VANCOUVER, B.C. — A news report surfaced yesterday indicating the Insurance Corp. of B.C. (ICBC) may be preparing for a substantial rate hike.
BCTV reported premiums will once again rise this year, thanks largely to the Crown Corporation’s poor investments in the stock market and real estate. Last year ICBC raised premiums an average of 7.4 per cent, but it’s still too soon to tell how much commercial carriers and O/Os will have to shell out this year.
ICBC has more than $874 million invested in stocks, but that number has declined as the stock market has tumbled. In fact, news reports indicate the company lost more than $12 million in Bombardier stocks alone. It lost another $21 million when Nortel Networks shares plunged from $11.90 to $1.79.
Meanwhile, ICBC built a $253 million building over the past couple years in Surrey, and while it was completed on budget, the company has already lost more than $140 million in its real estate investments.
Doug McClelland, ICBC spokesman, told BCTV the Crown Corporation always relied on investments to offset the costs of customer claims.
"But now those days are gone," he says. "And there really is only one place to go, and that is to our customers for a possible rate increase."
He says the cost increase will be announced in the coming weeks.
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