quality childcare, and all of your other bills,” Eby said. “Keeping costs down for people [is the] key to building a stronger, better British Columbia for everybody. Holding firm on ICBC basic rates is one way that we’re doing that.”
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Public Safety Minister Mike Farnworth says if the BCUC approves the freeze, drivers in the province will have some of the lowest insurance rates in the country.
“The government has directed that ICBC basic rate application cover two years instead of a standard one year, helping to provide predictability on these basic insurance rates to at least 2025,” Farnworth said.
The announcement comes as the public insurer is expected to record a loss of $290 million this year, with a total loss of more than $650 million in the last four months.
In support of ICBC’s basic insurance rate application, the government has provided direction to BCUC to ensure ICBC builds sufficient capital reserves, which paves the way for a two-year rate filing.
“If you go back to our Q2 report, you will see that the business itself made $117 million in the quarter. So, you have to kind of separate how is the business running versus how are the investment markets treating our $20 billion investment portfolio,” ICBC CEO Nicolas Jimenez said. “There will be moments where we make more money than we planned in the investment portfolio and you would have seen that in the last two years. There’ll be moments where the investment markets have an impact on the value of that portfolio and accounting rules require us to reflect that on our financial statements. That is very separate and apart from that is how the business is doing and the core of the business is doing well.”
