[{"@context":"https:\/\/schema.org\/","@type":"BlogPosting","@id":"https:\/\/warnetthallen.com\/november-24-2016-icbc-rate-increases-luxury-vehicle-insurance-exclusion\/#BlogPosting","mainEntityOfPage":"https:\/\/warnetthallen.com\/november-24-2016-icbc-rate-increases-luxury-vehicle-insurance-exclusion\/","headline":"November 24, 2016: ICBC Rate Increases and Luxury Vehicle Insurance Exclusion","name":"November 24, 2016: ICBC Rate Increases and Luxury Vehicle Insurance Exclusion","description":"https:\/\/warnetthallen.com\/wp-content\/uploads\/2019\/04\/Kash-Heed-Show-Manjot-Hallen-Interview-2016-11-24-1.mp3 Listen to the interview above or read the full transcript below. Cash: We\u2019ve heard this controversy around ICBC. Not only are they telling you, or they\u2019ve finally agreed to tell at least the BC Utilities Commission and us what the rates are going to be in the upcoming years. We heard government try and […]","datePublished":"2016-11-24","dateModified":"2025-02-12","author":{"@type":"Person","@id":"https:\/\/warnetthallen.com\/author\/warnetthallen\/#Person","name":"Warnett Hallen LLP","url":"https:\/\/warnetthallen.com\/author\/warnetthallen\/","identifier":8,"image":{"@type":"ImageObject","@id":"https:\/\/secure.gravatar.com\/avatar\/05de9a8db316c941221d843d580903732966b9f3f8c338734c57a8535aba495e?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/05de9a8db316c941221d843d580903732966b9f3f8c338734c57a8535aba495e?s=96&d=mm&r=g","height":96,"width":96}},"publisher":{"@type":"Organization","name":"Warnett Hallen LLP","logo":{"@type":"ImageObject","@id":"https:\/\/warnetthallen.com\/wp-content\/uploads\/2019\/04\/logo.png","url":"https:\/\/warnetthallen.com\/wp-content\/uploads\/2019\/04\/logo.png","width":406,"height":65}},"image":{"@type":"ImageObject","@id":"https:\/\/warnetthallen.com\/wp-content\/uploads\/2017\/08\/Manjot-and-Pulse-FM-1.png","url":"https:\/\/warnetthallen.com\/wp-content\/uploads\/2017\/08\/Manjot-and-Pulse-FM-1.png","height":"372","width":"638"},"url":"https:\/\/warnetthallen.com\/november-24-2016-icbc-rate-increases-luxury-vehicle-insurance-exclusion\/","about":["ICBC"],"wordCount":2660,"articleBody":"https:\/\/warnetthallen.com\/wp-content\/uploads\/2019\/04\/Kash-Heed-Show-Manjot-Hallen-Interview-2016-11-24-1.mp3Listen to the interview above or read the full transcript below.Cash:We\u2019ve heard this controversy around ICBC. Not only are they telling you, or they\u2019ve finally agreed to tell at least the BC Utilities Commission and us what the rates are going to be in the upcoming years. We heard government try and block this for a period of time. Of course, they didn\u2019t have any success. We\u2019re looking at a 4.9% increase in our basic premiums this year. We\u2019re also looking at, overall, a 42% compounded rate hike to 2020. Very concerning.Then, we have the ministers thrown out there at this news conference, throws this noise, or wants you to focus your attention away from your 42% rate hike coming up from ICBC and saying, \u201cYou know what? We\u2019re looking after you because we are no longer going to insure vehicles that are $150,000 or more.\u201d Like that\u2019s going to make a big difference. He talked about someone having their trim around the light fixed for $38,000. They want you to go out there and they want you to believe these people. Remember, we have over three million vehicles insured here in the Province of BC. These people, and I think there\u2019s only around 3000, are really going to make a difference because we\u2019re not insuring them, we\u2019re going to have the private insurance companies insuring them.But to talk a little bit more about this and get his opinion, I\u2019m joined by an expert in this area, Manjot Hallen, lawyer specialized in automobile accident claims, personal injury, and he\u2019s a partner at Warnett Hallen LLP. Good morning, Manjot.Manjot Hallen:Hey, good morning Cash. Thanks for having me on the show.Cash:Well, I kinda went on a rant this morning with Neil Morrison about this, and I wanted to get you on. I woke up thinking about this, because I\u2019m listening to Stone on the radio live and I\u2019m going \u201cWhat is he doing? A bunch of noise created because he wants to deflect this away from the issue of rate hikes.\u201dManjot Hallen:Well, Cash, first thing I gotta say is they\u2019re doing something. I mean, $2.3 million in savings, it\u2019s a step.Cash:It\u2019s a drop in the bucket, though.Manjot Hallen:I agree. I mean, there\u2019s a lot more that they can be doing to improve things. One of the things that you and I spoke about the last time I was on the show, is let\u2019s focus on the real issues, like distracted driving. You get rid of people talking on their phones, or texting while they\u2019re driving, and you\u2019re gonna save a lot more than $2.3 million. But in theory, this idea that they have, it makes sense in theory. Look, luxury vehicles, if you can afford a vehicle for more than $150,000, then you shouldn\u2019t require a public insurer to insure that vehicle, and in theory be subsidized by other rate pairers here in British Columbia.So, the logic behind it makes a bit of sense, but you\u2019re correct, it\u2019s only $2.3 million savings, so you need to save a lot more to bring the rates down, and like I said, one of the ways to do that is to end distracted driving and improve the inefficiencies over at ICBC. Discussions that you and I have had in the past.Cash:But we are going to have that 42% rate hike, no matter what mitigation they put in on the luxury vehicles right now, and the question I have on this: are we talking about basic insurance for those luxury vehicles or are we talking about the optional insurance, because this is very different. If they\u2019re opening up the basic insurance, they\u2019re actually opening up a can of worms for other private companies to come in and give you basic insurance.Manjot Hallen:Yeah, I gotta tell you, Cash, I don\u2019t totally understand how they\u2019re gonna save this $2.3 million, because it doesn\u2019t make a lot of sense to me. So let\u2019s give an example for your listeners here. Let\u2019s say I\u2019m driving at the corner of Robson and Granville where my office is, and I\u2019m not driving a Ferrari or Lamborghini. Trust me, I\u2019d love to, but I\u2019m not. I\u2019m stopped at a red light. I get hit from behind. If I get hit from behind and there\u2019s damage to my vehicle and I suffer injuries. Let\u2019s say my claim is worth $10. Now, it doesn\u2019t matter if I\u2019m hit by a Tercel or by a Ferrari, I\u2019m still entitled to $10 from the basic insurance of the vehicle that hit me.I don\u2019t see how that, getting out of the business of insuring luxury cars, presents any savings in that type of scenario. Now, the only way there could be a savings, and again I don\u2019t quite understand this either because where they\u2019re getting the $2.3 million from and of course they haven\u2019t presented us the numbers, but say for example I do have a Ferrari or Lamborghini. I\u2019m one of the fortunate people in British Columbia to be driving a vehicle like that, and I take it out for a spin, and I wrap it around a pole.Now, ICBC has to cover the repairs for my vehicle under my own collision policy, but in theory, the premium that I pay for that collision policy should be a lot higher than the premiums paid by someone who\u2019s driving a Civic.Cash:Yes.Manjot Hallen:So I really \u2026 but what\u2019s happened here, what I assume has happened here, is one of two things. Either the premiums have not caught up with the repair costs, so these people that have been driving the Lamborghinis and Ferraris haven\u2019t been paying the type of premiums they should have been paying all along and that\u2019s where the savings comes in, or number two, the assumption is that people that drive these vehicles are most likely to be at fault for accidents.They\u2019re more likely to be speeding, they\u2019re more likely to be doing something stupid that causes accidents. But, that\u2019s where it doesn\u2019t make a lot of sense to me, the numbers and how they came up with this $2.3 million savings, but if we believe that it\u2019s a $2.3 million savings then it\u2019s obviously, it\u2019s something. It is a savings and they\u2019re taking some measures, at least.Cash:Well, the $2.3 million savings, I\u2019m making an assumption. Now I haven\u2019t seen the actual facts on this either, is it\u2019s around repair costs.Manjot Hallen:Yeah, that makes sense.Cash:That\u2019s what I\u2019m thinking is taking place here, but again, are they saying to these people that have the luxury vehicles and I think in the interim til legislation\u2019s passed when they sit again, they\u2019re going to be paying double the rate that they\u2019re paying right now, but at the end of the day, you have to look at, is it going to make a difference and is it just apply through optional insurance?Because many of the people that already have these luxury vehicles have an optional insurance. I don\u2019t buy my optional insurance from ICBC, I buy it from a private company, and we know, Manjot, these private companies have wanted to come into this to take the monopoly away from the basic side.Manjot Hallen:And certainly ICBC\u2019s opening that up now, aren\u2019t they? Because now if they\u2019re getting out of the business of insuring these luxury vehicles altogether, then private insurers are going to have to insure and provide basic coverage for these luxury vehicles.Cash:Unless they try to have their cake and eat it too, because they have wanted not to have that opened up for other people. They want to maintain that monopoly and you know we are creatures of convenience. If we can go there, if we have to go to get our basic, we\u2019ll most likely get our optional side there too.Manjot Hallen:That\u2019s right. that\u2019s right. Now, what we need to focus on though, Cash, you spoke about the rate increases and how it\u2019s a concern for all citizens of British Columbia, but how do we prevent that? How does ICBC save money? That\u2019s the question we need to be asking ourselves, and I come back to the same couple of topics here.One is distracted driving. It is a massive expense. If we can make distracted driving have the same stigma as impaired driving, then I can assure you we\u2019re gonna save a lot of money on claims. A ton. And that\u2019s one step that ICBC should be taking, they should have a better campaign around distracted driving.Lawyers such as myself and a lot of my colleagues, we\u2019re running campaigns like that. We appreciate this problem. I have colleagues of mine that are speaking at high schools. My firm sponsors the Drop it and Drive Canada. These are the types of initiatives we need to take to ensure that insurance premiums don\u2019t spiral out of control. And the other big issue is the inefficiency of ICBC, the topic that you and I have discussed at length.Cash:And that\u2019s concerning, because I\u2019m not sure what ICBC\u2019s actually doing. They\u2019re not really allowed to operate as strictly just a crown corporation and not have political interference. We\u2019ve seen that political interference, I\u2019ve witnessed it firsthand, where the government is actually taking money out of the corporation and putting it into their general revenue to make government look more appealing, and that is, they call it a dividend or something of that nature.Well, they\u2019ve drained the company so much that they can\u2019t take a dividend out anymore, but at the same time they cannot mitigate the increase of 42% til 2020 simply because they don\u2019t have this money built in. You would think as a corporation they\u2019d operate as a corporation and mitigate the raise in premiums because of the money they have, but that\u2019s not taking place.Manjot Hallen:Absolutely, and you make a good point. If they\u2019re a corporation in name, they should act like a corporation in theory, and we don\u2019t see a lot of that. You should see some of the things I see over here, Cash.Cash:Well, I know.Manjot Hallen:And I\u2019ve discussed with you previously, it\u2019s nuts.Cash:It\u2019s incredible \u2026 this is what I\u2019m saying, is they\u2019re not acting responsibly, Manjot, because even when they have people that have suffered as a result of a motor vehicle accident, they put them through the rigamarole for something that they need compensation for, and they do that based on some simple policy, not based on whether they will have legal success or success in this area, or not.Manjot Hallen:Exactly, I mean if everyone knows that this claim is worth $10, why end up paying $10 and $5 in legal fees? That\u2019s what ICBC ends up doing. They end up paying $15 when they could have settled that claim for $10. That\u2019s the issue, that\u2019s where the inefficiency\u2019s coming, and obviously I\u2019m using an example of $10, the claims are usually more than that, but in a nutshell, why pay all this money to defend a claim and end up settling it for the exact same amount that you could have settled for prior to trial?Cash:At great expense, great expense to the taxpayer.Manjot Hallen:Exactly.Cash:To the people that, and it\u2019s the taxpayers. It\u2019s 3 million vehicles that are insured here, they\u2019re the taxpayers having to pay this increase, a 42% increase. I\u2019ve gotta ask you, Manjot, do you think that the key to this, and we talked about distracted driving, impaired driving, all of that, is prevention, taking preventative approaches like Manjot Hallen is doing, or Warnett Hallen is doing in the schools right now, in sponsoring the Drop It program, or do you think it\u2019s going to be deterrence or a bit of both? You know, that punishment, the fine, the large fine.Manjot Hallen:You know, it\u2019s gotta be a bit of both. It\u2019s gotta be a bit of both, Cash. I mean, look, we can only do so much in educating the youth, in particular, to stop using their devices when driving. The other side of it has got to be heavier fines.The government\u2019s taken steps in the right direction, they have increased the fines recently, but we need to see more. We need to see more done in that regard, and as a culture as well, we\u2019ve gonna think differently about distracted driving. As I said to you in the past, when you\u2019re out and about, you\u2019re at a bar with your friends, every one of your friends is gonna ask you before you drive, \u201cAre you okay to drive? I saw that you had a beer,\u201d or a beer and a half, or whatever the case may be. Most of your friends are gonna ask you that question.You\u2019re sitting on your phone all night, fighting with your wife or your spouse, nobody cares to ask you on those nights, \u201cAre you gonna be okay to drive? I saw you on your phone all night long. I want to make sure that you\u2019re not gonna be using your phone while you\u2019re driving.\u201d People don\u2019t have those discussions, and we need to change our mindset as a community around this issue. We need to attach the same stigma to distracted driving as we attach to impaired driving. That\u2019s the only way to end it.Cash:And that starts with our youth.Manjot Hallen:It does, absolutely.Cash:So (\u2026) Warnett Hallen for sponsoring that program in our school system, because we need to get more of that information out to our youth, because in the long run we are going to benefit from this, but in the short term I gotta tell you, Manjot, this 42% rate hike for the next few years that we\u2019re going to have to pay, it\u2019s a compounded rate hike, I believe we\u2019re going to have to pay it. I believe ICBC is going to try and our government is going to try and create noise around this increase in a way that you\u2019ll say \u201cOkay, these people that are driving these Ferraris, BMWs, whatever, are the ones that are driving up your rate. You point out a very good thing. There\u2019s other areas that government really needs to focus on.Let\u2019s take that $2.3 million, if we can understand it a little bit better, and say okay, we\u2019ve got one point here but there\u2019s much more reward, or benefit that we can obtain, with these other initiatives.Manjot Hallen:That\u2019s right. Absolutely.Cash:Manjot, thanks for taking time out of your day. I know I sprung this on you suddenly this morning and it\u2019s great to get your perspective on this, and other areas around automobile accident, personal injury claims, and other areas. I\u2019m gonna hit you up, I\u2019m gonna talk to Amber right now, want to get you back on because I want to talk to you about this youth problem that we\u2019re having too, to get your perspective on this.Manjot Hallen:Great. Thanks, Cash.Cash:Have a great day, Manjot.Manjot Hallen:You too."},{"@context":"https:\/\/schema.org\/","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"November 24, 2016: ICBC Rate Increases and Luxury Vehicle Insurance Exclusion","item":"https:\/\/warnetthallen.com\/november-24-2016-icbc-rate-increases-luxury-vehicle-insurance-exclusion\/#breadcrumbitem"}]}]