Stephen Rees's blog

Thoughts about the relationships between transport and the urban area it serves

ICBC selling insurance to unlicensed drivers

with one comment


There is a great deal of buck passing in this story – mainly between ICBC and its broker.  When BC decided to go for public auto insurance, it made a clever decision to enlist the brokerages, which quite literally bought off the biggest potential source of opposition. It actually only makes political sense. Because the major function of a broker is to find the customer the best policy for his or her needs, and since ICBC is the only place you can buy the legally required insurance there is not a lot for the broker to do. And the fact that a lot of lawyers in BC now specialize in fighting ICBC,  shows where the brokers feel their loyalty lies. It was probably fairly sensible to use existing outlets, but then there are also other places you have to go – like the ICBC  claims centres and the province’s driver services offices.

Selling insurance to people who are not legally allowed to drive is, quite simply, wrong. Placing the onus on the customer may sound like a good practice from a business perspective

“Anybody who wants to buy insurance can buy insurance from us,” McLelland [the ICBC spokesperson] said. “The principle is we want people to have insurance.”

McLelland said the corporation does not track how many insurance policies are issued to drivers who don’t have B.C. licences. He said it also doesn’t count how may claims are denied for breach of policy because the licence isn’t valid.

BUT they did not have insurance. Money was taken from them for a policy that was worthless. If you are in a business that collects tax for the government (the ICBC brokers dish out license plates and stickers) and administers government activities such as motor vehicle registration and compliance with BC legislation (you cannot license your vehicle if it fails the AirCare test for instance) then you do not get the privilege of picking and chosing which bits of the law on drivers and vehicles you are supposed to know about.

And ICBC having taking the premiums has a moral if not a legal duty to acknowledge that its systems failed, the policy should not have been sold but in this case, the innocent victim who was badly advised by an officially appointed agent he should have been able to rely upon and he should be recompensed.

Written by Stephen Rees

May 28, 2008 at 10:53 am

Posted in Road safety

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One Response

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  1. I think it’s logical that if you buy car insurance that you should have a valid driver’s license but I don’t necessarily see that it’s incumbent on ICBC or the broker to do that check. Insuring a car and having a valid license are two distinct acts – you could have a suspended or expired license and still insure your car b/c your wife or child is the one driving it.

    That a car is driven primarily by someone other than who’s on the insurance papers isn’t uncommon – parents put their names on the car all the time when it’s their kids doing the driving.

    If the scenario was that I allowed someone without a valid license to drive my car and they got into an accident I would think that ICBC would be unwilling to cover the claim – it’s my responsibility as the owner of the vehicle to ensure that the driver(s) are legally allowed to drive.

    This case doesn’t seem so different than what I just described, if anything, I think ICBC was fair in that it allowed the insured to try to get a license after the accident and if he had passed they were willing to cover the claim. I can already imagine the hollering from some corners if the driver had passed and ICBC had covered them – if someone is irresponsible enough to drive without a license why should ICBC cover them?


    May 28, 2008 at 4:39 pm

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