Photo: Glacier Media

After more than two years’ work trying to overhaul ICBC's balance sheet, the provincial government has proposed a new plan to overhaul the insurer.

The new no-fault “Enhanced Care” system proposes higher care, treatment and income benefits, funded by a significant reduction in legal costs. Underpinning that is a promised shift from an adversarial and defensive culture at ICBC to one that prioritizes the care of all British Columbians injured in a motor vehicle accident, regardless of fault.

Under the current system, ICBC projects it would pay $960 million in legal costs and $940 million in injury claim settlement costs in 2022. The new system – slated to take effect in May 2021 pending legislative approval – is expected to reduce legal costs to $100 million and settlement costs to $130 million – decreases of nearly 90% and 86%, respectively.

But critics take issue with how the provincial government plans to fund ICBC’s Enhanced Care.

“The government started by announcing all the things that the system would give them, but what they didn’t address were all the things that the new system was taking away,” said Shawn Mitchell, executive director of the Trial Lawyers Association of BC.

Things taken away include the majority of ICBC’s payouts for pain and suffering, which recognize an accident’s less tangible impacts, such as inconvenience and emotional distress, along with the ability to sue another insured for additional compensation – with some exceptions – and the ability to sue ICBC if it does not administer the benefits an insured is entitled to.

“We are going to leave you with the inability to have representation in dealing with one of the most unpopular Crown corporations in the province, with a terrible track record of customer service and care, and these are now the people who are going to provide you with your primary access to financial support to aid you in accessing funds for your physical care,” said Mitchell. “It’s a little grim.”

Chuck Byrne, executive director of the Insurance Brokers Association of BC, said that greater allowances for care and new permanent impairment compensation will compensate for a lot of the same things, even though the definitions differ from those of pain and suffering. ICBC’s proposed impairment compensation would award a maximum amount of $250,000 for injury impairments that last a lifetime.

Byrne added that IBABC brokers are “very, very happy” with the changes, which in their view will be of long-term, sustainable benefit to the motoring public.

According to the provincial government, British Columbians will be able to address concerns about ICBC through ICBC’s fairness commissioner, the B.C. ombudperson or the Civil Resolution Tribunal, which has served as the default jurisdiction for motor vehicle accident and injury claims of up to $50,000 since April 1, 2019.

Ken Armstrong, president of the Canadian Bar Association British Columbia Branch and managing partner of Armstrong Naish Trial Lawyers, called the government’s proposed restrictions around legal recourse “fundamentally wrong.”

“Their spin of course is going to be their spin. This system will not allow people to bring actions in the court if ICBC doesn’t provide the benefits they think they’re entitled to,” he said. “We’re denying citizens the right to challenge a government authority’s exercise of its discretion before the courts.”

He added that CBABC “wholeheartedly reject[s] the government’s implication that this change will result in savings for motor vehicle accident victims, who far too often are offered settlements intended to save ICBC money.”