Province to pull $500m out of ICBC over three years

Flow of profits to Victoria continues as auto insurance rates set to rise

ICBC expects to shovel nearly half a billion dollars in profits into provincial government coffers over the next three years, according to budget documents.

Although the public auto insurer intends to raise basic insurance rates 11 per cent, its service plan shows it will also turn over $181 million in profits to the government in 2012, $165 million in 2013 and $151 million in 2014.

That money – $497 million – is considered excess to ICBC’s capital requirements on the optional insurance side of its business and therefore unrelated to the need to jack basic rates to keep pace with rising claim costs.

Add in transfers in 2010 and 2011 and the province will have taken nearly $1.2 billion out of ICBC by 2014.

Critics argue the money should be returned to ratepayers.

“They’ve created pools of money that they can extract at will,” said Bruce Cran, president of the Consumers Association of Canada. “It was never meant to be this way.”

The planned increase on basic rates would be partly offset by a premium cut on optional insurance, resulting in a net increase of $27 a year for a typical customer.

Conservative leader John Cummins called the hike a “stealth tax” on motorists in light of the flow of profits to Victoria.

Jordan Bateman, B.C. director of the Canadian Taxpayers Federation, said it’s unfair that taxpayers in general benefit from ICBC charging ratepayers too much.

Bateman said he would prefer to see more competition for car insurance, provided it is regulated.

Bateman said the province is also relying too heavily on the cash it takes from B.C. Hydro and from gambling profits of the B.C. Lottery Corp.

“The government has not been able to wean itself off of these Crown corporation revenues,” he said.

Just Posted

Fundraiser for teenager hit by car in Rosedale

Teen suffering multiple fractures and blood clots following incident on Yale Road

Vedder River cleanup nets bag of discarded sex toys

Chilliwack volunteers stumble on unexpected find while removing 600 lbs of trash from riverway

Hikers alert after woman approached by suspicious man in Harrison Mills

The woman and her family were hiking in the wetlands between Rowena’s Inn and Sts’ailes First Nation

Chilliwack International Spring Film Series returns to Cottonwood 4 Cinemas

Put a spring in your step with the Chilliwack International Spring Film Series’ feature titles

EDITORIAL: No think-tank report cards for the Observer

Fraser Institute’s annual school ranking isn’t a good measure of success, editor Grace Kennedy writes

Film crews descend on Agassiz for ‘Republic of Sarah’

Pioneer Avenue will be closed to traffic Monday and Tuesday

Father-son duo at B.C. Children’s Hospital helps new dads fight depression

The pair teamed up to introduce the only known research-based mindfulness workshop for new dads

Mexican restaurant in B.C. told to take down Mexican flag

General manager of Primo’s Mexican Grill in White Rock: ‘I’ve never heard of anything like this’

B.C. NDP moves to provide tax credits, tax cut for LNG Canada

Provincial sales tax break of $596 million repayable after construction

COLUMN: Smart phone too powerful a tool to yank from students’ hands

Rather than ban them from schools, let’s teach kids to harness their phone’s power and use it properly

Trudeau sells housing plan in visit to hot real estate market in B.C.

Trudeau said the budget contains measures to help first-time buyers

Norway opens probe into why cruise ship ventured into storm

The Viking Sky was headed for southern Norway when it had engine problems on Saturday afternoon

Crash threatens Vancouver shipyard’s schedule for new coast guard ships

The delivery of the vessel was already years overdue

Fired B.C. farmland commission chair backs NDP rule changes

Richard Bullock agrees with Lana Popham, ALC records don’t

Most Read