ICBC’s recently published annual report summarizes how the public auto insurer achieved a $1.4 billion net income for 2023/24. This Commentary provides a number of perspectives and suggests that the government should direct ICBC to reduce the Basic program’s high capital reserve.
The “modified equity” accounting system distorts the government’s revenue, and surplus/deficit position, by assuming revenue from ICBC is available to the government. This can cause a major distortion as occurred for 2023/24.
The Manitoba public auto insurer is seeking a three per cent increase in Basic rates for 2025/26 after suffering large claims losses last year.
It appears that the government has “negotiated” a profitable deal for purchase of ICBC’s headquarters building. Is this another example of politicizing our public insurer?
This paper reviews certain aspects of the latest Basic insurance rebate ordered by the government.
The Alberta government recently issued new consultation documents designed to focus the public discussion on affordable auto insurance. The lowest cost option, a public monopoly modeled on ICBC, was quickly denounced by the Insurance Bureau of Canada.
The government of Ontario is proposing to reduce mandatory Basic injury coverage in an attempt to provide more choice—read less coverage. This follows the plan to reduce vehicle damage coverage begun this year.
The paper reviews the current year forecast and the budget plan for 2024/25. The third quarter 2023/24 results are also examined.
ICBC's resultsf for the first six months of 2023/24 were encouraging, as reviewed in the attached commentary.
This is the first in-depth look at ICBC's Optional claims information.
The Alberta government replaced the auto insurance rate freeze with a cap pending a review of options to reduce longer-term costs.
Recent comments by the IBC may signal how the Alberta government will restructure its auto insurance liability model. See also https://www.canadianunderwriter.ca/legal/whats-contributing-to-rising-auto-premiums-in-alberta-1004238314/
This paper has a more detailed review of ICBC's 2022/23 financial results by major program. Of note is the rise in materail damage costs and tort injury pressures.
This report provides a summary at the corporate level of the 2022/23 financail results.
This report shows ICBC claims information to 31 March 2023, provided through the FOI process.
Ths paper examins certain highlights of the MPI annual report.
Affordable auto insurance rates continues to be a pressing matter for the Alberta government. This paper reviews some recent developments.
New accounting rules that took effect on April 1, 2023, will aggregrate revenue and expenditure information making analysis much more difficult.
The Manitoba government has joined the trend of provincial governments to politicize the pricing of auto insurance rates. Four examples are presented.
ICBC has forecast significant net income over the next two years using inflated investment income.
Ontario continues to experience high auto insurance premiums. A new initiative could see lower rates but result in much less protedtion.
For many years BC governments have required ICBC policyholders to subsidize a variesty of governmet programs or policies, as detailed in the Commentary.
This paper reviews the BCUC decision to advance the rate request review for the next two years, and discusses ICBC's distorted approach to forecasting the investment income.
This Commentary summarizes the status of the main challenges to the hybrid tort and no-fault liability model.
This paper reviews ICBC's latest service plan forecast for 2022/23, and its third quarter financial summary.
The cost of auto insurance has again become an election issue in Alberta. This paper provides context for the government decision to freeze fates for the balance of 2023.
As a result of the change to a no-fault model ICBC rates comare favourably with those with hybrid-tort models, but are higer than Saskatchewan and Manitoba. See also Derrick Penner Vancouver Sun December 14, 2022.
This paper raises some questions about ICBC's forecast operating loss based on the second quarter financial summary.
In a recent decision the Manitoba Court of Appeal declined to hear an appeal by the MPI public auto insurer concerning a decision by its refulator. Perhaps Manitoba will adopt the more directive approach used by the government in this province?
This report has a closer look at ICBC's 2021/22 financial results at the program level compared to the results of the prior year.
FY 2021/22 was historic for our public auto insurer, both for the shift to no-fault and the historic combined operating profit.
A new report shows that private Canadian Property and Casualty insurers make record profits in 2021. This paper has a closer look.
The Ontario NDP has promised a major reduction in auto insurance as part of its election platform. This paper has a closer look.
A recent Globe and Mail editorial cantained factual errors about the recently announced insurance rebates in BC and Saskatchewan. Taxpayers are not subsidizing drivers in these provinces.
The decision to proceed with a rebate signifies the adoption of more realistic capital reserve targets. Linking the rebate to offsetting high fuel costs has clouded a positive picture.
President Jimenez says rebuilding the capital reserve will take time, but the latest forecast suggests that ICBC has sufficient capital to provide a rebate now.
ICBC has forecast a record profit of $1.9 billion for the current year. This Commentary reviews the forecast and the Q3 report.
Each year Basic policyholders contribute close to $30 million to fund traffic enforcement through additional police resources and through intersection radar cameras. This paper has a closer look.
The Ontario government may eliminate the $120 vehicle registration fee in the run-up to the June election resulting in a taxpayer subsidy to drivers.
Update https://nationalpost.com/news/canada/ontario-legislators-return-for-pre-election-session-today
https://globalnews.ca/news/8636625/ontario-licence-plate-sticker-renewal-cancelled-refunds/
Starting January 1, 2022, the basoc mandatory auto insurance for vehicle damage claims converted to a n-fault model. Injury claims remain in the hybrid tort model, where pain and suffering awards for minor claims are capped.
ICBC's minimalist half-yer summary report shows improved financial health, but lack of service measue data make detailed analysis impossible.
This commentary summarizes the key issues in the BC Utilities Commission's recent decision.
The public auto insurers in Saskatchewan and Manitoba have reported claims costs tracking below the budget forecasts due to the continuing effects of the measures to supress the pandemic. This may result in more rebates to policyholders.
This paper provides a general review of ICBC's positive first quarter financial reults.
Recently, the CEO of Intact Financial stated that the BC government should provide options respecting the purchase of Basic auto insurance. Intact abandoned the BC market at the end of 2020.
This paper continues the review begun on 29 July 2021 of ICBC's 2020/21 financial turnaround. This time the results at the program level are highlighted.
ICBC's 2020/21 financial results show a marked improvement in profits and equity, with most of the improvement due to re-estimation of prior years claims costs and improved investment valuation.
In its recent three year plan, and its rate submission to the BC Utilities Commission, ICBC is forecasting significant financial improvement in the finances of the Basic program compared to 2019/20. Only by merging the two data sets can one discern the forecast for the Optional program.
This paper looks at the major increase in ICBC's back office staffing planned for the next two years.
The government has introduced legislation to expand ICBC's refuse to issue program to encompass unpaid fines relating to the pandemic. The government should reimburse ICBC, otherwise policyholders will be providing another subsidy to taxpayers.
ICBC has applied to the BC Utilities Commission for a 11.5% Basic rates increase to begin to rebuild the capital reserve. Yet the detail of the forecast increase in the capital available by year-end 2022/23 is much less than what ICBC proposed in its initial application. Where is the missing equity?
ICBC's financial forecast for 2020/21 and the budget for 2021/22 show a marked improvement over the significant operationg losses recorded in recent years.
The Saskatchewan government just announced a one-time premium rebate for Basic insurance policyholders. Saskatchewan's Basic insurance program has witnessed strong grown due to the pandemic related declines in claims costs and strong investment returns. This paper compares the rebates announced for this province and Manitoba and BC.
While the government has slackened its tight control of the BC Utilities Commission respecting BC Hydro, it shows no signs of a similar move with respect to ICBC's Basic insurance. This paper looks at recent developments.
This paper takes a closer look at the limited information available to asses the desision to provide a COVID-19 rebate.
After a two month delay, and the announcement of a COVID-19 rebate, ICBC finally posted its second quarter financial summary. It appears that the government delayed the release of a key accountability document in order to make a political announcement. See also Bob Mackin's comments of February 4, 2021; thebreaker.news/news/icbc-dumpster-spin/
ICBC's half year financial report is long overdue. It appears that the government is withholding the Q2 actual financial results to avoid more questions about a COVID-19 rebate. Accountabiity takes a backseat to the political agenda. Rob Shaw, writing for the Orca, also commented on the missing report https://theorca.ca/resident-pod/rob-shaw-icbc-should-reveal-whats-under-the-hood/
This Commentary reviews ICBC's Basic rate request filing for the 23-month period commencing 1 May 2021. Many questions remain.
The Manitoba public insurer is providing rebates related to lower costs resulting from the pandemic. ICBC, by contrast, has an unhealthy financial position and the government should resist the urge to follow suit.
Through legislation and regulatory changes Alberta is making a number of significant changes to the auto insurance system in that province. A major change is the adoption of a no-fault model for vehicle/property damage.
In the last two years ICBC has increased the reserve for prior years claims by an extraordinary $2.4 billion. This paper attempts to find the reason for this huge increase.
This commentary discusses the recent announcement by Intact Financial that it would stop selling Optional auto insurance in BC.
A committe appointed by the Alberta government has recommended that the government scrap the hybrid tort scheme and legislate a no-fault auto insurance plan as oon as possible. This paper has a closer look.
Using claims data obtained through the FOI process, this paper summarizes the recent decline in ICBC's Basic claims and claim costs. This data should be part of ICBC's regular reporting.
Auto insurance affordability is an issue in the Saskatchewan election, where robust capital reserves have promted the opposition NDP to pledge rebates and a rate reduction. The main parties in BC have avoided the issue of ICBC's low capital reserves.
The Liberal party's populist promises to remake the auto insurance market have significant problems for ICBC and for policyholdrs in general. Affordability and expanded coverage can be be achieved theough adhering to the monopoly no-fault model.
The first quarter results show a marked rebound in net income and the value of the financial investments compared to three months ago. This paper highlights three areas.
With a slide into negative equity, ICBC does not have any capacity to provide policyholders with a COVID-19 driven rebate as advocated by the BC wing of the Canadian Taxpayers Federation. To do so would expose taxpayers to a greater risk of subsidizing policyholders.
ICBC recently reported a significant increase in vehicle reinsurance reflecting a return to more normal vehicle use. Unfortunately its financial data for 2019/20 has not been released by the government, nor any service or performance data.
A pending report from a government appointed panel is expected to recommend an expansion of no-fault insurance in that province. The attached commentary has a closer look.
The public auto insurer in Manitoba plans an overall 10.5% reduction in Basic rates for April 2021. Because the new no-fault model for ICBC is based on the Manitoba system a closer look is warranted.
The prospect of continuing low interest rates will place further strain on the financial statements of ICBC and BC Hydro. The poor financial health could twart government attempts to lower insurace rates or provide cheaper electricity.
A new ICBC report distorts the impact of the COVID-19 pandemic on its revenue and expenditures, presenting what is likely the worst case scenario. This further erodes the public's trust in our public auto insurer.
A month ago Attorney General Eby said he had asked ICBC for a report on the impact of the COVID-19 pandemic on its finances. This commentary suggests what such a report might disclose.
The government should take the opportunity presented by ICBC's windfall claims cost savings to de-politicize rate decisions. It should allow the BCUC to make the determination as to whether the savings should be rebated to policyholders.
This paper reviews the decision of Allstate Insurance to provide a premium rebate to return some of the windfall claims savings to its customers. The government has not stated if ICBC will also return some of the windfall savings to policyholders.
The recent financial market melt-down has reduced ICBC investment assets. ICBC's lack of a capital reserve will likely mean that its liabilites will exceed its assets by year-end.
Finance Minister Carole James suggested that the losses at ICBC have displaced government spending on other programs. This is not correct.
The recent decision by the government to adopt a no-fault enhanced care model marks a fundamental change for auto insurance in B.C. This paper reviews some of the benefits.
This paper suggests that the arguing that private insurers could provide lower rates compared to a public model misses the main reason for the lower rates enjoyed by drivers in Saskatchewan and Manitoba. The lower rates are the result of the no-fault liability model.
The changes announced by minister Eby do little to improve accountability at ICBC. This paper provides suggestions to improve ICBC's public reports.
This commentary reviews a number of developments respecting auto insurance in B.C. and Alberta that occurred during the last two weeks.
This commentary reviews ICBC's April to September 2019 financial report to determine if the forecasted $91 million year-end operating loss is reasonable. Unfortunately, ICBC continues to restrict the information available making a proper review impossible.
Public sector accounting standards require that ICBC's operating losses be deducted from the government's total revenue, but this does not translate into a reduction in funding for government programs. The accounting standard adds to the confusion about the impact of ICBC's operations on the government's finances.
A summary of media reports from October 24th to November 1st respecting ICBC's finances. Includes comments by Todd Stone and hints by David Eby about no-fault.
This paper reviews recent initiatives by the Manitoba government to provide direction to the Crown insurer and the provincial regulator. A comparison is made to British Columbia, where provincial governments have a been interfering with ICBC and the B.C. Utilities Commission for years.
It now appears that the cabinet-ordered limit on expert reports was rushed to avoid insolvency at ICBC as of 31 March 2019.
On October 18, 2019, Lindsay Matthews provided a response to my questions about the estimated savings resulting from the government's limitation on the number of expert reports.
Yesterday on CFAX radio, Attorney General David Eby suggested that young and inexperienced policyholders facing massive price increases should purchase less insurance. My comments are attached.
In the evolving "crisis" in the Alberta auto insurance market it now appears that drivers with moving violation convictions are being denied Optional coverage.
This Commentary discusses key aspects of the Q1 financial report. ICBC needs to include service measures with the financial data.
The new Albetra government has eliminated the 5% limit on auto insurance rate increases imposed by the NDP government in December 2017. The limit, combined with large increases in claims costs, was causing distortions in the market, and large rate increases. The government has yet to address the coverage issues. The B.C. government continues to limit increases in ICBC's Basic insurance.
A new provincial auto insurance price comparison estimate showing B.C. drivers paying the highest rates is highly simplistic, as demonstrated in my Commentary. Correspondence with Aaron Sutherland of the ISB is also included. Related item;https://pressprogress.ca/bc-news-outlets-exaggerated-the-cost-of-public-car-insurance-their-numbers-came-from-a-big-insurance-lobbyist/
In the August edition of The Broker magazine Chuck Byrne, the exectutive director of the Insurance Brokers Association, wrote an editorial in support of the public model for the provision of compulsory insurance. Exerpts of this editorial are attached.
A new report shows significant increases in the cost of auto insurance in Alberta and Ontario. This seems to contridict the claims that competition results in lower prices.
The MPI is on solid financial footing and seeks to stregthen the Basic capital reserve. It is seeking a minimal Basic rte increase for 2020. The no-faulth auto insurance model in Manitoba is compared to the scheme in BC.
This Commentary attempts to answer the question as to what percentage of BC drivers carry additional third-party liability insurance greater than the $200,000 limit in the compulsory Basic program. ICBC does not make public its Optional sales.
The government is lowering the seniors' discount from 25% to 15%, but still requiring other policyholders to pay more to make-up for the lost revenue. What dos this subsidy cost?
At a time when the concept of a public monopoly providing auto insurance is being questioned, one would expect ICBC to retain the public's support by being transparent and accountable. Unfortunately, the opposite appears to be the philosophy adopted by the management at ICBC as evidenced by witholding the forecast injury severities from public view.
This commentary explores three areas where ICBC appears to be providing poor advice, focusing in particular on financial forecasting and an apparent move to reduce transparancey and accountability.