As B.C. drivers face the new reality of risk-based insurance rates for their vehicles, and the higher rates that often go with it, private insurance companies are renewing their call for the Insurance Corp. of B.C. to loosen its hold on driver and accident records to allow more competition.
ICBC faces few competitors for optional insurance, covering collision and other risks beyond required basic liability insurance, said Aaron Sutherland, vice-president of the Insurance Bureau of Canada. The key reason is that ICBC won鈥檛 share its claims data directly with competitors, as happens in other provinces, he said.
Sutherland was responding to Attorney General David Eby鈥檚 challenge, reported by Black Press Media last week, that private insurers should step up with better deals for new drivers who are facing big increases in optional insurance coverage.
鈥淚n B.C., ICBC holds that driving record and they won鈥檛 share it,鈥� Sutherland said in an interview. 鈥淭hey know that if other insurers could get access to this, they could better price. You would have more insurers coming to B.C., and you would start to see ICBC鈥檚 market share get whittled away.鈥�
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Eby said Tuesday he supports the idea of increased competition, as young drivers in particular find their rates going up as much as 12 per cent for basic insurance and in some cases more for optional coverage.
Eby defended ICBC鈥檚 current practice of requiring drivers to retrieve their own 鈥渄river abstract鈥� or claims history from ICBC鈥檚 website, and sharing it with private insurers to get a quote on optional coverage. ICBC allows drivers to get it themselves or enter the e-mail address of a competing insurer so it can go directly there, he said.
Eby said he has no problem with opening driver history up to direct access by private insurers, but there has been no 鈥減olicy work鈥� done so far to make that change. And he questioned whether making drivers doing their own research is the problem.
鈥淚 do believe that private insurers don鈥檛 actually find it profitable to compete in B.C. because it鈥檚 an expensive place to write insurance,鈥� Eby told Black Press. 鈥淚f there were money to be made here, writing cheaper insurance for inexperienced drivers, which they keep issuing press releases [saying] is the case, they would be doing it, even if it was a bit of a pain for people to get.鈥�
Eby said if the issue was so pressing for private insurers, they would have brought it up before. Sutherland responded by copying Black Press with a letter he sent to Eby on Sept. 10, 2018. (See letter below.) The letter offers to pay ICBC an administrative fee for direct access to ICBC鈥檚 database.
鈥淚n other provinces, private insurers pay between approximately $9 and $16.50 for driver abstracts,鈥� the letter states, pitching it as a significant revenue opportunity for ICBC as it grapples with soaring costs and deficits.
Eby said the letter 鈥渞ings a bell鈥� and suggested he will look further into the situation.
Sutherland said there only two significant private insurance competitors for ICBC because customers don鈥檛 walk in to their offices with a copy of their claims record in hand. Few people will actually take the trouble to retrieve it from ICBC and share it with a competitor, he said.
The barrier for competition goes beyond individual driver records, Sutherland said. ICBC also holds the only database for high-accident locations, creating a 鈥渟tatistical plan鈥� for each area where an insurance company might offer coverage.
鈥淥ther insurers can鈥檛 see that, so they don鈥檛 really know the marketplace, or the communities in which they鈥檙e going to start selling,鈥� Sutherland said. 鈥淎nd then piling on that, you鈥檝e got customers coming in your door, and you can鈥檛 verify their driving record, so you鈥檙e basically flying blind.鈥�
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