Mike Smyth: Lawyers prepare to fight government on car-crash injury payouts

In case you missed it: "Significantly, the proposed new laws give power to the provincial cabinet to change the definition of “minor injury” later." What’s ‘minor’ to ICBC could have a major impact on your health. Columnist Mike Smyth writes about the B.C. government's overhaul of ICBC.

Mike Smyth: Lawyers prepare to fight government on car-crash injury payouts

Published on April 28, 2018

For British Columbians who live with chronic pain, the daily misery and suffering is real to them, and it never goes away.

But sometimes the pain is not real to a lawyer, or to an insurance adjuster or even to a doctor.

That’s why Heather Divine is disturbed by the B.C. government’s move to cap financial payouts for pain and suffering to people who suffer “minor injuries” in car crashes.

“What’s ‘minor’ to an insurance company can have a major impact on the life of someone living with daily pain,” said Divine, founder of People In Pain Network.

“Pain and suffering doesn’t show up on an X-ray or an MRI,” she said. “Pain is often invisible. Who will stand up for these people if the government takes away their rights?”

But Attorney General David Eby said the government is being forced to take action because court awards for minor injuries are driving ICBC into financial ruin. The public auto insurer is set to lose a shocking $1.3 billion this year.

“We have to rein in out-of-control legal expenses,” Eby said.

But not without a fight from car-crash victims, and the personal-injury lawyers that represent them.

Last week, Eby introduced a series of bills in the legislature to drastically overhaul ICBC’s claims process and save the money-losing Crown corporation more than $1 billion a year.

It includes a cap of $5,500 on pain-and-suffering awards to people who suffer minor injuries in motor-vehicle accidents. Those court-ordered awards currently average around $30,000 but can soar much higher in many cases.

The government is also diverting most ICBC claims — those valued at $50,000 and under — out of the Supreme Court of B.C. and into Civil Resolution Tribunals.

Now British Columbia’s personal-injury lawyers are girding for battle.

“The government is taking away the rights of injured people,” said Ron Nairne, vice-president of the Trial Lawyers Association of B.C. and a personal-injury lawyer based in Burnaby.

The association is the founding member of a coalition called ROAD B.C., which is fighting the government’s changes with an advertising campaign, petition drive and website.

The website has a “real stories” section where people injured in car crashes describe the impact on their lives.

“The pain was constant,” writes Deborah P. of Coquitlam, who suffered neck and shoulder injuries in two separate accidents.

“Life as I knew it changed. My ability to do my job and live the life I had was limited. Had my injuries been capped, I am afraid I would not have had a full and fair compensation.”

“My hands were very badly damaged, and they still are from the accident, but I also received a head injury,” writes Cassandra O. of Mission.

“I’m quite sure my husband and myself and my two children would have been completely destitute had there been a cap placed on my settlement.”

Eby emphasizes the caps would not apply to major injuries like broken bones, brain damage, paralysis and other serious impairments. People who suffer these major traumas would still have full access to the courts.

But the caps would apply to minor injuries, which the government defines as “abrasions, contusions, lacerations, sprains, strains, pain syndrome, psychological and psychiatric conditions.”

Significantly, the proposed new laws give power to the provincial cabinet to change the definition of “minor injury” later.

“We know from other jurisdictions that lawyers will try to get around the definition of ‘minor injury’ to get people into the full tort system,” Eby said.

He pointed to Alberta, where the provincial government came up with a list of minor injuries that did not include a severe form of whiplash called temporomandibular joint syndrome, or TMJ.

“As a result, Alberta became the headquarters for TMJ injuries,” Eby said, noting the syndrome will be classified as “minor” in B.C. and subject to the cap.

All of this is worrying to Divine, whose People in Pain Network has joined the ROAD B.C. campaign as it advocates for car-crash victims.

“What the government considers a minor event can cause chronic pain and major psychological problems in people, often long after an accident,” she said.

The government said a “minor injury” can be re-classified as a non-minor injury if the injured person continues to experience “serious impairment” after 12 months or a “medical professional” determines there is no expectation of improvement.

“That sounds fine, but people can still fall through the cracks,” warned Divine.

“People living in pain often don’t have the energy to advocate for themselves and other people don’t believe their conditions are real.”

Another line in the government’s press release jumped out at the lawyers: “An injury in a prescribed class of injury, even if chronic” could be considered minor, it said.

Lawyers worry this means the government could categorize post-traumatic stress disorder, depression, anxiety or other long-lasting psychological impairments as “minor” under the law.

“Injured people often develop depression because they can’t go back to their old lifestyle after an accident,” Nairne said. “They’re stuck. They’re not improving.”

He said the ROAD BC campaign has collected 17,000 names on a petition, will organize protest rallies and possibly launch a constitutional challenge to the proposed new laws.

“We’re going to push it,” Nairne said. “We’re going to fight.”

Read the full story from The Province here.

Editorial: Questions about ICBC

"When the public insurer is the one delving deeper into our pockets, is it time to ask fundamental questions?"

The BC Government's proposed legislation will give ICBC even more power and less accountability impacting not only our wallets, but potentially our health care as well.

Editorial: Questions about ICBC

Published on April 27, 2018

Forty-five years ago, B.C.’s first NDP government created ICBC to save drivers from the predations of private insurers. Today, car owners want to be saved from the predations of ICBC.

In 1973, then-premier Dave Barrett kept his election promise to answer the widespread complaints that British Columbians were being ripped off on their car insurance. His solution was affordable insurance through a public provider that could plow profits and investment returns into cheaper rates, instead of handing them to investors.

It worked. But as years passed, the corporation’s profits became too much of a temptation for governments. They began taking “dividends” from ICBC and dropping them into general revenue. Then they started interfering with rates to avoid the political fallout from raising them.

Government meddling and changing patterns of payouts have dug the corporation into a financial hole.

Now, with rising rates and proposed caps on payouts for minor injuries, drivers with long memories are experiencing flashbacks. Instead of getting ripped off by private corporations, the common perception is that we’re being ripped off by a public corporation.

If private insurers were responsible for this mess, voters would be demanding the creation of something like ICBC. When the public insurer is the one delving deeper into our pockets, is it time to ask fundamental questions?

A group called Rights Over Arbitrary Decisions charges that the government is giving ICBC “even more power and less accountability.”

Power without accountability sounds a lot like the situation that created ICBC in the first place.

Read the full story via Times Colonist here.

Vaughn Palmer: New ICBC legislation will face inevitable legal challenge

Recently, the BC Government admitted their injury caps plan is really just ICBC’s plan: “We couldn’t have done it without the assistance of ICBC… They were instrumental in this process.” – David Eby

This disregards years of ICBC mismanagement, a highly-publicized “dumpster fire” and countless stories of how ICBC has consistently put their bottom line ahead of what’s fair for British Columbians. The BC government is trusting ICBC, but have they earned it?

Vaughn Palmer: New ICBC legislation will face inevitable legal challenge

Published on April 24, 2018

VICTORIA — The New Democrats relied heavily on advice from the Insurance Corp. of B.C. in crafting legislation to cap payouts to victims of minor injuries and burgeoning legal costs, Attorney-General David Eby confirmed Monday.

The troubled auto insurance corporation supplied comparisons to what has worked elsewhere, and costed the options in what has been characterized as a “lite” version of no-fault auto insurance.

“We couldn’t have done it without the assistance of ICBC,” Eby told reporters at the release of the enabling legislation Monday. “They were instrumental in this process.”

I’m sure they were. ICBC has lobbied successive governments on no fault, shorthand for a system that limits claim costs by capping payouts and minimizing litigation.

The corporation persuaded the New Democrats to go that route the last time they were in power, only to see the drive turned back by a well-funded campaign from trial lawyers.

The government-owned auto insurer floated three variations on no fault when the B.C. Liberals took over from the New Democrats. But then-Premier Gordon Campbell squashed the notion in a letter to the ICBC board: “The government will not be considering such options at this time.”

Nor did the Liberals embrace such options under subsequent Premier Christy Clark, never mind an emerging financial crisis at ICBC and comparable jurisdictions having already gone the route of limiting payouts for minor injuries and litigation.

On taking office after a B.C. Liberal-authored financial crisis at ICBC, the New Democrats did face up to the need to finally act to contain costs.

The result was two pieces of legislation tabled Monday, one addressing the cap on settlements and other costs, the other providing for minor claims to be channelled into a less expensive dispute-resolution process.

But as legislative packages go, this one raised as many questions as it answered, being awash in generalities with specifics left for the cabinet to define by regulation at a later date.

Indeed, the government news release provided more detail than the bills.

The release promised that the legislation “will simplify dispute-resolution processes for cases under $50,000” and “introduce a limit of $5,500 on pain-and-suffering payouts for minor-injury claims.”

Neither dollar figure appears in the text of either piece of legislation. Instead, it was left to the “Lieutenant Governor in Council” (that’s the cabinet) to write those amounts into regulations at an unspecified later date.

The New Democrats backtracked on earlier specifics regarding minor injuries.

Eby initially promised “a clear, legal definition of what constitutes a minor injury” per the following:

“The new legal definition will include things like sprains, strains, mild whiplash, cuts and bruises, anxiety and stress from a crash. It does not include broken bones, brain injuries (concussions) or other more serious impairments,” vowed the Feb 6. news release from his office.

“A medical professional — not ICBC — will determine the nature of an injury and this will determine whether it falls under the definition of a minor injury. An injury initially diagnosed as minor may also be determined by a medical professional to become non-minor over time,” it continued.

“If, after 12 months, a customer continues to have serious impairment from the injury, or has a significant inability to care for themselves, it would no longer be considered minor and would not be subject to the limit for pain-and-suffering payouts.”

Most of that language was collapsed into a single paragraph in the latest news release: “The foundation for the new legal definition for what constitutes a minor injury in B.C. lists abrasions, contusions, lacerations, sprains and strains, pain syndrome, psychological and psychiatric conditions or an injury in a prescribed class of injury, even if chronic. This will be further defined in regulation over the coming months.”

Elsewhere in this legislative work in progress there is a blank-cheque provision: “Despite this or any other Act, the cabinet may make regulations respecting any matter that the cabinet considers is not provided for, or is not sufficiently provided for, in this Act.”

The cabinet also gives itself the power to “make regulations defining words or expressions used but not defined in this Act. (Call it the Humpty Dumpty clause, after the character in Alice Through the Looking Glass: “When I use a word, it means just what I choose it to mean — neither more nor less.”)

Assuming ICBC overlooked anything in its legislative asks, there’s also a open-ended clause allowing the cabinet “to delegate a matter to or confer a discretion on ICBC” as it sees fit.

Eby denied this regulatory vagueness was evidence of the New Democrats making it up as they go along. Rather, he insisted, the government needed leeway to address challenges that could arise later. While claiming these measures will together deliver a $1-billion improvement in ICBC’s bottom line, he also cautioned that effectiveness will depend on “the behaviour of lawyers” who “will try to get around” the provisions.

Surely not minister. Say it isn’t so.

The many matters left to after-the-fact regulation could also be intended to limit critics of the bill, who’ll be reduced to debating generalities while guessing at the specifics to be named later.

But given Eby’s reliance on advice from the scarcely disinterested government auto-insurance company, the inevitable legal challenge will probably include an application for the minister to release his correspondence with ICBC.

Read the full story via The Vancouver Sun here.

R.O.A.D. BC coalition calls for justice for those injured on B.C.’s roads

For immediate release

April 23, 2018

R.O.A.D. BC coalition calls for justice for those injured on B.C.’s roads

Vancouver, B.C. – Today, the Government of British Columbia (B.C.) and the Insurance Corporation of B.C. (ICBC) tabled legislation to cap compensation on what ICBC will have the power to define as “minor injuries”. On behalf of its more than 70 member organizations and more than 9,000-strong community supporters, and more than 16,000 petition signatories, R.O.A.D. BC is telling ICBC and the government to say no to capping our rights.

R.O.A.D. BC is a coalition of British Columbians who are committed to protecting the rights of anyone who becomes injured on our roads and ensuring accountability for ICBC. We are made up of individuals and associations all across British Columbia who believe the best way to protect those injured on the road and to provide stability for all road users is through established, inalienable rights – not arbitrary decisions that turn real people into a statistic.

“Being injured on the road can change your life and the lives of those around you. The path to recovery is often long, difficult and expensive”, said physiotherapist Louise Craig, coalition member and spokesperson for R.O.A.D. BC “We’re concerned that our rights as British Columbians are at stake because for ICBC it’s a “minor injury” – but for all of us, it’s life-changing.” Craig adds “It’s important to point out that “minor injury” is not a medical term – it is a term adopted by the insurance industry to standardize claims”.

Currently, in BC, everyone, and every incident is treated and assessed uniquely based on their own medical and health care professionals’ expertise and diagnosis. But now, in response to ICBC’s highly publicized “dumpster fire”, the provincial government has tabled legislation to allow ICBC to introduce caps on so-called “minor injuries” as defined by ICBC, not necessarily by your doctor.

R.O.A.D. BC members are concerned this new legislation may not just fail to reduce our insurance rates, it may cost us our ability to be treated as individuals, and to seek out medical, health care and justice advocates to help navigate the daunting process of an injury claim. Thousands of British Columbians are worried this so-called solution gives ICBC even more power and even less accountability, impacting not only our wallets, but potentially our health care as well.

R.O.A.D. BC was formed to raise awareness that injury caps punish those injured in road collisions because injury caps do not take into consideration the fact that every person is unique. Under a caps system, ICBC will treat each injury claim as a number. In actual fact, every person, and their individual situation, is unique.

“Often it is not until months or years after an accident that the true extent of pain, suffering, and/or long-term impairment is clear”, as Craig notes from her experience working with thousands of British Columbians who have been injured from road collisions.

In addition, injury caps disproportionately affect individuals with lower incomes. Challenging a claim under a cap system would cost much more than under the current system, resulting in a scenario where justice may be out of reach for many British Columbians. Bringing in an injury cap system will only serve to harm vulnerable British Columbians while protecting bad drivers – some of whom shouldn’t even be on the road. Rather than strip away the rights of road users, we should focus on collision prevention and education so that there are fewer injuries on BC’s roads.

“Help make a difference in the lives of people across our province”, says Heather Divine of the People in Pain Network, another R.O.A.D. BC coalition member, “Together we can tell ICBC enough is enough and stop the government’s ill-advised plan to let ICBC have even more power and less accountability. It’s not a question about rights versus rates, it’s a question of public interest versus ICBC’s bottom line.”

For more information:

For more information about R.O.A.D. BC and our coalition, please visit the website at https://roadbc.ca where you can also find us on Facebook, Twitter, and YouTube.

For media or other enquiries:

Two factors that may be contributing to ICBC’s poor fiscal performance

According to a report by the Fraser Institute, the combination of an unfriendly environment and “misguided provincial government policies” have contributed to the Insurance Corporation of British Columbia’s (ICBC) dismal financial performance.

Instead of fixing these problems, the current government is allowing ICBC to have even more power and less accountability by introducing injury caps – this is not the solution.

Two factors that may be contributing to ICBC’s poor fiscal performance

Published on April 16, 2018 by Jason Contant

The combination of an unfriendly environment and “misguided provincial government policies” have contributed to the Insurance Corporation of British Columbia’s (ICBC) dismal financial performance, the Fraser Institute said in a new report.

The report, titled The Decline and Fall of ICBC and released on April 5, said that the unfavourable environment arises from a higher frequency and a greater severity of claims. “Higher costs resulting from more vehicles on provincial roads and greater congestion are largely beyond ICBC’s control,” the report’s executive summary noted.

“Some cost pressures, however, may be controllable,” wrote John Chant, senior fellow at the Fraser Institute and the report’s author. “Reduced enforcement may have increased the frequency of accidents, while ICBC’s procedures for assessing property damage claims may have raised the cost of those claims.”

According to Chant, who is also professor emeritus of economics at Simon Fraser University, the current B.C. government recently acknowledged that ICBC was facing a $1.3 billion loss this fiscal year. Last year, it lost $889 million. The report said that total claims increased 61% between 2012 and 2017, and the average cost per policy jumped 40% over the same period. “In the absence of cost containment measures, double-digit rate increases for basic insurance were required to offset the shortfalls,” Chant said in a press release.

Canadian Underwriter asked the government monopoly auto insurer for comment on what was inaccurate in the report, as well as what could be misleading or inaccurate. ICBC provided a statement last week indicating that “the B.C. government and ICBC continues to focus on the urgent task of pursuing significant reforms to our vehicle insurance system.”

ICBC spokesperson Joanna Linsangan said that the changes recently announced – increasing accident benefits and limiting pain and suffering payouts for minor injury claims, which take effect April 1, 2019 – are “intended to make ICBC financial sustainable and are the first critical steps to allow us to keep rates affordable for years to come.”

But Chant wrote in the report that the provincial government’s “rate smoothing mandate” has harmed ICBC’s basic business: mandatory auto coverage. “Without this requirement, ICBC could have raises rates to reflect the increasing costs and, in doing so, preserved its finances. Customers would not have welcomed these rate increases, but they would have saved ICBC from having to make much larger increases in the future.”

The report pointed out that ICBC differs from private insurers “in one important respect:” private insurers can and do fail without substantial impact on the auto insurance market because other insurers can move in to take over their businesses. “Were ICBC to fail, it would be much more damaging because of its size (its annual premiums total over $5 billion) and because it is the only supplier of compulsory (basic) insurance in British Columbia.”

Linsangan noted that public auto insurance ensures that all provincial have the same minimum amount of insurance and insurance benefits, “which protects them as well as all other road users.” As well, the province’s estimated uninsured rate is less than 1% – much lower than other jurisdictions in North America, with rates ranging from 4-20%.

“Our public system also enables enhanced security by enabling the linking of licence plates and decals to a customer’s basic insurance policy,” she said. “This enhancement is unique to only a few jurisdictions in North America and one of the main reasons we have such a low uninsured rate compared to other jurisdictions.”

Read the full story at Canadian Underwriter here.