ICBC admits 42 per cent in rate hikes possible, drops insurance for luxury cars ROB

[thumper]

ICBC admits 42 per cent in rate hikes possible for basic auto insurance | Vancouver Sun

VICTORIA – The Insurance Corporation of BC has admitted steep rate hikes for basic auto insurance, compounding to more than 42 per cent, are possible in the next five years if it can’t cut costs and claims.

The disclosure prompted the government to announce Wednesday it would no longer insure high-end luxury vehicles, to reduce the number of costly repairs and relieve pressure on basic rates for ordinary car owners.

ICBC said it could hypothetically have to raise rates 6.4 per cent in 2017, 7.9 per cent in 2018, 9.4 per cent in 2019 and 7.9 per cent in 2020 — all rates that exceed a 4.9 per cent cap that Premier Christy Clark has urged the Crown corporation to hold.

That’s in addition to a 4.9 per cent rate increase for basic auto insurance the corporation wants this year. Transportation Minister Todd Stone called the hypotheticals an “extreme worst case hypothetical situation.”

“I want to reassure the public that these are extreme projections that do not consider the actions the BC government and ICBC are taking to reduce the pressure on rates,” he said.


Stone said one of the first steps will be that ICBC will refuse to insure luxury high-end vehicles worth more than $150,000, because costly repairs to those vehicles are driving up basic rate costs.

Legislation will be passed forcing those car owners to get private insurance, Stone said. Until then, as an interim measure, luxury car owners will have to pay double their ordinary basic insurance and ensure their premiums will fully cover the cost of any repairs.

Stone said the luxury vehicles are six times more costly to fix in a crash than ordinary vehicles, and 30 per cent more high-end cars are on the road in the past three years. Greater Vancouver has the largest concentration of the high-end luxury cars in North America.



ICBC rate forecastsThe increases would represent a rate increase of 31.6 per cent, which is compounded annually to represent 42.2 per cent over five years.

The numbers are contained in a response to the BC Utilities Commission that ICBC had tried to keep secret, out of fear the public would take the figures “out of context.” It lost that fight and released the information Wednesday.

ICBC also painted two other hypothetical scenarios, in which it successfully reduces claims costs and improves investment returns. In that case, rates could increase 5.3 per cent in 2017, and then drop to 4.1 per cent annually for 2018, 2019, and 2020.

A more ambitious scenario also paints the possibility of rates only increasing 3.4 per cent in 2017, 1.9 per cent in 2018, 2.2 per cent in 2019 and 2.6 per cent in 2020.

rshaw@postmedia.com

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[JqC]

Too much money - spend on high end cars and exotics.
Can't drive worth shit.

Goddamn Clais. Now all our rates are going up.

[6o4__boi]

i felt a sudden prickling sensation in my wallet area after reading this

Legislation will be passed forcing those car owners to get private insurance, Stone said. Until then, as an interim measure, luxury car owners will have to pay double their ordinary basic insurance and ensure their premiums will fully cover the cost of any repairs.

Stone said the luxury vehicles are six times more costly to fix in a crash than ordinary vehicles, and 30 per cent more high-end cars are on the road in the past three years. Greater Vancouver has the largest concentration of the high-end luxury cars in North America.

Is my my math out of line to think that fuck that...if it costs six times more to fix a luxury vehicle, then their basic insurance should cost six times as much.
If you can afford a luxury vehicle, you should be able to afford sextuple the insurance that us peasants have to pay.

[Mikoyan]

News1130 is reporting Commercial Vehicles are exempt from the 150k cap. I wondering if getting a commercial tag would allow you to be insured. If it does, that's a giant loophole even a clai could drive through cleanly.

[freakshow]

I don't understand. If high end vehicles cost more to fix, why don't you just charge more to insure them? That's exactly what a private company will do..

[Urrtoast]

They should increase the rate to new drivers and anyone with out 10years safe driving.
If the person is driving under a L or N they should charge them 50 percent more, If the car or truck there driving is valued over 20k they also should pay 50 percent more.
Lets give the safe drivers that have been driving for 8-10 yrs with not issues a discount.
Just think how much revenue Richmond would give to icbc....


IMHO
If you fail this post you are a bad driver and fall into the you should have a surcharge applied to your insurance.Or you live in Richmond..lol

[Edison_Chen]

Originally Posted by Mikoyan

News1130 is reporting Commercial Vehicles are exempt from the 150k cap. I wondering if getting a commercial tag would allow you to be insured. If it does, that's a giant loophole even a clai could drive through cleanly.

I think if its commercial vehicles, it is probably the big semi trucks or the big dump trucks or the big logging trucks.

[pastarocket]

ICBC should raise insurance rates for owners of high end cars in the interim by more than just double.

There's gotta be a way to make a scale of insurance fee brackets a price of a car falls into so that than an owner of a Ferrari, Lambo pays much more in insurance than somebody who drives a Hyundai.

-sort of like a mainlander insurance premium.

Add an insurance premium for N drivers too.

[Urrtoast]

Originally Posted by pastarocket

ICBC should raise insurance rates for owners of high end cars in the interim by more than just double.

There's gotta be a way to make a scale of insurance fee brackets a price of a car falls into so that than an owner of a Ferrari, Lambo pays much more in insurance than somebody who drives a Hyundai.

-sort of like a mainlander insurance premium.

Add an insurance premium for N drivers too.

But someone in the 40-70s that's been a safe driver for 10plus years should not have to pay a premium.
Unlike the 16-29 year olds driving the Ferrari , Lambos, McLaren etc that lack driving experience and responsibility or there daddy bought it for them.

[radioman]

I think ICBC needs new actuaries.

[Hondaracer]

This shit is honestly insane.. like we need some fucking reform ASAP

[Traum]

IMO, the policy announced today could mark a watershed moment in the province's auto insurance industry. As a matter of fact, I can potentially see this as the first step towards converting our public insurance system to a private one, and I do not like that.

With ICBC dropping luxury car customers, the private insurance industry will be asked to pick them up. But what can happen is -- and if I were a private insurance company, I would totally do this -- for one reason or another, the private industry might initially offer unsustainably low rates. It could be a marketing ploy, it could be due to a lack of accurate insurance data, etc. Whatever the reasons might be, if private insurance offers this unsustainably low rate, shortsighted idiots might start crying foul and claim that our current public auto insurance system needs to be scrapped because it is too expensive. With enough outcry, the province gives in, and then we shift to a private system.

Now that everyone is sucked into the private insurance game, those companies can start raping our a$$es and implement dramatic rate hikes.

We see this time and again in all kinds of businesses / marketing promotions. The Shaw 150Mbps plan is $50/month in Year 1, and $80 in Year 2, and then goes back to $135 in Year 3+. My old Shaw 25 plan might be $60/month right now, and if I think that signing up for the new 150 plan will save me $10/month, I am obviously sorely mistaken. But while many can see the longer term total cost increase in this Shaw scenario, very few can foresee a similar thing happening if we were to switch from our public auto insurance system to a private one.

[Hondaracer]

Raping our Asses? I pay $1650 a year for a 16 year old truck with 0 coverage outside of 3M liability..

thats with 44% discount, 10 years safe driving, yadayadayada

my ass is feeling pretty sore as is with ICBC..

[dabbin]

Originally Posted by Traum

IMO, the policy announced today could mark a watershed moment in the province's auto insurance industry. As a matter of fact, I can potentially see this as the first step towards converting our public insurance system to a private one, and I do not like that.

With ICBC dropping luxury car customers, the private insurance industry will be asked to pick them up. But what can happen is -- and if I were a private insurance company, I would totally do this -- for one reason or another, the private industry might initially offer unsustainably low rates. It could be a marketing ploy, it could be due to a lack of accurate insurance data, etc. Whatever the reasons might be, if private insurance offers this unsustainably low rate, shortsighted idiots might start crying foul and claim that our current public auto insurance system needs to be scrapped because it is too expensive. With enough outcry, the province gives in, and then we shift to a private system.

Now that everyone is sucked into the private insurance game, those companies can start raping our a$$es and implement dramatic rate hikes.

No.

ICBC will still insure them for liability, as is required by law.

They will drop the ability to get comprehensive and collision for them, which are the big killers on their costs. There already exists private insurance for this.

Now if they get into an at fault accident in their S class, ICBC will fix the other car, and likely pay out the other driver for medical / pain & suffering (as they still do now.) and their liability rate increases (claim rated scale), BUT, ICBC won't fix the S class, or pay $200k to write it off (unless some poor shmuck runs into one and is at fault, his insurance would cover it, regardless of the car he hit). The repair to the "s class" would be done through a 3rd party private insurance claim and will mean STUPIDLY expensive future insurance for the exotics/luxury driver with, or no comprehensive or collision coverage at all for their 6 figure car.

[flagella]

Originally Posted by Urrtoast

They should increase the rate to new drivers and anyone with out 10years safe driving.
If the person is driving under a L or N they should charge them 50 percent more, If the car or truck there driving is valued over 20k they also should pay 50 percent more.
Lets give the safe drivers that have been driving for 8-10 yrs with not issues a discount.
Just think how much revenue Richmond would give to icbc....


IMHO
If you fail this post you are a bad driver and fall into the you should have a surcharge applied to your insurance.Or you live in Richmond..lol

I fall into neither category and I think your comment is retarded.

[Traum]

Is that your reading of today's announcement, dabbin? Cuz as I read up on the various news report for it, my interpretation is quite different from yours, and that was how I came to my concerns above. From the way I am reading the press announcement, ICBC is entirely getting out of the insurance game for $150k+ vehicles. No optional insurance. No basic coverage. No nothing. They are letting the private sector handle that, and they are preparing the legislations for it.

So if they really get out of the basic insurance game for the $150k cars, that would be a game changer. But if they continue to offer basic liability insurance to them, then it seems like a pretty dumb plan. They should have just up the rates for those $150k+ cars to the point where they (ICBC) can break even, or maybe even make some profit. If the province is only dropping the optional insurance for those $150k+ cars, it is pretty much handing the potential cash cow over to the private insurance sector.

[Mr.Money]

there has to be another public insurance company to under cut and fuck ICBC out of the car game....why is there only One Company to get your car on the road?

[Djiban]

They should have different pools for new, retarded and excellent drivers when setting up the rates.

Is it because they don't adapt with change well? With more rich immigrants coming into the province in the last few years and buying exotic/expensive cars, combined with poor driving skills (especially new drivers with exotics), of course there's a higher probability of accidents.

[whitev70r]

MUST let other insurance companies into the game. This is INSANE!

[Traum]

Originally Posted by Mr.Money

there has to be another public insurance company to under cut and fuck ICBC out of the car game....why is there only One Company to get your car on the road?

You do realize what you're saying, right? Why would there be 2 public insurance companies competing against and trying to undercut each other? The very definition of public insurance means the corporation will be backed by the provincial government, and it just makes no sense that 2 separate government branches will compete against itself.

Originally Posted by whitev70r

MUST let other insurance companies into the game. This is INSANE!

As expected, the discussion goes back to the public vs private insurance debate, and we have gone over that many, many times even on this forum. The core of the issue isn't really whether public or private is better. Rather, it is how any given system is run. Currently, I'd say our ICBC public system is pretty good, even though there are certainly a lot of improvements that can be made.

[underscore]

What I don't get is why ICBC doesn't just adjust the rates on $150k+ cars to where they need to be? That's what I assume any private company will do, otherwise there's no benefit in them taking on customers that ICBC has deemed too costly.

[!Yaminashi]

Originally Posted by underscore

What I don't get is why ICBC doesn't just adjust the rates on $150k+ cars to where they need to be? That's what I assume any private company will do, otherwise there's no benefit in them taking on customers that ICBC has deemed too costly.

Because ICBC is run by retards. Or maybe it's just me that feels that way..

[jackmeister]

shouldn't all insurance rates be reflective of the insured value?

like.. if it costs 6x as much to fix, it costs 6x to insure (all else being equal)?

[Digitalis]

So speaking as a socialist SJW.
If it costs 6 times more to fix a 150K+ vehicle shouldn't we charge them 10 times more so it helps out those that can barely afford to insure their beaters?
I mean c'mon these people can afford 150K+ cars can certainly afford to pay a little extra for insurance.

[Manic!]

A guy with a high end car may only drive 30 times a year where as a guy with a old Civic could be driving it every day. Why should the guy driving only 30 times a year pay way more than the guy driving 365 days a year.