August 2008 news releases

Provincial news releases

ICBC maintains performance through second quarter — August 22

Regional news releases

ICBC improves road safety in B.C. communities — August 19

ICBC maintains performance through second quarter — August 22

ICBC has reported its financial results through the first half of 2008. Net income at ICBC for the first half of the year was $255 million, approximately the same as the $256 million for the same period in 2007.

"ICBC's consistent financial performance for 2008 to date is the result of higher premium revenue - due, in large part, to the growth in the number of insured vehicles on the road and an increasing number of optional coverage policies - offset by higher claims and related costs," said Geri Prior, ICBC's interim president and CEO. "Our retained earnings act as a contingency fund and generates investment income, both of which help to keep rates low and stable for our customers over the long term."

As of July 1, 2008, ICBC's optional premium rates decreased by an average of three percent while basic rates are remaining the same as ICBC has not proposed an increase in 2008.

ICBC's investment income for the first half of the year was $269 million, which is 2.5 percent lower than for the same period last year, of $276 million. Claims and related costs for the six months ending June 30, 2008, were $1.5 billion, 3.8 percent higher than for the same period in 2007, of $1.45 billion.

Higher claims costs remain a concern at ICBC. The increasing numbers of vehicles on BC's roads mean claims costs are increasing, albeit at a slower rate than in previous years. However, for every $1.00 in premiums-earned, ICBC incurs approximately $1.03 in claims costs and operating expenses. Investment income helps ICBC offset some of this shortfall.

"With recent uncertainty in the financial markets and changing economic trends, we cannot rely on investment income to the same extent we have in the past," said Prior. "The current downturn in the equity markets will have a negative impact on our investment income as we move forward through 2008."

• Premiums earned for the first six months of 2008 increased to $1.79 billion from $1.70 billion for the first six months of 2007, in large part due to the increased number of insured vehicles on BC's roads - approximately 80,000 more in the first six months of 2008 compared to the same period last year.

• ICBC continues to lead the industry in low operating costs. The expense ratio - operating costs, broker commissions and premium taxes as a percentage of earned premiums - was 18.4 percent for the first six months of 2008, which continues to compare very favourably to the insurance industry.

• Claims costs are still increasing which is in line with an increasing number of ICBC policies being sold, but the cost of the average claim is rising at a slower rate as compared to recent experiences. While claims costs are lower than expected due to the unusually dry weather so far this year, the wetter autumn and winter months are still to come.

• ICBC's investment income for the first six months of 2008 was lower than for the same period last year. Results saw lower gains on equities and higher gains on bonds compared to the same period in 2007. The current market volatility will have a negative impact on our investment income in the second half of 2008, even though ICBC maintains a conservative investment policy with the majority of assets invested in high-quality, investment-grade bonds.

• ICBC continues to maintain high levels of customer satisfaction, as confirmed by independent third-party research from NRG Research Group. Levels of customer satisfaction with ICBC for our various lines of business are:
  • Insurance services: 94%
  • Claims services: 84%
  • Driver Licensing services: 93%

• There have been significant decreases in the number of stolen vehicles in BC for each of the last five years with numbers decreasing for stolen vehicles, vehicle break-ins and vandalism. This trend is continuing with a 17.4 percent drop in auto theft claims for the first six months of 2008 compared to the same period for 2007. Some of the major reasons for the dropping auto crime rates are the success of the Bait Car program and other enforcement efforts, as well as the growing prevalence of immobilizers in vehicles.

• ICBC continues to invest in road safety programs to reduce the number and severity of crashes, and to help lower claims costs. Examples include support for enhanced traffic enforcement by police, road improvements at high-crash locations, and public awareness campaigns.

Media Contact:
Adam Grossman (604) 982-1332

Regional news releases

ICBC improves road safety in B.C. communities — August 19

ICBC improves road safety in B.C. communities — August 19

Since 1989, ICBC has been partnering with municipalities and the provincial government to improve safety at high-crash locations in B.C. communities through its Road Improvement Program. With a budget of $8.6 million for 2008, ICBC expects to provide funding for 250 to 300 road improvement projects or studies across the province.

Road improvements are one of the most effective ways to improve safety for drivers and pedestrians. By making intersections and other high-crash locations safer, ICBC is helping to reduce crashes, prevent injuries, and save lives.

Projects earmarked for road improvement investments are assessed to ensure they make B.C. roads safer for all drivers and translate into lower claims costs for ICBC and its customers. The most recent independent evaluation of ICBC-funded road improvements found a four-to-one return-on-investment over two years following a project's completion.

Completed road improvement projects for 2008:

Location: Delta
Project: Installation of uninterrupted power supply (UPS) systems at five intersections along Nordel Way: 84th Avenue, Brooke Road, 120 Street, 116 Avenue and Shepherd Way

Partner: Corporation of Delta
ICBC contribution: $12,500

Location: Langley
Project: Improvements to sightline visibility at the intersection of 203rd Street and Industrial Avenue by relocating a retaining wall on the northwest corner. As part of the improvement, the City of Langley acquired property, moved the retaining wall and streetlighting cabinet away from the curb and also provided a sidewalk for pedestrians.
Partner: City of Langley
ICBC contribution: $25,000

Location: Mission
Project: Installation of a roadside barrier along Stave Lake Street (south of 11th Avenue)
Partner: District of Mission
ICBC contribution: $7,000

Location: North Vancouver
Project: Completion of second phase of the Cotton Road bike route. Two bike lanes were added along both sides of Cotton Road from Brooksbank Avenue to Mountain Highway. To improve intersection safety at Brooksbank and Cotton, the left turn lane was moved from westbound to southbound and the right turn channelization was moved from northbound to eastbound.
Partner: City of North Vancouver
ICBC contribution: $20,000

Location: Surrey
Project: Installation of a traffic signal at the intersection of 72nd Avenue and 130th Street
Partner: City of Surrey
ICBC contribution: $75,000

Location: Surrey
Project: Corridor and intersection improvements along 148th Street. The 148th Street corridor was widened, the northbound left-turn lane at 24th Ave was re-aligned and a southbound left-turn lane was installed at 26th Avenue.
Partner: City of Surrey
ICBC contribution: $18,000

Location: Vancouver
Project: Installation of a traffic signal at the intersection of Marine Drive and Yukon Street.
Partner: City of Vancouver
ICBC contribution: $35,000

Location: Vancouver Island
Project: Installation of a traffic signal and improvements to signage and road markings at the intersection of Highway 19A at Lee Road between Parksville and Qualicum Beach
Partner: Ministry of Transportation
ICBC contribution: $24,700

For more information on these road improvement projects or to request photos, contact:

Kim Thé
604-296-1539