ICBC submits rate application with utilities commission
As announced on November 29, ICBC confirmed on Thursday that it is submitting an application with the British Columbia Utilities Commission (BCUC) for an increase to its basic insurance rates for 2012. At the same time, ICBC confirmed an average decrease to its optional insurance rates for next year. When combined, the changes will cost the majority of customers an average of $27 more per year. The insurer said the increase will raise the average premium from its current $1,277 per year to $1,304.
“The only way to fully understand these rate changes and the impact on our customers, one must look at them in combination” said Jon Schubert, ICBC president and CEO. “If you look at just the basic or optional change in isolation, then it gives you an incomplete picture for the majority of our customers who write one cheque for their insurance policy.”
ICBC’s application to the BCUC will ask for an average basic insurance increase of $68 or 11.2 per cent per customer, which will be reduced by an average decrease in its optional insurance rates of $41 or six per cent. When the rate changes are combined, the majority of customers – those who purchase their full personal vehicle insurance coverage from ICBC – will see an average rate increase of $27 or 2.1 per cent.
The $27 increase is an average for approximately 80 per cent of ICBC’s personal insurance customers. Each individual premium is based on a number of factors including claims history, type and use of vehicle, where you live, years of experience and the level of coverage purchased.
“The average premium our customers pay today is approximately the same as it was in 2008 but, after four years of not having to increase our rates, we now unfortunately face a different reality,” said Schubert. “We’re not happy that we need to increase our rates but the majority of our customers will be paying just a few dollars more, on average, than they did in 2008.”
The decrease in optional rates is made possible primarily due to the continued drop in auto crime and material damage claims.
“Our priority is to ensure that this rate increase is as low as possible so the impact on our customers is kept to a minimum,” said Schubert.
Those who only purchase basic insurance coverage through ICBC will see an average increase of $68 a year.
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