ICBC explores insurance options to reward safe drivers

[Great68]

Would be nice if this change meant I could just hop into the Mustang when I wanted without having to put separate insurance on it.

Somehow I doubt ICBC would let that happen though.

[Gridlock]

Could ICBC go for some real changes? Shit yeah. The whole reason you can't discriminate on people now is because we have no where else to go.

In a private insurance world, if I as a company, don't want to take the risk on young male drivers, I spike the rates and they go elsewhere. So company B says, "I smell opportunity!" and signs up all the young male drivers at a 25% discount off the others' outrageous premiums and signs 'em all up...they can't all crash at once. Right?

We can do all kinds of things with ICBC, but you are limited because of the monopoly.

There are benefits and drawbacks. I don't think, right now, that a drawback to the ICBC system is that people get off an accident scott free. They want you to carry the burden for a longer period of time.

As I said on page 1, which I got failed for by a random that didn't even explain why which kind of irks me, but whatevs...if you get in an accident, do you really need to wear the scarlet letter 10 years later?

I was at fault. I felt like shit. I lost my car. I paid a "premium" in that I didn't go to surcharge, but lost all my discount and it took me about 6 or 7 years to get fully back. Yes, I fully admit that the womans truck that I hit was not at fault, also I'm sure felt like shit and also lost her car, which lead me to feeling even more like shit.

But here's the thing. I think of it as in the past. I have a better discount than I did before...I'm a few steps from road star mofos-then I can hit you for free! I don't get reminded that I'm "Gridlock one crash". Why is that? Because its in the past!

On the subject of personal vs. vehicle insurance

Man, when I first came to BC I did NOT get that system. Why would I, as a company want to have uninsured drivers using my product(ie insurance)? Yeah, the primary driver is paying for insurance on their car, but anyone with a drivers license can use it. Do not get.

And yeah Great68...I can only drive 1 car at a time. Why do I need to insure both of my cars at the same time? I promise you that no one else drives my car but me...mostly because "some people" in my home, that are my girlfriend does not respect my clutch the way I do. Not saying anything, not mentioning names

[gars]

What I wouldn't mind is if I were to get a big discount on a pleasure vehicle when I have a vehicle for commuting already.

My buddy who lives in Texas says he can insure a second vehicle for a few hundred bucks.

[4444]

Originally Posted by falcon

No, because they are a MUCH higher liability on the road. And that is something no one here can try to deny. It's simple fact.

Wow, only 1 person gets it,

First off, nothing to do with jealousy, I have everything I want in life, attained through hard work and continued hard work - a fancy car means little to me, I'd rather invest that $200k and retire sooner, but thats just me

Anyways, it has nothing to do with the cost of a vehicle, but moreso the power of a car, in the hands of a 20 yr old, a 500 Hp car, on average (proven by data) will be in more accidents than a 100 Hp car (and people agree with this just look at the thread on those kids who died this weekend in Richmond)

And for those who think its a joke, this is how it's done in England (not sure on rest of Europe), and the reason I bring it up is to provide absolute prevention to people who buy a car for their kids to drive but insure it in the name of the parents for cheaper insurance - this hurts everyone, and isn't fair to those honest ppl who have paid more for their insurance in a year than their first car was worth when they were 16 or 17

[wing_woo]

Originally Posted by gars

What I wouldn't mind is if I were to get a big discount on a pleasure vehicle when I have a vehicle for commuting already.

My buddy who lives in Texas says he can insure a second vehicle for a few hundred bucks.

Yeah, that would be nice. I have a compact car that I use to go to work and I leave my SUV at home for my wife to use to take care of the kids. The SUV rate even though it's for pleasure comes to the same price as my compact car that is insured to go to and from work. The SUV only gets driven maybe 2 or 3 times a week and still pays the same cost as my daily driver, and that's only cause my SUV has optional insurance with a private insurer instead of ICBC whereas my DD is fully insured through ICBC.

I asked and apparently, you only get big discounts when you own like 5 cars or more.

[Marco911]

I think they should estimate your surcharge/discount based on a linear regression formula and a decay rate to the baseline using the following variables:

1) # of accidents
2) Severity of accident score(1-10). The score is based on the total $ payout for accidents/injuries. i.e. Claim amount $0-$2000 - 1 point ; $2001-$4000 - 2 points
3) Accrued Driver Point Premium (DPP) multiplier. The DPP multiplier only kicks in if you have at-fault accidents.

[TRDood]

Originally Posted by wing_woo

Yeah, that would be nice. I have a compact car that I use to go to work and I leave my SUV at home for my wife to use to take care of the kids. The SUV rate even though it's for pleasure comes to the same price as my compact car that is insured to go to and from work. The SUV only gets driven maybe 2 or 3 times a week and still pays the same cost as my daily driver, and that's only cause my SUV has optional insurance with a private insurer instead of ICBC whereas my DD is fully insured through ICBC.

I asked and apparently, you only get big discounts when you own like 5 cars or more.

When you insure 5 or more vehicles, that could be considered as a fleetplan.

[TRDood]

Originally Posted by Marco911

I think they should estimate your surcharge/discount based on a linear regression formula and a decay rate to the baseline using the following variables:

1) # of accidents
2) Severity of accident score(1-10). The score is based on the total $ payout for accidents/injuries. i.e. Claim amount $0-$2000 - 1 point ; $2001-$4000 - 2 points
3) Accrued Driver Point Premium (DPP) multiplier. The DPP multiplier only kicks in if you have at-fault accidents.

Finally, something useful that ICBC could use for basic insurance rate design. Will thank your post later.

[Raid3n]

there are some states in the us, that insure the person, and so you can move your plates from car a to car b whenever you want... i wonder if that would work up here?

that way you can have your econobox daily, and your garage queen weekend warrior and just move the plate over when you want to take it for a rip.

[RiceIntegraRS]

This is how i see this new system compared to the old system

a. Drivers with 10+ years with no accidents = Pay Less
b. Drivers with 9 years experience with no accidents = Pay Same
c. Drivers with 1 accident no matter how many years driving experience = Pay More
d. Drivers with less than 9 Years driving experience = Pay More
e. Drivers with more than 1 accident = Pay Alot More
f. New Drivers = Pay Alot More

I think most of us land in c, so the majority of the population will be paying more for insurance than before. Thats how i see it

[littledog]

Originally Posted by Gridlock

I get that people that cause accidents should pay more, but damn.

Well, I'm "Pam one crash" probably about 8 years ago. I was a younger driver then. Ever since then, I've become a cautious driver...grandmother like on public streets if you ask my girlfriend. Do I really need to be paying a premium 10 years later? Mr. multiple crashes obviously gets a discount on buying more than one because hey..his multiple at faults only carry a 400 premium over Pam one crash.

I paid my dues on my mistake. I went down to zero discount and earned it back at 5% at a time. I sit here now, and I don't think "gee, 8 years later I'm still a shit driver" I think "8 years later I'm as good as anyone else-as shown in my 41% discount"

Am I missing something here? If you are "Pam" then you are considered as good as a driver as "Joe" and you will be paying the same amount as someone who has never had an accident before.

Joe under old system is paying $825, new system he will pay $675.
Pam under old system is paying $825, new system she will pay $675.
Jerry under old system is paying $825, new system he will pay $1250.

Under the new system, they are only penalizing Jerry here who had multiple at fault accident which is more than fair in my opinion. Joe and Pam are considered safe drivers both under the old and new systems.

[Gridlock]

More, they pay that in addition the reg. Amount.

[Graeme S]

I believe the term "premium" here is being used as the insurance term, and not as the "in addition" term. Which is to say that Joe and Pam are treated differently now but would be treated the same in this hypothetical future.

[jackal]

Originally Posted by Marco911

I think they should estimate your surcharge/discount based on a linear regression formula and a decay rate to the baseline using the following variables:

1) # of accidents
2) Severity of accident score(1-10). The score is based on the total $ payout for accidents/injuries. i.e. Claim amount $0-$2000 - 1 point ; $2001-$4000 - 2 points
3) Accrued Driver Point Premium (DPP) multiplier. The DPP multiplier only kicks in if you have at-fault accidents.

#2 is severely flawed as is won't take into account the value of the vehicle, the number of people involved and their state of health before the accident.

if i fender bender a Ferrari and the driver has a pre existing back problem and his passenger has some other chronic ailment that gets flared up because of a small bump. there is no reason i should have to pay more then the next guy bumping a 1987 corolla with a passenger that ends up with no after affects. one incident may end up with claims well over 10k the other on sub 2k.

[Marco911]

Originally Posted by jackal

#2 is severely flawed as is won't take into account the value of the vehicle, the number of people involved and their state of health before the accident.

if i fender bender a Ferrari and the driver has a pre existing back problem and his passenger has some other chronic ailment that gets flared up because of a small bump. there is no reason i should have to pay more then the next guy bumping a 1987 corolla with a passenger that ends up with no after affects. one incident may end up with claims well over 10k the other on sub 2k.

How is that severely flawed? If you shouldn't have to pay more as a result of your at-fault accident, who should? The rest of us? That's what drives rates up. You paying more = the rest of us paying less. The rest of us had nothing to do with your accident. That seems perfectly fair to me.

[jackal]

Originally Posted by Marco911

How is that severely flawed? If you shouldn't have to pay more as a result of your at-fault accident, who should? The rest of us? That's what drives rates up. You paying more = the rest of us paying less. The rest of us had nothing to do with your accident. That seems perfectly fair to me.

you say that now until you get fucked by your own system then bitch why you can't afford the 15k a year insurance to drive your car around because of some random circumstances where you got shafted. if people really stepped back and looked at the system we have here ie icbc it works really well for the greater population and when you break it down into individual circumstances some benefit and some get screwed. i would greatly benefit from a private system. i'm a road star and have a pleasure vehicle. is i lived in alberta i would pay next to nothing and be able to hop in my sports car when ever and just cruise. instead i have to go buy day insurance or pay to insure a whole other vehicle. BUT when i was 16 and first got my license i didn't get fucked and have to pay 5000 or more for insurance just for being a young male with a fast car. instead icbc used their blanket system and i paid what everyone else pays at the beginning.

the other problem you will run into is the lack of competition. icbc has a monopoly on the market so if they can charge the way you put forth drivers will have no options. in a private system they can shop around and those companies do compete for market share and they do that through price and other things. a lot of people don't really understand just how much extra you pay over time if you don't pay off the damage up front. but it's almost always in the tens of thousands UNLESS your roadstar and get the one free pass.

your basically asking for a private system on a monopolistic market which as i mentioned before will absolutely FUCK some people, and many that don't deserve it due to unforeseen circumstances.

i posted this once before in the police forum but truthfully the solution to better rates is having less accidents and thats done through driver education. what needs to happen is a system needs to go in place where we are required to do a road test every 5 years to go along with our license renewal. now obviously there are hoops to jump through like properly staffing icbc driving centers so you don't have to wait 3 months for a road test and there would probably have to be an added cost for the road test like maybe $50-75 but i can't stress enough how many people are on the road today that would not be able to pass a road test. my parents included, and they need to know what they are doing wrong.

better education and training will lead to better rates.


edit: and just because i re-read your post currently you DO pay more if your in an at fault collision if you choose to not pay the surcharge over the next 6 or 7 years. if we go back to the scenario with the Ferrari and corolla in both cases i will have the option to pay off the damage and then incur no penalty at all. most people don't realize just how much extra they end up paying if you choose not to pay off the damage and take the surcharge. in a lot of cases it adds up to tens of thousands of dollars.


here is a super simple example not using real icbc numbers. say i'm at 0% discount and get into a crash and the surcharge is 2 levels of 10% the next year i would have been at say -5% so on year one i'm paying 25% extra year 2 is another 25% year 3 is 15% year 4 is 15% and so on all the way to road star at 43% in this case i would have paid 183% MORE insurance over the course of me reaching road star and if my insurance is 2k a year that works our to something like 25k over the course of 11 years


and again to reiterate you buy insurance to protect yourself not to get fucked if you ever need it.

and relating all of this back to the OP... if icbc starts segregate people more individually then there will be people getting unfairly treated because of the monopoly they have on the insurance market.

[UFO]

I seem to recall that ICBC has or had a clause where if you claim an at fault accident, and you are at fault claim free for the following 2-3 years, your discount restores itself back to where it was at the time of the original claim.

And paying off your accident is all fine and dandy. But I believe you can only do this if there are no injury claims from the other party. A big reason for this mess are the people who are cashing in on relatively minor car accidents and over claiming injuries.

[Marco911]

Originally Posted by jackal

you say that now until you get fucked by your own system then bitch why you can't afford the 15k a year insurance to drive your car around because of some random circumstances where you got shafted. if people really stepped back and looked at the system we have here ie icbc it works really well for the greater population and when you break it down into individual circumstances some benefit and some get screwed.

I don't think the system works well at all. There's far too much fraudulent injury claims that are driving up rates significantly for everyone. If you look at the data, the number of collisions and severity of collisions are going down. Cars are becoming safer, yet injury claims have skyrocketed. This is where ICBC needs to focus by changing legislation on how injury claims are handled.

I don't think anyone having "soft tissue injuries" like whiplash, which cannot be medically proven to exist should get any personal compensation whatsoever. Medical costs/physio...fine, just no benefit personally. Minor, medically provable injuries should be paid per a fixed compensation schedule depending on the nature of the injury. You should also be able to buy optional coverage to top up compensation available in the schedule for drivers and passengers in your vehicle if you should you so choose. This will keep baseline rates low, but provide people with an option to get higher compensation if they're willing to buy extra coverage up front. Handling these two categories in this manner would also eliminate the deadweight economic costs of needing lawyers involved. It would also prevent poor people from trying to scam the system for a payday.

Long term debilitating injuries can continue to be handled on a case by case basis with legal representation.

your basically asking for a private system on a monopolistic market which as i mentioned before will absolutely FUCK some people, and many that don't deserve it due to unforeseen circumstances.

I don't believe in unforseen circumstances. I believe in personal accountability. The people who crash constantly and raise the rates for everyone else don't deserve to be on the road. They do deserve to get fucked.

i posted this once before in the police forum but truthfully the solution to better rates is having less accidents and thats done through driver education.

I agree. However, there's no incentive to get better driver education unless accidents become really really expensive.

what needs to happen is a system needs to go in place where we are required to do a road test every 5 years to go along with our license renewal. now obviously there are hoops to jump through like properly staffing icbc driving centers so you don't have to wait 3 months for a road test and there would probably have to be an added cost for the road test like maybe $50-75 but i can't stress enough how many people are on the road today that would not be able to pass a road test. my parents included, and they need to know what they are doing wrong.

I don't agree with the road testing every 5 years because you couldn't build the capacity in the system, and it would be a major inconvenience.

I want it to be much harder and more expensive to get a driver's license, like in Europe. I think if you have 3 at fault accidents in a 3 year period, you should also lose your license and have to requalify by getting retested.

and again to reiterate you buy insurance to protect yourself not to get fucked if you ever need it.

The rating system I propose would increase exponentially as a factor of # of accidents and cost of claims. It would be set to be relatively affordable for the 95-98%th percentile of insured The 2-5% that cost the system the most money would have their rates increased to such an extent they are essentially kicked out of the system.

[Rich Sandor]

If seniors get a 25% discount on insurance that is not available to under 65's, than that means it's discrimination against younger drivers. Which is bullshit.

BUT - knowing that both my parents are on a fixed pension which is PEANUTS and they are no longer in a rush to get anywhere, I support the discount for seniors.

My preference would be for ICBC to offer a discount to drivers of ANY age who take advanced driver training courses, such as accredited track days or collision avoidance courses, and have that as a 10-15% overall additional discount to basic liability and collision fees.

[BillyBishop]

Originally Posted by Gridlock

More, they pay that in addition the reg. Amount.

Originally Posted by Graeme S

I believe the term "premium" here is being used as the insurance term, and not as the "in addition" term. Which is to say that Joe and Pam are treated differently now but would be treated the same in this hypothetical future.

What Graeme said makes sense.

I was about to ask why the heck Joe is paying a premium (extra on top of regular) for 25 years of accident free driving.

[Marco911]

Originally Posted by Rich Sandor

If seniors get a 25% discount on insurance that is not available to under 65's, than that means it's discrimination against younger drivers. Which is bullshit.

BUT - knowing that both my parents are on a fixed pension which is PEANUTS and they are no longer in a rush to get anywhere, I support the discount for seniors.

Seniors also drive a lot less. One or two collisions can throw them out of the game because insurance will become unaffordable.

My preference would be for ICBC to offer a discount to drivers of ANY age who take advanced driver training courses, such as accredited track days or collision avoidance courses, and have that as a 10-15% overall additional discount to basic liability and collision fees.

I don't think that's necessary. If such drivers were less prone to crash, this will be proven out in the claims record.

[jackal]

marco i think your basically not understanding the general point of insurance. you buy insurance as protection for these unforeseen accidents. in your world whats the point of having insurance? in your world the driver gets fucked after the crash anyways so why bother paying upfront?

if i buy home insurance and then my home burns down because i forgot to blow out a candle before i went out. do you think i should be paying for the cost to rebuild my house and replace my belongings? i hope not. because that's what insurance is for... and of course the cost to get my home rebuild is spread over millions of other peoples insurance. that's what insurance is...

and relating your injury statement to hockey. do you think concussions in hockey have skyrocketed? even with all the technology in padding and protection now? or maybe it's just injury diagnosis that has improved drastically. not to mention the cost of treatments have skyrocketed.

[Marco911]

Originally Posted by jackal

marco i think your basically not understanding the general point of insurance. you buy insurance as protection for these unforeseen accidents. in your world whats the point of having insurance? in your world the driver gets fucked after the crash anyways so why bother paying upfront?

I understand insurance very well. It's about actuarial risk. Higher risk people should pay more, and lower risk should pay less. You seem to think that insurance rates should be less targeted so the average rate is higher. I think that rates should be more targeted to level of risk.

if i buy home insurance and then my home burns down because i forgot to blow out a candle before i went out. do you think i should be paying for the cost to rebuild my house and replace my belongings? i hope not. because that's what insurance is for... and of course the cost to get my home rebuild is spread over millions of other peoples insurance. that's what insurance is...

Strawman. I never said that the purpose of insurance was to recover all the damages that one causes. In the case of private insurers in the U.S., if you have a bad claims record, you can be dropped. Since ICBC can't drop anyone, the worst drivers (based on claims history), under my proposal will have rates that are so high, it is equivalent to being dropped.

Under the severity of claims scale I proposed, one extremely high claim (10 point scale) accident might increase your rates by a couple of hundred dollars a year. If you have another minor accident, insurance would probably still be affordable, but have another major accident and it'll start to get really expensive because of the multiplier effect.

and relating your injury statement to hockey. do you think concussions in hockey have skyrocketed? even with all the technology in padding and protection now? or maybe it's just injury diagnosis that has improved drastically. not to mention the cost of treatments have skyrocketed.

As I said, medically provable injury. I didn't say they wouldn't get their treatment paid for. I said they wouldn't get personal "compensation."

I don't know about you, but I don't like paying $2800/yr, when I have not made a claim in over 15 years. I don't see why I should have to pay more for insurance if I have a bunch of tickets but have never made an accident claim. I'd rather pay $1200 for baseline rates, and have some other shithead causing the high payouts paying $5-6K / yr or be off the road completely and reduce the risk for everyone else.

If ICBC revamped how they compensate injury claims, there would already be a huge 30% decrease in insurance rates. The fraudsters and the lawyers are costing the rest of us a bundle.

[TRDood]

I looked at their online survey. It seems like their options are more or less stretching the CRS level. Now the max discount is at -43%, getting there as fast as having 9 years of claim free driving experience. Their proposal seems to be stretching out to 25 years.

Isn't that similar to what they did in 2001?

I haven't read Marco and Jackal's arguments fully but one thing for sure ICBC does not (and cannot) for basic is to use vehicle model type to write policies.

[lgman]

Ahh Marco glad you can add here..

since the late 70's icbc has used Rate Class Table to group vehicles and based on their risk factor or #'s they base the premiums. This Table is yearly reviewed and adjusted annually to match the current market and hopefully lower premiums. Later on it was moved to computers This is a very Archaic system along side with the software to assist agents have been more or less the same programming algorithms since the early 90s. Like ANSI terminals with 300 baud modems old. BBS newsgroups yadda yadda...

Common problems that I hear over the counter are:
+Why can't I have 1 plate insure 2 or 3 cars under my name?
+Why can't I cancel my insurance but reuse the plates for my future car?
+Why can't I temporarily stop my insurance and resume after my vacation?
+Why can't I change the principle operator at anytime?
.

the main reason why this and so many other progressive thinkers are getting the wall is simply because the programming won't allow these types of changes in the system. System is simply too old and tired. There has been quite a bit of (web policies) online web based services that are quite fast and encrypted well for rider policies such as: ExUMP or Storage policy. One day it will be 100% web based or the simplicity of things. It's getting there but its sure taking its sweet ass time.