Big changes to car insurance kick start Monday

Major changes to B.C.'s auto insurance industry come into effect Mondayas part of the province's attempt to stop ICBC from bleeding money.

The new rules include a $5,500-cap on pain and suffering payouts for crash victims withminor injuries, such as whiplash, sprains or strains.

Small settlement cases are being moved out of courtrooms and will now be heard by the Civil Resolution Tribunal.

The B.C. government also aims to trim ICBC's bloated legal bills which make up nearly a quarter of the corporation's total annual costs by limiting the number of experts who can file reports in settlement cases.

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B.C. Attorney General David Eby says the measures will help cut ICBC's losses from $1.3 billion in the2017-18 fiscal year to $50 million in 2019-20.

Minor injuries

B.C. is the last province in the country to introduce limits on pain and suffering compensation for people who sustain minor injuries in crashes.

Medical bills, legal costs and lost wages due to minor injuries fall under a separate category, so they're not affected by the cap.

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Richard McCandless, a former civil servant who has written extensively about ICBC, says the change should have been made years ago.

"We should have moved away from it years ago when Alberta did, for example, back in 2004," he said. "It just became too expensive."

The cost of an average claim was just over $8,000 in 2012, according to figures from ICBC. By 2016, the number rose to more than $30,000 and the average payout for pain and suffering for minor injuries was $16,500.

Civil ResolutionTribunal

The Civil ResolutionTribunal, which currently resolves strata disputes and other small claims issues, will now also take on ICBC settlement disputes of $50,000 or less.

If a crash victim has a dispute with a settlement offer from ICBC, they can fill out a form online and have their case resolved by a CRT adjudicator instead of a judge.

The province argues the CRT will handle cases more quickly and the streamlined process will make hiring lawyers unnecessary for many plaintiffs.

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McCandless says if plaintiffs don't hire lawyers, ICBC will save a bundle on legal fees, too.

"The whole idea is to try and get lawyers out of the business," he said. "They're going to save a ton of money."

Many lawyers are critical of the new system, saying the new measures make it harder for crash victims to get fair compensation for their injuries.

Limiting experts

The Trial Lawyers' Association of B.C. also takes issue with the new cap on the number of experts who can file reports in settlement cases.

The province says several experts are often hired to work on a single case and they charge anywhere from $5,000 to $20,000 per report.

Under the new rules, only one expert can submit one report in fast-track claims, which are claims of under $100,000that can be resolved in three days or less.

All other claims have a cap of three expertswho can each submit one report.

"Time and again this government seems to favor ICBC's financial interests over the legal rights of British Columbians," the association said in a statement.

"This rush to pass restrictions on how victims of negligence must prove their cases at law is the most recent illustration of making car accident victims pay for reckless driving."

Watch the CBC's Jesse Johnston break down the changes that are coming to ICBC.

ICBC Changes Explained

5 years ago

Duration 3:01

Everything you need to know about the changes to ICBC.