The province announced the first round in promised reforms to ICBC on Tuesday morning.
Last week, the insurance company posted a $935-million loss in the first nine months of the 2017/18 fiscal year and a projected $1.3-billion loss by the end of the fiscal year.
Attorney General David Eby announced that pain and suffering awards for minor injuries will be limited to $5,500. The cost of those types of claims has increased significantly over the years, going from $5,004 in 2000 and $16,499 in 2016.
“British Columbia is the last province in Canada to take this kind of action,” he said.
Additionally, the attorney general said for the first time in 25 years ICBC will make improvements to accident benefits, increasing the care available for anyone injured in a crash, regardless of who was at fault. The overall allowance for medical care and recovery costs will be doubled to $300,000.
A move that was applauded by those advocating for the disabled.
“Disability Alliance B.C. has been advocating for improvements to accident benefits for 12 years,” said Jane Dyson, the organization’s executive director, calling the move a significant improvement.
“We welcome these long-overdue changes that will mean that people who are catastrophically injured in motor vehicle accidents have better supports available to help them rebuild their lives.”
The changes also include: coverage of a greater variety of treatments, more money for treatments, an increase in wage loss payouts from $300 a week to $740 a week, doubling home support benefits to $280 a week, increasing funeral cost coverage to $7,500 and death benefits to $30,000.
As well, in an effort to reduce legal costs and speed up the time it takes to settle claims, the government will institute a dispute resolution process for certain types of claims. Eby said that disputes over certain injury claims, including the classification of an injury, will be heard by the province’s Civil Resolution Tribunal, an independent body that already adjudicates small claims and strata disputes.
These reforms will require legislative changes, which will be introduced in Victoria in the spring, Eby said, and will take effect April 1, 2019. The increase to accident benefits will be retroactive to Jan. 1, 2018.
The changes, he added, will amount to a projected $1-billion decrease in ICBC’s annual claims costs, even with the increase in accident benefits, by reducing the insurance company’s legal fees and expenses.
Legal costs represent 24 per cent of the total cost of a claim. Overall, legal and operating expenses represent 42 per cent of ICBC’s operating expenses with payments to claimants making up the other 58 per cent.
“These changes make the injured customer our top priority, by directing payments away from legal costs into significantly enhancing the care and treatments for anyone who is injured in a crash,” Joy MacPhail, chair of ICBC’s board of directors, and former NDP MLA, said in a press release.
B.C. Green Party leader Andrew Weaver said he is encouraged by the announcement.
“These changes mean that a larger share of our public insurance funds will go directly towards helping British Columbians who suffer accidents recover from their injuries,” he said in a statement.
“A successful, affordable public insurance system requires government to act in the best interests of the people who participate in it,” he said.
In addition to the reforms announced Feb. 6, Eby said that the insurance company will be consulting with customers on major revisions to the rate structure. He said the goal will be to make bad drivers pay more and giving good drivers a break.
Eby also touched on current initiatives under way to increase safety on B.C. roads including 24-hour activation of red light cameras, projects aimed at deterring people from talking and texting while behind the wheel, increases fines for drivers with multiple distracted driving tickets and making improvements to dangerous, high-crash intersections.
@JessicaEKerr
