No-fault ICBC insurance legislation light on details, heavy on cabinet orders

ICBC headquarters in North Vancouver.

Mark van Manen / PNG files

VICTORIA — Attorney General David Eby has unveiled the legislation necessary to dramatically overhaul auto insurance in B.C., though in many cases it leaves key details to be decided later by government.

Eby tabled Wednesday the enabling bill required to convert the Insurance Corp. of B.C. to a new, no-fault auto insurance system on May 1, 2021. The 47-page bill in dozens of instances points to regulations yet to be developed by cabinet, and which won’t be debated by MLAs in the legislature, leaving unclear large swaths of details in what is the most significant change to ICBC since its inception four decades ago.

Eby said it was a deliberate strategy to give government flexibility to set the proper benefit levels, rates and rules after meeting with health-care representatives in the coming months.

“It was very important to me and to government that this care-based system be directed by people who have experience in the area, whether it’s practitioners, or as people who have experienced a disabling accident and they’ve had to live with it,” Eby said. “And these are the folks who know best about what benefits should look like, and how they should be delivered. There are questions that need to be answered.”

Wednesday’s legislation is “a framework” for how no-fault insurance will work, said Eby.

“There is a lot of content to the bill and there are key parts in there to provide assurances to British Columbians that what we mean what we say,” he said. “When we say $7.5 million (maximum benefits) that’s in the bill. It’s set out in the language of the law so people know that is a serious thing.”

No-fault insurance means people involved in vehicle crashes can no longer sue for damages — except in cases involving court convictions for offences like negligence, street racing, impaired driving or in cases of faulty manufacturing, botched repairs and the over-service of alcohol by a business.

Instead, people will receive benefits, payments for medical treatment and compensation directly from ICBC, using amounts set by the province depending on the type of injury.

Opposition Liberal critic Jas Johal said the no-fault legislation simply creates a bigger, bureaucratic ICBC where injured people have little say in their recovery.

“This legislation does nothing to address the core challenge facing B.C. residents, which remains astronomical ICBC rates,” he said. “The NDP priority seems to be preserving a 46-year-old state run monopoly, rather than finding ways to dramatically reduce rates.”

The switch will upend B.C.’s litigation-based insurance model, in the process saving ICBC an estimated $2.9 billion in legal fees and pain, suffering and injury claims in 2022. That will result in an average 20 per cent reduction to ICBC insurance premiums in 2021, the Crown corp. estimates.

ICBC said the increase in maximum lifetime benefits to accident victims — to $7.5 million from $300,000 currently — will help those seriously injured get access to rehabilitation, care aides and supports for as long in their lives as needed.

Justina Loh, executive director of Disability Alliance B.C., said she supports the move: “We’re glad that there’s going to be more support and that people can access up to $7.5 million in benefits.”

But she acknowledged not everyone is pleased.

“In the disability community it’s a bit divided, meaning some people are feeling a bit more concerned about the changes,” she said, referencing brain-injury advocates as an example. “Some groups are feeling more concerned, and others are just waiting to see what happens.”

Wednesday’s legislation did spell out a legal “duty” for ICBC to advise people of benefits and ensure they receive all their entitled amounts. However, critics say it’s hard to trust ICBC to provide proper benefits when the Crown auto-insurer is facing immense political pressure to stem its financial losses.

“Minister Eby has made clear, and British Columbians have acknowledged, they’ve lost trust in ICBC, but today we’re being asked to put our lives in their hands,” said Aaron Sutherland, vice-president of the Insurance Bureau of Canada, which represents private auto-insurers. “British Columbians should be concerned about that.”

The Trial Lawyers Association of B.C., which is expected to launch a court challenge against the no-fault legislation, said Wednesday it’s still reviewing details of the bill.

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