September 13, 2001 by Canadian Underwriter
Following disclosure earlier this week by the Insurance Corp. of British Columbia (ICBC) of an expected $150 million loss for the current financial year, the Insurance Bureau of Canada (IBC) has called on the B.C. provincial government to conduct an independent financial review of the crown insurer. ICBC is operated by the provincial government and therefore not subject to minimum asset testing applied by regulators to private insurers.
IBC regional vice president Lindsay Olson questioned how ICBC had been able to earlier this year declare a surplus and issue $100 rebate cheques to all B.C. drivers. She implied that this may have been a political maneuver by the province’s previous National Democratic Party (NDP) government before the provincial elections took place which the NDP lost to the Liberal Party.
Olson says the new LP government has an obligation to the voting public to investigate the true state of ICBC’s financial affairs. Taxpayers will be responsible for any financial shortfall at ICBC, she adds. "This announcement [ICBC’s expected loss] raises concerns about the adequacy of ICBC’s reserves, especially in light of the ongoing and unprecedented reduction of claim reserves under the previous government."