Yellow vests could be a big seller in B.C. in 2019 when ICBC hits drivers with 6.3% auto insurance premium hike.
The Crown auto insurer has so badly mismanaged its finances that it is expecting a $890 million loss this year, and therefore seeks 6.3% to basic auto insurance rates in 2019.
The Crown corporation planned to submit a rate hike application today with the BC Utilities Commission (BCUC).
The NDP government has vowed to take a hands-off approach to BCUC decisions, so if the commission approves the rate hike, the government may find it difficult to overturn the decision.
Responding to the planned ICBC rate hikes, Attorney General David Eby blamed the previous Liberal government for policies that helped put ICBC in its current financial mess.
"Today, British Columbian drivers are again faced with the reality of the financial crisis at ICBC left by the previous government,” he said. “This situation was so dire that, had our government not moved to stop the bleeding, the announcement today would have been almost a 40% increase.”
He referred to the $1.3 billion shortfall that ICBC faced last year, which taxpayers covered when the government wrote down ICBC’s deficit.
While it is true that ICBC’s financial troubles began entirely under the previous Liberal government, current governments tend to take the heat for tax hikes and rate shocks – something that has triggered major riots in France, where drivers wearing yellow vests have taken to the streets to protest high gasoline taxes and the high cost of living in general.
The provincial government has implemented a number of reforms aimed at addressing longer-term cost issues with ICBC. But it may take a few years before those reforms put ICBC back on sound financial footing.
The latest rate hike application has prompted the Canadian Taxpayers Federation to renew its call for privatization of auto insurance in B.C.
“It’s absolutely unfair that beleaguered B.C. drivers are getting hit with the news that their car insurance rates are getting jacked up yet again and it’s well past time for change,” said Kris Sims, the federation’s B.C. director. “B.C. drivers are being taken for a ride by this outdated, expensive, inefficient, government-forced monopoly.
“If ICBC wants to hike rates again, B.C. drivers should have the right to take their business somewhere else.”