Richard Truscott is the Vice-President, B.C. and Alberta, Canadian Federation of Independent Business (Submitted).

COLUMN: ICBC is not just broke, it’s broken

Richard Truscott is B.C. and Alberta vice-president at Canadian Federation of Independent Business

Anyone who runs a business understands that consumers wield tremendous power.

Competition drives the creation of new efficiencies and innovations that enable companies to deliver the best product at the best possible price. Businesses that fail to adapt and change rarely survive.

However, ICBC’s 40-year monopoly on car insurance is a clear exception to this rule. It’s in a financial black hole. As its finances have plummeted, its bureaucracy has grown so much that it now employs twice as many staff as any other Canadian insurer its size.

It’s well documented that the corporation is a financial disaster. While many solutions are being put forward, ICBC’s preferred response is always the same: higher prices or worse benefits. With no competition, there is no pressure to take a hard look at its own operations to find efficiencies and savings. Rather, it continues to push big rate increases on customers as a “solution.”

This year, its basic insurance rates are going up 6.3 per cent. Since 2012, basic insurance premiums have grown a staggering 54 per cent while pleas from British Columbians for other options have been ignored.

Instead of bold leadership, we’re seeing Band-Aid solutions that will result in customers being gouged in the years ahead. In fact, ICBC’s financial filings call for an additional $1.17 billion in price increases over the next three years.

All this from a government-run insurance company that has lost more than $3 billion in the past three years. ICBC is not just broke, it’s clearly broken.

READ MORE: ICBC in ‘financial dumpster fire,’ minister says

Like many residents, business owners are fed up. A survey of independent businesses in B.C. found 75 per cent want ICBC’s monopoly ended. They want a choice in where to buy car insurance, to shop around for their insurance needs – just like the vast majority of other Canadians.

And why wouldn’t they? The Crown corporation is implementing changes on Sept. 1 that will significantly disadvantage businesses. For instance, over the next 10 years, prices for business vehicles will increase by an additional four per cent on top of all of its other increases.

It will also require every driver who may even occasionally use a vehicle to be listed on the owner’s policy. For small businesses, this may be extremely onerous. Business owners will need to provide ICBC with the driver’s licence number and date of birth of each employee, even if they operate a company car as little as once a month. In addition, 25 per cent of prices will then be based on the worst driver listed, regardless of how little that employee uses the vehicle.

As a cherry on top, the insurer is extending the time it takes to receive the full safe-driving discount from nine years to 40. Put another way, anyone who is 16 years old today will have to wait until they are 56 to receive the full claims-free discount.

ICBC says all of its changes coming next week are “revenue neutral” in the first year. That begs the obvious question: What kind of rate hikes will year two bring?

Businesses cannot afford the ICBC price increases. Or, more simply, they cannot afford the ICBC monopoly. Now, more than ever, it’s time to allow choice in B.C.’s vehicle insurance market.

Richard Truscott is the B.C. and Alberta vice-president at the Canadian Federation of Independent Business

Like us on Facebook and follow us on Twitter

Just Posted

Battling bullying covers a lot of ground, says Island Safe Schools manager

Social media responsible for a lot of the problems being seen in schools, Sooke official says

Wounded Warrior Run gets personal for participant

Port Alberni RCMP officer says mental health is a priority

Editorial: End vicious cycle of bullying

Pink Shirt Day began 13 years ago, but the anti-bullying message is still relevant today

CatVideoFest makes its way back to Victoria

A curation of favourite cat videos will be featured on the big screen, all to support cats

Michelle Obama: In Conversation in Victoria, March 31

Former First Lady hosted by Victoria Chamber for moderated event at Save-On-Foods Memorial Centre

Kingfisher spa now open following early January fire

Owner Bill Brandes offered personal funds to minimize the impact of the situation on his employees.

Off-leash dogs could be a thing of the past on Saanich beaches

‘This isn’t about loving or hating dogs, it’s about finding the right balance’ councillor says

Cowichan Valley Regional District requests rainstorm, flood photos via online tool

Officials want to know more about how that type of event impacted the region as a whole.

UPDATE: Two killed in fiery collision on Highway 1 near Revelstoke

The Trans Canada Highway was closed for four hours

Father, two children killed after car goes over embankment on B.C. highway

The single vehicle crash occured near Kamloops on Highway 5A

Trout ‘doing quite well’ at Kootenay hatchery after otters, who ate 150 fish, relocated

River otters had been pillaging a moat outside the facility for months, gobbling up about 150 trout

Most Read