NDP proposal puts profits over people

It’s Mental Health Week, yet David Eby’s decision to minimize the impacts of psychological or psychiatric conditions arising from collisions is a major step in the wrong direction.

NDP proposal puts profits over people

Published May 7, 2018 by Neil Godbout

Imagine if you were the truck driver involved in last month's horrific crash that killed 16 people on the Humboldt Broncos hockey team bus.

Or imagine if you were one of the first responders on the scene.

The likelihood of those people suffering from post-traumatic stress disorder (PTSD) and other psychological effects requiring extensive and ongoing medical treatment is high.

Yet drivers and first responders could be treated completely different under proposed legislation.

If Cariboo-Prince George MP Todd Doherty's bill gets through committee in the Senate and is brought into law, Canadian first responders will get the attention they need to help cope in the aftermath of such tragedies.

Meanwhile, if the B.C. NDP successfully redefines the kinds of injuries ICBC is willing to pay after vehicle accidents, all psychological and psychiatric conditions connected to a crash will be deemed a "minor injury."

The B.C. Psychological Association is sounding the alarm on this ridiculous and potentially harmful change.

The government is defining a psychological and psychiatric minor injury as any condition that is resolved within a year of the accident and meets other criteria which they have not bothered to define yet, much like the proportional representation referendum question.

As the association rightly points out, the 12-month timeframe is an arbitrary limit not connected to health outcomes.

"The duration of symptoms after an event is not an appropriate scientific measure of the severity of the psychological injury," the association says.

Furthermore, this flies in the face of the medical literature which clearly shows that "psychological injuries are not minor injuries," much like concussions.

Each individual and each circumstance is different when it comes to symptoms and their severity.

Other factors, such as the extent of physical injuries sustained in the crash, pre-existing medical conditions and cultural background, also play a role.

As Darby Allen, the now-retired Fort McMurray fire chief told a Prince George audience during last month's Bob Ewert Dinner and Lecture, his own issues with depression and anxiety didn't manifest themselves until months after the worst of the fire.

And as anyone who continues to deal with mental health issues knows, people can feel better and be symptom-free but then relapse at a later date, just like cancer and many other physical conditions.

The NDP government has created an appeal process through the Civil Resolution Tribunal but the psychological association doesn't believe that's fair.

"Those suffering from psychological conditions are ill-equipped to deal with an appeal process on their own. It is also unlikely that many of those people will be able to have the assistance of a lawyer in this process," the association says.

"This process, online and/or in person, also puts at a disadvantage the elderly, people without computers or computer skills, those with poor English language skills, and those of limited means."

If the government cares more about the health of accident victims (often the same people paying the insurance premiums) and less about ICBC's profitability, the "minor injury" designation is unnecessary since the most important result (and cheapest solution) is timely treatment and recovery for those affected.

Psychological conditions brought on by vehicle accidents don't care who is at fault or to what extent.

In the case of the truck driver in the Humboldt crash, he deserves care for his physical and psychological injuries from the crash, regardless of the degree to which he may (or may not) be at fault.

Home insurance companies don't get to walk away from negligent homeowners who lose everything after they accidentally forgot to shut the stove off, nor should vehicle insurance companies get to do the same to drivers.

The provincial government doesn't worry much about home insurance because it isn't in that business but it wants to set terms on vehicle insurance because it owns the provider, an obvious conflict of interest.

Instead of letting the doctors, the lawyers, past precedent, the marketplace and what's right for the affected individuals dictate the outcome, the NDP jumps in because it knows what's best for everyone and will impose it on them, whether they need it or not.

If the NDP were still in opposition and the B.C. Liberals had decreed that psychological conditions resulting from vehicle crashes were minor injuries, John Horgan would have rightfully called the government heartless for putting profits over people and the insurance company ahead of the drivers paying the premiums.

There are plenty of problems with ICBC for Horgan and the NDP to fix.

This proposed change is just another problem, not a solution.

-- Editor-in-chief Neil Godbout

Read the full story at the Prince George Citizen here.


ICBC injury cap could punish victims instead of bad drivers: advocates

Those injured on BC roads as the result of reckless driving by bad drivers will only be victimized again by David Eby’s new injury cap legislation.

ICBC injury cap could punish victims instead of bad drivers: advocates

Published Sunday, May 6, 2018 by CTV Vancouver

As the province's public auto insurer undergoes its biggest overhaul in decades, some feel a part of the plan will penalize victims instead of bad drivers.

With more drivers on B.C. roads, the collision rate across the province is soaring. Nearly 900 crashes happen every day, and minor injury claims are on the rise.

These claims are among the factors blamed for the Insurance Corporation of B.C.'s projected $1.3 billion shortfall this year, along with legal costs and car repairs.

So in February, the province unveiled the most drastic overhaul of ICBC in decades, including a controversial cap on minor injury claims.

"We hope and are advised that this legislation might get ICBC back into the black, which means that the savings are in the neighbourhood of $1 billion," Auditor General David Eby said in February.

But demonstrators protesting the changes on Saturday said the savings come at a high cost.

"They're going after the victims instead of going after the bad drivers, so it's going to impact all of us," one of the protesters said.

The rally was hosted by the Trial Lawyers Association of British Columbia and Rights Over Arbitrary Decisions for British Columbia, and held outside the Surrey office of MLA Jenny Sims.

The group has also published a petition asking the NDP government to reverse its decision on injury claim caps. As of the afternoon of May 6, it had been signed nearly 19,600 times.

Critics say the $5,500 cap on pain and suffering payouts for minor injuries, which will come into effect next year, isn't enough. Their concern is that victims of bad drivers will only be victimized again by the new legislation.

Babs Baird is still living with the effects of a soft tissue injury that developed months after her vehicle was rear-ended in 2015.

"I used to be riding horses, snowshoeing, biking, hiking… It's all gone. I can't do it anymore."

She said physical injuries like hers, as well as mental health issues that be triggered by crashes, can linger long after settlements.

"All of the stress and the pain that you go through… I don't think $5,500 is fair enough."

Baird and others gathered this weekend are calling on the province to change the rules before they take effect in April.

Read the full story via CTV Vancouver here.


British Columbia Psychological Association opposes the classification of psychological and psychiatric conditions as “minor injuries” in ICBC legislation

"Under Bill 20, any psychological or psychiatric condition arising from a motor vehicle accident is deemed to be minor." We join the BC Psychological Association in their opposition, as it will be detrimental to the health and care of British Columbians who sustain injuries in motor vehicle accidents.

British Columbia Psychological Association opposes the classification of psychological and psychiatric conditions as “minor injuries” in ICBC legislation

VANCOUVER, British Columbia, May 04, 2018 (GLOBE NEWSWIRE) -- The British Columbia Psychological Association opposes the inclusion of “a psychological or psychiatric condition” in the definition of “minor injury” in Bill 20. We feel it will be detrimental to the health and care of British Columbians who sustain injuries in motor vehicle accidents.

Under Bill 20, any psychological or psychiatric condition arising from a motor vehicle accident is deemed to be minor, unless it has not resolved within 12 months from the MVA, and also meets, as yet undefined, prescribed criteria.

BCPA disagrees and takes the positions that:

Psychological injuries are not minor injuries. Each individual is unique in their symptoms.

It is very difficult to determine the twelve-month outcome of a psychological injury as it may be affected by pain, restrictions in functioning due to physical injuries, and pre-accident history, including prior history of depression, anxiety, substance use, adverse early childhood experiences, including neglect and trauma, poor coping styles, and cultural factors.

The duration of symptoms after an event is not an appropriate scientific measure of the severity of the psychological injury.

Psychological conditions may arise at different times after a collision, depending upon a number of factors. Many potentially severe psychological conditions, such as post-traumatic stress disorder, depression, and anxiety, may have an initial onset shortly after, or months after, a collision.

Psychological conditions may appear to resolve, only to recur at a later date due to a change in circumstance, prolonged recovery, or a triggering event such as a return to work, a return to driving, or anniversary of the collision.

Bill 20 gives Government the authority to make regulations with respect to assessment, diagnosis and treatment of minor injuries (including psychological injuries). Because of the unique circumstances of each individual, psychological injuries do not lend themselves to such an approach. Each individual must be assessed by a qualified psychology professional and prescribed the treatment that will best lead to an optimal recovery for them.

If the appropriate treatment is not commenced as psychological symptoms manifest, it may lead to prolonged suffering, delayed return to work, impaired activities of daily living, and in increased treatment and wage loss costs in the long run.

Removing psychological and psychiatric conditions from the “minor injury” designation will help achieve the goal of people receiving better care and optimal recovery in the shortest time possible.

BCPA is also concerned with the proposed amendments to the Civil Resolution Tribunal Act.

Under the Act, the determination of whether an injury is “minor” and the entitlement to benefits from ICBC, is exclusively given to the Civil Resolution Tribunal.

Those suffering from psychological conditions are ill-equipped to deal with an appeal process on their own.

It is also unlikely that many of those people will be able to have the assistance of a lawyer in this process.

This process, online and/or in person, also puts at a disadvantage the elderly, people without computers or computer skills, those with poor English language skills, and those of limited means.

BCPA applauds this government’s efforts to address the mental health and addictions issues of British Columbians, but classifying psychological and psychiatric conditions as “minor” runs the risk of taking a step back in the treatment of psychological injuries arising from a car accident.
About BC Psychological Association
The British Columbia Psychological Association (BCPA) and its members are committed to supporting the emotional health and psychological well-being of British Columbians. BCPA believes that all British Columbians deserve access to high-quality, clinically proven psychological care provided by Registered Psychologists.

For more information, contact:
Rick Gambrel
Executive Director
British Columbia Psychological Association
604-730-0501
rick.gambrel@psychologists.bc.ca


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:
info@roadbc.ca


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.

 


B.C. government continues spending on advertising, despite financial pressures

Front page of today's Vancouver Sun! The BC Government is spending almost $800,000 of your hard-earned tax dollars to convince you that it’s good they are taking your rights away.

Tell your MLA that this isn't okay.

Sign the petition right now at: https://roadbc.ca/petition and defend the right to fair compensation for drivers, passengers, cyclists and pedestrians.

B.C. government continues spending on advertising, despite financial pressures

Published on: March 12, 2018 by Rob Shaw

VICTORIA – The B.C. government is spending almost $4.5 million to advertise the provincial budget, electricity conservation programs and auto insurance changes, despite being sharply critical of such “propaganda” publicity campaigns by the previous Liberal government.

The government has budgeted to spend up to $600,000 to promote last month’s provincial budget, through radio, newspaper and social media ads. As well, B.C. Hydro is spending $3 million on an energy conservation awareness campaign, and the Insurance Corporation of B.C. is spending $795,000 to explain new government-ordered caps on pain and suffering in minor injury claims.

The advertising campaigns from the two Crown corporations come at a time when government ministers have described Hydro’s finances as a “mess” and ICBC as a “dumpster fire.” Both Crown corporations are facing significant pressure to hike rates, with ICBC on track to lose $1.3 billion this year and Hydro unable to freeze rates after the independent power regulator ruled this month that it couldn’t afford to lose the revenue. The government is in the middle of operational reviews of both corporations to try and find savings.

The financial problems in both Crown corporations presents a major risk to the NDP government’s fiscal plan, Finance Minister Carole James said last month. The provincial government is also short of revenue for its housing, child care and health spending, so it raised or introduced several new taxes in order to generate hundreds of millions of dollars this coming fiscal year.

But the financial pressures don’t appear to have diminished government’s desire to spend large sums of public money on advertising its political message, a tactic exploited most recently by the previous B.C. Liberal government. The $600,000 earmarked to promote awareness of the NDP’s February budget compares to $663,000 spent by the Liberals to advertise their February 2017 pre-election budget. “Some programs like Pharmacare and the new affordable child care benefit will require people to apply for them, and that’s why we’re making sure to let people know,” James said in a statement. “For example, 240,000 people will have better access to prescription medicines as a result of the Pharmacare investments we made in this budget.”

Premier John Horgan used to complain bitterly about the Liberal government’s advertising spending during his tenure as leader of the Opposition. Just months before the 2017 election, he dubbed then Liberal cabinet minister Andrew Wilkinson the “minister of propaganda” for raising government’s annual advertising spending from $8.5 million to $15 million.

“How many services would this government be able to provide to British Columbians if it cut back on the propaganda and started delivering programs?” Horgan said in the legislature at the time.

Now in power, the NDP budget last month projected approximately $11 million in central government advertising for the coming fiscal year, not counting Crown corporations like ICBC and Hydro.

The NDP in opposition three times tabled private member’s legislation that would have required government advertising to first get the approval of the independent Auditor General as non-partisan and factual. “We’ll start by ending waste on Christy Clark’s partisan government ads,” read the party’s 2017 election platform. “We’ll work with the auditor general to set strong standards for advertising spending.”

James said involving the auditor general is still being considered as one possibility. “We haven’t made a determination about what the best route is yet, but we’re still looking at that,” she said.

Liberal house leader Mary Polak said the ad spending and quiet backtrack away from the auditor general is another example of the NDP failing to deliver on its election promises. “That was a pretty clear commitment from them,” said Polak. “If they wanted them to vet ads they could be doing it already. They said it was a good idea, why would it suddenly not be when they are in government?”

Hydro’s advertising includes a TV and social media campaign involving a bearded energy conservation enthusiast who helps residents save electricity by showing them tricks, such as putting a towel in the dryer with their wet clothes to speed up drying time.

“We offer a number of conservation programs and different types of billing support,” said Hydro spokesperson Mora Scott. “Our goal during these campaigns is to raise awareness about the programs we offer and provide tips on how customers can reduce their electricity use to save money on their bills.”

Hydro said it is spending half of what it spent on advertising campaigns in 2010. However, the ads don’t promote awareness of the NDP government’s new plan for lifeline rates or grants for those suffering financial hardship, which the government announced last month following the B.C. Utilities Commission rejection of its plan to freeze Hydro rates for one year.

The BCUC said Hydro could not afford the $140-million cost of the freeze, which was an NDP election promise, because Hydro is facing more than $6 billion in deferral accounts yet to be repaid. “They were very clear in a nutshell that there’s a mess at B.C. Hydro,” Energy Minister Michelle Mungall said in response to the ruling at the time. “It needs to be cleaned up and I hear that.”

ICBC’s advertising is focused on the $5,500 cap on pain and suffering claims for minor injuries, announced by Attorney General David Eby last month. Eby has called ICBC’s finances “a dumpster fire” because it is haemorrhaging money due to rising injury claims, crash rates and legal fees. His reforms are part of a larger multi-step plan to reform how ICBC offers, sells and charges basic automobile insurance. ICBC said it felt compelled to advertise those changes. The campaign does not cover ICBC’s activation of red light cameras to ticket speeders.

“This announcement focused on the biggest overhaul of ICBC’s product and B.C.’s auto insurance system in decades so we felt it was important to get accurate information out to our customers and all interested parties through all channels possible and in multiple languages,” said spokesperson Adam Grossman. “This was especially important to ensure accurate information is available regarding the changes to accident benefits and the cap on pain and suffering payouts for minor injury claims.”

Early in its tenure the NDP attracted criticism for hiring its party videographer to a government communications job, and then producing a set of taxpayer-funded online government ads that used the same “Better B.C.” tagline the NDP used during its election campaign, featuring people thanking the NDP government for honouring its campaign promises.

The Liberals were also rapped by the auditor general in 2017 for public advertisements considered too partisan.

Read the full story in The Vancouver Sun: http://vancouversun.com/news/politics/government-continues-spending-on-advertising-despite-financial-pressures


Opinion: Don’t kill ICBC, the goose that lays golden eggs

Attorney General David Eby's short-term fix to ICBC's problems — a cap on soft-tissue injury claims — does not address the larger problem, that the BC government has been raiding ICBC's coffers for years, and has not been fully transparent about the implications.

Opinion: Don’t kill ICBC, the goose that lays golden eggs

Published on February 23, 2018 by Richard Littlemore

Just to be contrary, I’d like to suggest that the Insurance Corp. of B.C. — characterized so recently by Attorney General David Eby as a financial dumpster fire — is actually a valuable public asset, and one that British Columbians would embrace if they realized the extent of its contribution. The problem, which Eby only partly diagnosed, is that ICBC’s political masters have abused the corporation so badly that it’s in danger of losing all public support.

To review the recent, hysterical narrative, ICBC is the monolithic public auto insurer with which we all must deal. And it appears to be badly run; at least, that might seem a fair conclusion when a once-profitable monopoly threatens a deficit of $1.3 billion.

Clearly, the shortfall is a problem, and I’ll leave it to the lawyers and actuaries to debate whether Eby’s short-term fix — a cap on soft-tissue injury claims — is a sufficient short-term solution. But the larger problem (if you’ll forgive a farmyard full of metaphor) is that the B.C. government has been treating ICBC as both a cash cow and a workhorse, and being less than fully transparent about the implications.

On the cash cow front, provincial politicians have been milking ICBC for years, sucking a net $2.1 billion into general revenue in the last decade alone. Christy Clark and Gordon Campbell’s Liberals loved this tactic; they helped balance the provincial budget by demanding dividends from Crown corporations.

(Even worse, the Liberals accumulated off-the-books debt in the same way — drawing more than $5 billion in dividends from B.C. Hydro even as that organization hemorrhaged money in ill-considered capital projects. Because the resulting shortfall appeared only on B.C. Hydro accounts, Clark’s Liberals were able to claim that they were balancing the provincial books and protecting B.C.’s credit rating, even while piling up profligate debt levels at Hydro.)

On the workhorse front, the provincial government uses ICBC to run all provincial licensing services, thus covering an expense that would fall on provincial taxpayers if B.C. had a private insurance regime. It’s difficult to tease those expenses out of the ICBC budget, but it’s easy to see how much ICBC collects in licensing fees and fines: last year, it took in $572 million — which also went directly into provincial coffers.

So, ICBC customers pay all auto-related administrative costs, while government spends the revenue, not on auto insurance claims or even, necessarily, on transportation-related investments. In fact, ICBC pays for some of those, too. Last year alone, the corporation spent $41 million in “road improvements and traffic safety programs” and more than $50 million in “road safety and loss management services.”

None of this is bad, necessarily. It makes sense for an insurance monopoly to spend small sums fixing dangerous street corners when those improvements will reduce accidents and cut insurance claims by a larger amount. It makes sense for an insurance monopoly to manage licensing and fines, creating a single, helpful service point for administration and enforcement (if you don’t pay your fines, you don’t get your insurance). Such efficiency would never be available in a private insurance environment.

But it doesn’t make sense for taxpayers to reap billions of dollars in good times and then condemn ICBC when claims go up. Imagine how much better the corporation would look if that $2.1 billion was sitting in retained earnings, ready for this rainy day?

Longtime ICBC watchers will recall the short, impressive tenure of the late Nick Geer, a senior executive to Jimmy Pattison who the Campbell Liberals recruited in 2001, ostensibly to privatize auto insurance. No ideologue, Geer studied the business and concluded that privatization would be a mistake: the system works.

But government interference has since endangered ICBC’s solvency and a lack of transparency has undermined public support. The current government has a chance to fix that – and the fate of a worthy enterprise hangs in the balance.

Read the full story in The Vancouver Sun: http://vancouversun.com/opinion/op-ed/opinion-dont-kill-icbc-the-goose-that-lays-golden-eggs