One way ICBC will reduce legal costs

The government of British Columbia has introduced legislative amendments in an effort to reduce costs and speed up motor vehicle claims in the current auto insurance system.

The proposed amendments will limit the number of experts and expert reports that can be used in court on the issue of damages, while also providing “judicial discretion to allow additional expert reports in appropriate cases,” B.C.’s Ministry of Attorney General said in a press release Monday.

The changes to the Evidence Act are steps towards the Insurance Corporation of B.C. (ICBC)’s new Enhanced Care model, which takes effect May 1, 2021. The no-fault style auto insurance model (with certain exceptions that will allow parties to sue) will remove lawyers and legal costs from the system to reduce rates by about 20%, ICBC said Feb. 6 when it introduced the new model.

According to the provincial government, the amendments will “reduce the cost and complexity of lawsuits under the current auto insurance system.” Since 2017, the increased use of experts has contributed to a 30% increase in the cost of litigated ICBC injury claims, the Ministry of Attorney General said.

Under the changes, there will be a limit of one expert and expert report for each party for fast-track claims, such as those under $100,000. A maximum of three experts and reports for each party will be set for all other claims. Parties can also agree to use more experts without the need to file a formal application to the court.

“With limits on the number of experts and expert reports, we are reducing the cost, complexity and delay associated with expensive duelling experts,” said Attorney General David Eby. “It means that claims will be resolved more efficiently.”

Related: The story behind ICBC’s bold change to auto insurance

Should the legislation pass, there would be a limit on the amount recoverable from the unsuccessful litigant for the cost of each expert report in motor vehicle personal injury cases to $3,000. Total recoverable disbursements in motor vehicle personal injury cases would also be limited to 5% of the judgment or settlement. (Disbursements include all expenses incurred for the purpose of a lawsuit, such as courier fees, process servers and photocopying, but will not include fees payable to the Crown, such as filing, court and jury fees.)

Currently, there are more than 90,000 active auto insurance claims. There is the potential for more claims to be brought forward between now and when the new system takes effect next year, the government noted.

The limit on experts will not apply if the expert report was served before Feb. 6 or if a notice of trial was filed and served before that date for a trail before Oct. 1, 2020. Likewise for the proposed $3,000 limit and the 5% limit on disbursements.

Under ICBC’s new care-based model, premiums will decrease 20%, or about $400 per driver. At the same time, maximum care and treatment benefits for anyone injured in a crash will increase to at least $7.5 million. The changes are estimated to remove $1.5 billion in costs in the first year.