ICBC shaves claim costs

With revenue growth exceeding costs for the third year in a row for 1999, the Insurance Corporation of British Columbia (ICBC) was able to increase its rate stabilization reserve to $381 million. The public insurer’s net income for last year amounted to $96 million, up from $74 million reported for the 1998 financial year. Investment income played a key role in the company’s performance, rising from $412 million in 1998 to $449 million at the end of last year.

A drop in claims costs, from $1.9 billion in 1998 to $1.8 billion in 1999, also factored favorably for the insurer, says ICBC president and CEO Thom Thompson. “We have worked hard to keep claims costs down. ‘Road Sense’ initiatives and better claims handling procedures are contributing to our positive results.”

Total premiums written dropped slightly to $2.38 billion, down from almost $2.4 billion the year previous. This largely resulted from reduced premium rates for good drivers under ICBC’s “RoadStar” programs, the corporation reports. While claims costs dropped last year, claims volume rose from 1998. However, Thompson notes that death benefit claims actually decreased.