Gov’t Plans to Strip Rights for Insurance Company Profits; ICBC Targeting Psychological Injury

Today’s guest post comes from B.C. injury claims lawyer Erik Magraken

The BC Government held a press conference where widespread changes targeting the rights of British Columbians to save ICBC money were announced.

In short the Government is creating an artificial cap on what they call ‘minor’ injuries.  As previously discussed even ICBC admits that the termminor injury catches injuries that are ‘complex and costly’.  The pain and suffering cap will be set at $5,500 and is set to kick in in April 2019.

The Government did not provide a full definition of what they call ‘minor’ but ICBC is already noting that in addition to soft tissue injuries that can disable you for up to a year the cap will also target psychological injuries with the insurer publishing a press release saying mental health issues such as ‘anxiety‘ will be caught by the cap.

The Government stated that “a medical professional” will decide if your injury is “minor“.  It is unclear exactly who this medical professional will be.  If you wish to dispute this designation the government is limiting your rights here as well.  The press release notes that certain ICBC claims will be forced to be adjudicated, not by the courts, but by the BC Civil Resolution Tribunal.  Disputes over “the classification of an injury” will be funneled this way.

As of now this Tribunal does not allow people to be represented by lawyers with s. 20 of the law creating the tribunal stating that the default position for hearings is that “the parties are to represent themselves“.

Lastly, if you wish to not have your rights stripped by caps the Government is asking that the victim of bad drivers, not the bad drivers themselves, pay more stating that “Drivers will have an option to purchase additional coverage for a higher limit in pain and suffering compensation. The limit will be set at $75,000 and will cost approximately $1,300 a year, on top of the cost of their basic and other optional insurance. Charging for this optional coverage means the customers who stand to benefit from increased coverage will pay for it, rather than every B.C. driver.

You read that right – if you don’t want your rights stripped you need to pay $1,300 more per year, not the distracted and impaired drivers on our roads!

As Yogi Berra said, It Ain’t Over Till It’s Over!  If the above strikes you as unfair please  contact your MLA and tell the government plainly and clearly ‘no to caps’.

 

Figures show lowest fatal accident numbers in Saskatchewan in decades

REGINA _ Preliminary figures show that in 2017 Saskatchewan recorded its lowest traffic fatality numbers since the 1950s.

Saskatchewan Government Insurance says in a release that there were 102 deaths last year compared with 125 in 2016.

SGI says the last time Saskatchewan recorded fewer traffic deaths was in 1954, when 74 people were killed at a time when there were less than one-third the number of registered vehicles in the province as there are today.

An all-time high was reached in 1974 when 306 people died, but the Crown insurer says fatalities have been gradually decreasing after peaking in the 1960s and 1970s.

The yearly average in the decade from 2007 to 2016 was 145, but when the numbers spiked to 183 in 2012, a special committee was formed that recommended a number of initiatives and new legislation to improve traffic safety.

SGI says impaired and distracted driving, speed and lack of a seatbelt or occupant restraint remain the top contributing factors in vehicle deaths.

Get the facts on #InsuranceInnovatiON

Read more

Road Safety: Make the Right Choices

We just renewed the insurance on our car. It cost us $764 for basic insurance coverage on our 2013 Honda CR-V. I can hardly wait for next year to see what we will be paying to make up for this year’s $935 million ICBC loss.

I usually stay away from politics but the temptation for me is just too much this time. Our Attorney General has likened actions by the previous Liberal government to a financial dumpster fire. We can hear him screaming loudly now, but what about way back when this was happening? Isn’t the job of the opposition to oppose in real time, not after the fact?

Sober second thought is supposed to prevent the government from making mistakes not shout about what should have been done after it has happened.

Meanwhile, the numbers continue to rise. Today’s estimate extrapolated from the five year average includes 24 fatalities, 5.310 injured, 612 hospitalized and 27,014 reported collisions. Part of the problem, perhaps even the majority of it, appears to be that we tend to collide with things when we drive.

One suggested solution put forward is to cap insurance payouts by moving to a no fault scheme. As always, there are views for and against this. Your view may simply depend on whether you are the person paying the premiums or the person receiving the benefits.

Having spent a career writing traffic tickets, I feel bound to try to follow the rules faithfully when I drive. I’ve said it before and I’ll say it again, I make mistakes. We all do, even when we try our best. That’s just being human.

However, there’s a big difference between making mistakes and deliberately doing whatever you please. Keep to the speed limit and you will eventually see something like this:

BC Licence Plates 713TVM and DV949G

These two selfish drivers just couldn’t wait so the rules were something to disregard for their convenience. Depending on your point of view, they are either someone who deserves a violation ticket and the larger share of paying for insurance costs or someone who is practicing civil disobedience because the speed limit has not been set high enough.

We all balance our behaviours based on what we think it’s going to cost us in terms of risk. This situation is just one of many examples that occur on our highways with increasing frequency. The police weren’t around, complaints fall on deaf ears and nothing bad happened anyway. Why worry?

Perhaps I take this too much to heart. I don’t mind paying for vehicle insurance to cover the results of human error. I do mind paying for the deliberate disregard for others.

Does our current insurance scheme make it just too easy for drivers like these to do what they want when they want knowing that if they mess up we’ll all share the burden with them?

To some extent, we’ve made life difficult for drivers who drive while impaired, don’t hold a valid driver’s licence, participate in races or try to run from law enforcement. If a crash is the result of their choices, they’re insurance doesn’t cover them and ICBC takes action to recover what is paid out to others that suffer damages.

Should we extend this to other deliberate unlawful actions? Will the threat of significant financial penalty moderate making the wrong choice for fun or convenience?

Just how do you motivate drivers to try and make the right choices in all circumstances in an effort to reduce insurance costs?

Links:

B.C. to introduce auto insurance pay out limits in 2019 to save $1B annually

By Dirk Meissner

THE CANADIAN PRESS

VICTORIA _ Allowing people to sue for pain and suffering in car accidents has been viewed as a fundamental principle in British Columbia, but that changed Tuesday when the government joined Canada’s other provinces in limiting payouts to some crash victims because of a financial crisis at the public insurance corporation.

Attorney General David Eby said a payment cap of $5,500 for pain and suffering on minor injury claims is a necessary component of the NDP government’s plan to bring back financial stability to the Insurance Corporation of British Columbia, which faces a projected net loss of $1.3 billion this year.

The changes will save up to $1 billion annually, Eby estimated.

Eby would not comment directly on the possibility of further premium hikes this year after an increase of 6.5 per cent last year.

“It’s going to take some time to turn around the problems with ICBC,” Eby said at a news conference. “I acknowledge there is no silver bullet that will solve things immediately in terms of a problem that’s been building for years, unaddressed.”

Eby said the limit on minor injury claims would not take effect until April 2019 as part of legislation to be introduced by the government.

Without the NDP’s plan, Eby said drivers could face average increases in their premiums of $400 or more a year.

The cost of minor injury claims is placing the largest strain on insurance rates, Eby said, with payouts hitting a record $2.7 billion in 2016, an increase of 80 per cent since 2009. Eby said payouts for minor injury claims have increased by 265 per cent since 2000.

“B.C. is the last province in Canada to take this kind of action,” said Eby.

He said the legislation will propose a definition for minor injury that would include sprains, strains, mild whiplash, cuts, bruises and anxiety and stress after a crash. It will not include broken bones and brain injuries, including concussions, or other more serious impairments.

Eby said the average claim for minor injuries is just over $30,000, with pain and suffering payouts averaging $16,500.

A new tribunal will be introduced by April 1, 2019, to resolve injury claim disputes within 60 and 90 days, he said. The current time for an average legal claim handled through the corporation is 30 months.

He said the government will double the medical care and recovery cost allowance available to accident victims to $300,000, regardless of fault. Eby said the change, which is the first increase in 25 years, is retroactive to Jan. 1, 2018.

Liberal Leader Andrew Wilkinson said Eby’s proposals do not lower premiums for drivers or improve compensation for accident victims.

“The option is, of course, to have a wholesale re-examination of ICBC,” he said. “It’s time to re-examine the whole thing.”

The corporation is a state-run model created 44 years ago by the NDP, Wilkinson said.

Eby said he will announce a program to review insurance rates based on driver records within weeks. He did not say when motorists can expect changes.

“The system is disconnected from driver behaviour,” he said. “We want to fix that. We want to reconnect driver behaviour with the rates they pay.”

IBC applauds BC’s move to curb rising auto insurance costs

On behalf of Canada’s private auto insurers, Insurance Bureau of Canada (IBC) welcomes today’s announcement that the British Columbia (BC) government will double accident benefits and introduce a cap on awards for minor injuries following auto accidents.

This announcement follows BC Attorney General David Eby’s earlier statements detailing the financial challenges facing the Insurance Corporation of British Columbia (ICBC) and the significant increase in legal costs in BC’s auto insurance system. BC is the last province to introduce measures to limit awards for soft-tissue injuries. Its accident benefits have not been increased since 1991, limiting the ability of injured parties to access the care they need.

“A minor injury cap has been used effectively in other Canadian provinces to help control costs and limit the rate pressures facing drivers,” said Aaron Sutherland, Vice-President, Pacific, IBC. “But caps alone will not reduce rates in BC. Opening ICBC to competition and allowing Canada’s private insurers to bring choice to the market would bring significant savings to BC drivers, and must be part of any long-term solution to the challenges in BC’s auto insurance system.

“An MNP report released last week showed that opening ICBC to competition would save BC drivers up to $325 every year,” continued Sutherland. “Drivers pay more for their auto insurance in BC than anywhere else in Canada. The experience and innovative tools Canada’s private insurers have brought to other Canadian provinces can help improve the affordability of auto insurance in BC.”

Additional Resources

About Insurance Bureau of Canada
Insurance Bureau of Canada (IBC) is the national industry association representing Canada’s private home, auto and business insurers. Its member companies make up 90% of the property and casualty (P&C) insurance market in Canada. For more than 50 years, IBC has worked with governments across the country to help make affordable home, auto and business insurance available for all Canadians. IBC supports the vision of consumers and governments trusting, valuing and supporting the private P&C insurance industry. It champions key issues and helps educate consumers on how best to protect their homes, cars, businesses and properties.

P&C insurance touches the lives of nearly every Canadian and plays a critical role in keeping businesses safe and the Canadian economy strong. It employs more than 120,000 Canadians, pays $9 billion in taxes and has a total premium base of $52 billion.

For media releases and more information, visit IBC’s Media Centre at www.ibc.ca. Follow IBC on Twitter @InsuranceBureau and like us on Facebook. If you have a question about home, auto or business insurance, contact IBC’s Consumer Information Centre at 1-844-2ask-IBC.

If you require more information, IBC spokespeople are available to discuss the details in this media release.

SOURCE Insurance Bureau of Canada

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