The ink was barely dry on BC’s new auto insurance coverage rules and rates when, earlier this month, the provincial government stepped in with more changes.

In our last post, we covered the first announced ‘tweak’ — the waiving of the premium for Unlisted Driver Protection add-on until a first crash under the new system.

Two other changes announced by the government at the same time also represent common-sense adjustments, aimed at helping both policyholders and ICBC navigate the transition smoothly.

The first is all about plugging a hole in the new rating logic. Starting September 1, the risk factor of secondary drivers listed on policies is accounted for, which can result in total premium costs being weighted higher — or lower — than they would otherwise be solely by considering the driving history of the principal driver.

That meant that the possibility existed that a policyholder could artificially reduce their premium by seeking out low-risk drivers to name on their policy, thus ‘diluting’ that rated risk.

The result of this loophole would allow some policyholders to unfairly avoid paying their fair share of insurance premiums.

The province caught this loophole, and have amended the rules so policy holders may not list secondary drivers on policies unless they are household members or employees (who comprise the most common types of secondary drivers).

The second adjustment to the new auto insurance rules relates to the timeframe available to claimants to pay down past claims.

On September 1st, 2019, the ability to pay down claims in excess of $2,000 was scheduled to end, which would effectively mean larger claims would increase a policyholder’s premium. In a helpful change to all those with claims filed between March 1, 2017 and August 31, 2019 (the final day under the old insurance rules), ICBC will now allow all claims to be repaid in full, no matter the cost, up until August 31, 2020.

That’s because, in some cases, policyholders won’t know until a full year has passed under the new rules whether paying a particular claim will have a noticeable effect on their new insurance premiums going forward. Some may choose to pay down their claim, and some may choose to accept a slightly higher premium, saving money in the near-term.

In this case, it’s a helpful concession from ICBC to British Columbians that not only can change be difficult, but with such a long list of updates to the insurance system overall, there are bound to be unforeseen consequences and wrinkles to an otherwise sound plan.

Drivers can apparently rely on ICBC and the province to continue to work together to iron out those wrinkles before September 1, 2019.

Stay tuned for more updates!

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