ICBC is moving to a no-fault insurance system which, according to government, should reduce premiums by 20 per cent.
Legislation will be introduced in the coming weeks. At the same time, maximum care and treatment benefits for anyone injured in a crash will increase to at least $7.5 million, and new benefits will provide care for those most seriously injured, for as long as they need it. These benefits will be available to every British Columbian without having to hire a lawyer.
“You shouldn’t need a lawyer to access the benefits you’ve paid for,” said Attorney General David Eby in a news release. “By removing expensive lawyers and legal fees from the system, we are making ICBC work for British Columbians again with more affordable insurance rates and much better coverage, so anyone injured in a crash gets the care they need.”
These changes will be achieved by removing the majority of legal fees and other costs associated with the current litigation-based system, according to government. The new system is forecast to remove more than $1.5 billion in the first full year, savings that will be passed on to ICBC customers through lowered insurance rates.
The Trial Lawyers Association of British Columbia says they are “deeply disappointed” by the move to a no-fault system.
“In the spring of 2019, the provincial government introduced legislative changes, including what it promised the public was a ‘minor’ injury cap,” said said John Rice, association president. “In fact, the cap included brain injuries, depression, PTSD, chronic pain and many other serious injuries. Nine months into this new law, government is announcing the injury cap policy has failed. This is a broken promise to British Columbians, a failed policy, and now a deliberate taking away of the right of British Columbians to receive fair access to courts and fair settlement for those injured on our roads. Today, this government is doubling down on its failed policy to take away the legal rights of British Columbians while protecting ICBC management who have gotten us into this mess in the first place. This move will reward bad drivers and will reduce the ability for injured and vulnerable British Columbians to receive a fair settlement when injured.”
The planned legislation will require ICBC, by law, to assist every person who makes a claim and endeavour to ensure they receive all of the care and benefits to which they are entitled. Customers who still have complaints or disputes about their claim, benefit payments or fairness issues will not need a lawyer to have them resolved. They will have recourse through:
* the Civil Resolution Tribunal, which is independent of ICBC;
* the B.C. ombudsperson; and
* the upcoming ICBC fairness officer, who will be appointed by government to ensure greater independence from ICBC.
As ICBC transitions to this new model, government’s previous work to improve the finances at ICBC means there will be no basic rate change this year. Without significant changes, rates would need to continue to rise by about 35 per cent over the next five years, according to the government.
Highlights of Enhanced Care coverage:
Government will introduce legislation to create the new care-based system, which would take effect on May 1, 2021, so that British Columbians will benefit from:
- average savings of $400 on their premium, compared with the previous full-year policy;
- care and treatment benefits that are 24 times higher than today, up to at least $7.5 million;
- wage loss coverage that is 60% higher than today; and
- new benefits – such as benefits for full-time students, caregivers, those working in the family business or those approaching retirement, who suffer income loss following a crash – replacing lump-sum payments that were previously awarded only through lengthy and expensive litigation.
Similar care-based insurance systems exist in Manitoba and Saskatchewan. Those systems have kept rate changes steady, near zero per cent.
Under Enhanced Care coverage, a driver who is responsible for a crash will continue to be found at fault. This will remain a primary factor in what drivers pay for their insurance. If a driver causes a crash, their premiums will go up.
Those injured by dangerous drivers convicted of certain Criminal Code offences, such as impaired driving, will still be able to sue for additional compensation.