Re: 鈥淚CBC鈥檚 changes not common in industry,鈥� letter, Oct. 12.
Aaron Sutherland, representing the private auto insurance industry, has aided the public understanding of ICBC鈥檚 new basic rate design by commenting that the unlisted-driver penalty and the 鈥減rotection fee鈥� are not common practice in sa国际传媒 or the United States.
The penalty and the proposed minimum $50 avoidance fee have been poorly thought out, are an abuse of ICBC鈥檚 monopoly power, and will likely to cost more in confusion and discontent than they are worth.
Sutherland overstates the case for opening basic insurance to the for-profit insurers. ICBC鈥檚 rates are high because we have an expensive full-tort model and our initial no-fault accident-benefit limits (for example rehabilitation and wage loss) are better than those jurisdictions serviced by private insurers. The NDP government plans to curb the claims costs by capping pain-and-suffering payments for minor injuries, which will help relieve the pressure on the rates.
It鈥檚 not as simple as saying that premiums would be lower with competition. The premiums reflect the cost of the injury and property-damage claims. The way to reduce the price of insurance is to lower the number and severity of claims.
Richard McCandless
Saanich
