Has the No-Fault Liability Model Achieved the Intended Objectives?
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This paper examins the early data available to asses how well the change to the no-fault model has achieved the government's objectives.
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Is the Plan to Freeze Basic Insurance Rates Affordable?
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Can ICBC afford the two-year rate freeze ordered by the government? This paper reviews its new rate request to the Utilities Commission and finds it fundamentally flawed because ICBC management failed to address this important question.
Six Years of ICBC Operational Data to 2021/22.
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Occasional Paper No. 85 provides six years of various ICBC financial and operational data to fiscal yrar 2021/22.
A Closer Look at ICBC's Remarkable Financial Turnaround.
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Occasional Paper 82 provides a more detailed analysis of ICBC financial rebound during the past two years.
ICBC Multi-Year Operating Statistics to 2020/21
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Occasional Paper No. 81 provides a multi-year compilation of actual key financial and operating measures to 2020/21.
ICBC Multi-Year Statistics to 2020/21
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Occasional Paper No. 79 refreshes previous financial and service measures wih the actuals to 2020/21.
Pulling Back the Curtain: Seven Years of ICBC Operational Data
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- Unlike most provincila Crown corporations and other public agencies, ICBC does not provide detailed service measures in its' service plans or annual reports. Occasional Paper No. 74 (slightly revised by No. 74a) partially addresses this shortcoming by providing a single source of key financial data for the last seven years.
ICBC's 2019/20 Annual Report: Further Losses and Negative Equity
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The 2019/20 annual report presents a mixed picture with a number of positive signs, as outlied in Occasional Paper No. 71. It will take some time to restore the financail health of our public insurer.
ICBC Reports Show Improvement in Finances: But Not In Transparency and Accountability
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Occasional Paper No. 70 reviews ICBC's third-quarter report for 2019/20 as well as the year-end forecast. There has been a major improvement in the operating results, but the lack of service measure data makes analysis difficult. ICBC has not improved its transparency and accountability.
Teetering on the Brink of Insolvency: A Look at ICBC's 2018/19 Financials.
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Occasional Paper No. 69 reviews the highlights of ICBC's 2018/19 annual report and suggests areas for further review.
ICBC Statistical Summary.
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Occasional Paper No. 68 attempts to provide a single source of key service measure data at the program level for the last four or five years. This is to compensate for the dearth of such information provided by ICBC.
Observations on ICBC's Financial Forecast and the Fiscal Plan.
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Occasional Paper No. 66 reviews aspects of ICBC's latest 3-year financial forecast, and suggests that the claims costs for 2019/20 are overstated. The absence of the assumptions used to develop the forecasts makes any detailed analysis impossible. Also discussed is the accounting treatment of the net income of ICBC and B.C. Hydro.
Regulator Failed to Warn of ICBC's Financial Crisis.
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The BC Utilities Commission's process for reviewing ICBC's Basic rate requests is not designed to link to the fiscal year, not to multi-year forecasts. This should be reformed to provide an early warning system for the future.
ICBC's Q2 Results: More Red Ink and Even Less Transparency
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On Friday the government released ICBC's second quarter excuse for a quarterly report, and a unsubstantiated forecast of a $890 million loss for the current fiscal year. Occasional Paper 64 reviews the numbers and suggests that the year-end forecast may be optimistic.
ICBC Suffers Worst Ever Financial Year. August 28, 2018.
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The just released 2017/18 annual report shows a combined Basic and Optional operating loss of $1.3 billion, and the capital reserves are now dangerously below the safety margins. Occasional Paper No. 60 reviews some of the key indicators.
Observations Respecting ICBC's New Premium Model. August 16, 2018.
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The new Basic premium model targets younger drivers, and at-fault drivers to give a financial benefit to older drivers. More comments are included in Occasional Paper No. 59.
Positive 2017/18 Financial Results from Public Auto Insurers Contrasts With ICBC Forecast. July 18, 2018.
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This paper reviews the positive 2017/18 annual reports of the public auto insurers in Saskatchewan and Manitoba for both the compulsory Basic and the optional programs. This contrasts with ICBC's forecasted combined loss of $1.4 billion.
Why Does the Government Condone Poor Public Accountability at ICBC? June 25, 2018.
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This paper examins ICBC's main accountability reports in light of the accountability model adopted by government in the early 2000's. The level of public accountability is poor, and the government should require ICBC to make significant improvements.
Should the Government Return the $1.2 Billion Appropriated from ICBC Poilcyholders? April 20, 2018.
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Between 2010 and 2015 the provincial government appropriated almost $1.2 billion of Optional policyholders' capital. Now -- with the province's finances healthy and the ICBC capital reserves almost eliminated -- would seem an appropriat time to return the funds. Occasional Paper No. 56 estimates the Basic and Optional capital shortfalls to 2021/22.
Subsidizing Seniors: ICBC and BC Ferries. April 9, 2018.
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The recent announcement of an increase in the fare subsidy for seniors on the BC Ferries prompted me to review an earlier estimate on the cost of the 25% seniors' subsidy at ICBC's Basic insurance. If the government funded the sudsidy it would relieve some of the pressure on Basic rates.
ICBC Rate Re-Design; Evidence or Populism?
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Occasional Paper No. 54 looks at the current design for pricing risk and some of the changes being suggested in the current public consultation.
ICBC's Three-Year Forecast Raises Many Questions. February 27, 2018.
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ICBC's 2017/18 to 2020/21 financial forecast shows the combined capital reserve falling to dangerously low levels. However many inconsistencies make the forecast suspect. Also included is Acting CEO Nicolas Jimenez's email of March 15th, my reply of March 19th and his reply of March 28th.
The 'Transaction' Cost of the Tort Model. February 5, 2018.
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This paper suggests that injury claimants received only 57% of the $2.0 billion paid by ICBC in 2015 for no-fault accident benefits and injury claims. The balance was absorbed in 'transaction' costs.
New South Wales Adopts Hybrid No-Fault Scheme for Auto Injury Claims. January 30, 2018.
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This paper discusses the auto injury claim models in the states of New South Wales and Victoria, and in New Zealand, with possible lessons for BC.
ICBC's Second Quarter Report: More Bad News and Less Information. December 29. 2017.
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ICBC recently posted its second quarter 'Statement of Operations,' which is highly deficient as a quarterly report from such an important Crown corporation. Occasiona Paer No. 50 compares the results with Saskatchewan's compulsory insurance program in an attempt to understand the reasons for the continuing losses.
ICBC's Capital Reserve Minimums Are Too High. December 21, 2017.
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The government should lower the minimum capital targets to reduce the current and forecasted capital deficiency, Given the nature of the Basic monopoly, and the near monopoly enjoyed by the Optional program, the targets should be lower, thereby reducing the pressure on future rates.
ICBC's Financial Crisis: How Did It Happen? December 17, 2017.
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This paper provides a high-level review of how ICBC's costs out-stripped revenues from 2012 to 2016/17, and focusses in bodily injury claims costs.
The paper suggests that capping pain and suffering claims for minor soft tissue injury claims will not generate sufficient savings to treturn ICBC's finances and capital reerves to a satidfactory condition.
Fixing ICBC's Finances: Four Changes the Government Should Make. December 4, 2017.
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The government is planning changes to ICBC's insurance model to reduce costs. Occasional Paper No. 47 discusses areas where the government should re-imburse ICBC policyholders for current programs or policies that benefit the taxpayer.
ICBC's Capital Forecast: Finance Minister James Concerned. October 11, 2017.
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ICBC does not publish multi-year financial forecasts, but Occasional paper No. 42 procides a scenario of the capital deletion to 31 march 2020. Little wonder that finance minister James is concerned.
Capital Destuction at ICBC Continues September 29, 2017.
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ICBC's forecast for 2017/18 shows a continuation in th loss of capital. Occasional Paer No. 41 traces the loss by program from 2010 to 2017/18, and confirms the structural deficit of approximately $400 million per year in the Basic program.
Taxpayers Federation Wrong; BC Auto Rates Fourth Lowest, Not Second Highest. September 8, 2017.
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Comparing auto insurance prices across provincial jurisdictions is a difficlut task. Occasional Paper No.40 shows that the methodology used by Mike Milke in a recent Canadian Taxpayer Federation report is flawed.
Observations on ICBC's 2016/17 Annual Report. September 1, 2017.
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The recently released 2016/17 annual report shows that the financial condition at the public insurer is going from bad to worse, as outlined in Occasional Paper No. 39.
Further Questions About the Ernst Young Report on ICBC. August 20, 2017.
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A more detailed review of the Ernst Young report raises serious concerns about the costing methodology, and the savings that might be achieved by capping pain and suffering awards on minor injury claims. The are discussed in Occasional Paper No.38.
Ernst Young Options to Increase Auto Insurance Affordability. August 6, 2017.
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This paper reviews the Ernst Young report's options to increase the affordability of auto insurance. It questions some of the proposed cost savings and recoomends the adoption of Saskatchewan's dual Basic model.
Comments on the Financial Aspects of the Ernst Young Report. July 31, 2017.
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My comments on the financail aspects of the July 10, 2017 Ernst Young report on ICBC are included in Occasional Paper N0. 36, distributed on July 30, 2017.
ICBC Capital Depletion and Claims Backlog. April 9, 2017.
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This paper reviews the last four years capital depletion and the growth in the claims backlog at ICBC.
ICBC Gets Tough on Bad Drivers, and Tougher on Good Drivers. March 5, 2017
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ICBC announced a toughing of its Basic insurance discounts for 2018, which will result in higher insurance for at-fault drivers; good drivers will be big losers.
New Government Must Fix ICBC's Finances Soon. March 30, 2017.
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A detailed review of ICBC's three-year forecast shows alarming loss of capital; immediate and longer-term initiatives are suggested to restore ICBC's finances to a healthy condition.
ICBC's Worsening Finances Require Government Action. March 24, 2017.
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The new provincial government must make the restoration of ICBC's financial health a priority, as capital reserves are now below the regulatory minimums,and rake shock looms.
Cold and Snowy Winter Helps BC Hydro - Hammers ICBC. March 19, 2017.
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A review of the financial impacts of the cold and snowy winter on the finances of BC Hydro and ICBC.
ICBC Basic Claims Costs 2012 to 2015. 12 December 2016.
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This Occasional Paper (No. 18) reviews ICBC claims data from 2012 to 2015 to attempt to identify cost drivers. The outlook for the medium term is as discussed.
Thoughts on Recent ICBC Events. 27 November 2016.
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My thoughts and comments on recent events concerning ICBC's rates and financial condition.
Rate Suppression and Capital Destruction: ICBC Rate Shock Lurking. 17 November 2016.
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This paper describes how the government's rate suppression policy has used ICBC's capital reserves to subsidize lower than required Basic program rates. In essence, the government is using policyholders' savings to keep the required rate increases from becoming an issue of public concern. Soon the capital reserve will be at minimum levels, and policyholders will be faced with the deferred bill.
Accounting Rules Over-state Government Revenue on Actual Cash Basis 21 September 2016
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Canadian public sector accounting rules treat the net income of self-supporting Crown corporations provincial revenue, even though the actual cash transferred can be significantly less, or zero. 21 September 2016
The Implications of ICBCs 2016 Rate Changes on Its Capital Reserves 31 August 2016
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Possible negative implications of ICBCs 2016 rate changes on its Basic and Optional capital reserves. 31 August 2016.
Government Financial Benefit from ICBC 30 March 2016
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A short survey of the financial benefits the goverment receives from ICBC. 30 March 2016.
Basic Insurance Part 7 Benefits 2 April 2016
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Part 7 Benefits of ICBCs Basic insurance coverage include medical rehabilitation, wage loss, home care and death benefits; the maximum levels have not been increased since 1991. 2 April 2016.
Impact on ICBC Bodily Injury Claims Costs of Proposed Civil Rules Tariff Changes 2 April 2016
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This paper discusses how the 2016 proposed changes to the civil court rules tariff may increase Basic insurance costs. 2 April 2016.
Caps on Pain and Suffering Awards 26 July 2016
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The following provides a source of selected sources for further research on the issue of caps on non-pecuniary (pain and suffering) damage awards for vehicle insurance claims. 26 July 2016.
The Greying of ICBCs Policyholders 22 August 2016
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What are the implications of the aging demographic of ICBC policyholders on the future price of auto insurance? 22 August 2016.
The Recent Growth in ICBC Claims Costs 30 July 2016
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The causes and effects of the recent increase in ICBC's claim costs are reviewed. 30 July 2016.
ICBC's Declining Capital Reserve Levels 30 July 2016
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ICBCs First Quarter 2016 financial results confirm that rising claims costs and declining investment income are rapidly reducing its capital reserves, which are required to pay outstanding claims. 30 July 2016.
ICBC Facing Severe Financial Pressure 30 July 2016
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ICBC's poor 2015 financial results should be of concern to the government and to policyholders. 30 July 2016.