FACT: Insurers provide car insurance within a strict framework of provincial laws and, because of that, insurance systems cost what they cost whether they are owned by government or the private sector.
Premiums in provinces where insurance is delivered by private companies are competitive with premiums in those provinces that have government-run auto insurance systems. However, when it comes to what consumers get for those premiums, the people in the privately run insurance systems are better protected with richer benefits and higher claims payouts.
Government insurers also change rating territories as a way of increasing rates for consumers without applying for a rate increase. Rating territories have been changed in BC frequently in recent years. In November 2002, ICBC made a number of dramatic changes to its rating territories and moved thousands of motorists into higher-priced territories. This resulted in these motorists’ rates increasing dramatically, some by as much as 30%. These are the kind of backdoor rate increases given to the public by government-run auto insurers who have had their “front-door” rate increases capped or limited by regulations or the politics of an election campaign.
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