In September, ICBC introduced a new insurance rating model to create a fairer system that better aligns the price of insurance with a driver’s level of risk.
As part of the change, customers are required to list all the regular drivers of their vehicle, including all household members and employees (regardless of the number of days they drive) and any other individuals who will drive the vehicle 12 or more days in a calendar year.
Customers are required to do this when purchasing insurance so that their premium accurately reflects the combined risk of all drivers, and that all customers are paying their fair share for insurance.
In the event a person who regularly drives the vehicle but isn’t listed on the policy causes a crash, the customer can face an additional one-time financial charge, called the Unlisted Driver Accident Premium (UDAP). This financial charge was put in place in order to reduce fraud in the system and better ensure customers don’t choose intentionally to avoid listing higher-risk drivers on their policy.
The amount of the UDAP varies – it’s calculated by looking at how much the customer’s premiums would have been, had the driver who caused the crash been listed as required. The difference is multiplied by 15 for both Basic and Optional insurance, up to a maximum of $5,000 for Basic and to a maximum of two times the total Optional premium.
Since the introduction of the changes, approximately 444 customers are facing this additional charge due to crashes caused by an unlisted driver. The average additional charge amount is about $2,971. All funds collected from UDAP go directly to lowering premiums for all other drivers.
However, recognizing that this new model is an adjustment for British Columbians, ICBC is waiving the Optional portion of this charge for crashes that happen before September 1, 2020.
To illustrate the impact of the changes, the following is an actual customer example:
Description: Married couple, in their 50’s, living together in Metro Vancouver. One person has no crashes, and the other has caused three at-fault crashes in 2018. The one who has caused three previous crashes isn’t listed on the policy but drives the car anyway and causes a crash this year.
What they paid for their insurance: $2,800/year
What they should have paid if both people were listed properly: $3,900/year, a difference of $1,100/year.
Unlisted Driver Accident Premium (UDAP):
Optional portion waived by ICBC: $3,140
Adjusted total: $5,000
For more information on listing drivers on your insurance policy, about Unlisted Driver Protection, and applicable requirements and exceptions, visit https://www.icbc.com/insurance/costs/drivers-experience-crash-history/Pages/default.aspx.