VICTORIA — New Democrats could not have asked for a better starting point from which to reform public auto insurance than the report left behind by the B.C. Liberals.
Late last year, the Liberals commissioned the accounting firm of Ernst and Young (EY) to do an independent review of the growing financial pressures on rates at the Insurance Corp. of B.C.
The findings were returnable within six months, meaning the Liberals expected to be in a position to pick and choose among possible remedies once the election was safely out of the way.
Instead the New Democrats can do the cherry-picking, a process that began Monday with the official release of the 203-page EY report that had already been leaked to The Vancouver Sun last week.
Not surprisingly the cabinet minister for ICBC, Attorney-General David Eby, began his response by taking a swipe at the former government for letting a “grave financial crisis at ICBC fester for at least two years.”
The report, which doesn’t lack for candour about what brought ICBC to the current troubled state of affairs, offers support for the NDP point of view: “Only recent government intervention has protected B.C. drivers from the currently required 15 per cent to 20 per cent price increases. This rate protection has eroded ICBC’s financial situation to a point where it is not sustainable.”
But the New Democrats, having promised to make life more affordable for British Columbians, have no intention of surrendering to the report’s worst-case scenario of a 30 per cent rate increase over the next two years.
Eby also ruled out the two most provocative remedies to emerge from the initial round of speculation about the report: “We are not considering photo radar or moving to a no-fault system for auto insurance.”
That said, he kept his options open on the many other possible remedies arising from the report which is nothing if not comprehensive in that regard.
Some of the proposals “are very compelling,” Eby conceded. Those included “the opportunities around new technologies that will make our roads safer … the red-light cameras are one example.”
Use of the latter is a far more promising route to reining in accidents than the antiquated photo radar system, which used up significant policing resources and invited abuses like posting the detection vans at the bottom of hills.
Some 60 per cent of all road accidents in B.C. happen at intersections, making the use of red-light cameras central to any serious effort to reduce an accident rate that has grown 23 per cent in just three years.
Today’s state-of-the-art cameras are digital, automatic and potentially relentless. But B.C. hasn’t begun to exploit their full capacity. It deploys only 140 of them and operates those only six hours out of every 24. Nor does the province make use of the option of using the cameras to police speeding through intersections as well as the running of red lights.
Eby was more cautious about the passages in the report dealing with one of the biggest factors in soaring costs, namely litigation.
The authors of the report leave no doubt about why B.C. is an outlier among Canadian jurisdictions in that regard: “British Columbia has a litigation-based insurance model, which allows not-at-fault drivers to sue at-fault drivers for both economic loss (lost wages, treatment costs, material damages) and pain and suffering, regardless of severity of injury.
“B.C. is the only province in the country that has not modified this adversarial model. All other Canadian jurisdictions have reformed their insurance schemes over the past 20 years in response to escalating claims costs and concerns regarding affordability.”
Eby said he was more taken with the report’s observations that accident victims have to resort to litigation because ICBC’s fee schedule for initial payouts has not kept up with the rising cost of treatment.
Until that is addressed, he’d be reluctant to put any restrictions on the right to seek remedies in court.
Originally published by Vaughn Palmer at the Vancouver Sun.