How it currently works

The current model does not fully consider driving experience when determining the rates customers pay.

There is no additional rate discount given for Optional insurance customers once they have reached 20 years of safe driving with no at-fault crashes, even though their experience continues to grow. No additional discount is given after nine years of safe driving for Basic insurance customers. Currently, this means that 80% of drivers receive the maximum Basic insurance discount with no room for additional savings based on driving experience.

Certain drivers, such as seniors, new residents and inexperienced drivers, currently receive additional discounts or considerations in determining their rate:

  • Seniors: A discount is provided to those who are 65 or older and insuring their vehicles for pleasure use only. This is over and above any regular discount they may have for crash-free driving.
  • New residents to B.C.: Eight years is the maximum amount of driving experience (years licensed) that is considered in determining insurance premiums for people new to B.C.
  • Inexperienced drivers (those with fewer than 10 years of driving experience): Inexperienced drivers receive substantial Basic insurance discounts especially within their first three years of driving.

Proposals to make Basic rates more fair:

  1. Better recognize driving experience.
  • Extend the number of years of driving experience used in the calculation of a customer’s discount. This could be doubled from the current 20 years to allow customers to continue to earn additional discounts up until 40 years of safe driving experience.
  1. Adjust policies related to seniors, new residents and inexperienced drivers.
  • For seniors: Reduce the discount after the first at-fault crash (within the last 10 years after claims forgiveness applies); any subsequent at-fault crash would remove the discount entirely.
  • For new residents:
    • Extend the maximum years of driving experience to 15 years (up from the current eight years), when determining their premium.
    • Also, to improve efficiencies and reduce complexities in handling historical claims experience information from different jurisdictions, develop an overall premium surcharge that would apply for the first three years to all new residents who operate a vehicle in B.C. After the first three years, new resident drivers would transition to the same rating structure as B.C. residents.
  • For inexperienced drivers (those with fewer than 10 years of driving experience): Make minimal adjustments to current rates if these drivers are crash-free. The main change would make additional adjustments that could remove the discount upon at-fault crashes. This would help to increase rate fairness by better reflecting the risks inexperienced drivers represent.