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"Point in Time" Regulation Content

Insurance Corporation Act and Utilities Commission Act

Special Direction IC2 to the British Columbia Utilities Commission

B.C. Reg. 307/2004

NOTE: Links below go to reg content as it was prior to the changes made on the effective date. (PIT covers changes made from September 19, 2009 to present)
SECTIONEFFECTIVE DATE
Section 1 September 24, 2009
April 29, 2010
March 19, 2013
August 25, 2016
August 9, 2018
Section 1.1 March 19, 2013
October 15, 2015
August 25, 2016
Section 1.2 October 15, 2015
August 25, 2016
August 9, 2018
Section 2 August 25, 2016
Section 3 September 24, 2009
April 29, 2010
May 31, 2012
March 19, 2013
February 18, 2014
October 15, 2015
August 25, 2016
December 7, 2016
December 19, 2016
March 3, 2017
March 28, 2017
August 31, 2017
December 18, 2017
February 2, 2018
February 26, 2018
March 1, 2018
April 13, 2018
August 9, 2018
August 9, 2018
December 10, 2018
May 10, 2019
July 8, 2019
August 21, 2019
December 9, 2019
Section 3.1 August 9, 2018
Section 4 April 29, 2010

 Section 1 definitions of "capital available" and "MCT" BEFORE amended by BC Reg 229/2009, effective September 24, 2009.

"capital available" means capital available as that term is defined in

(a) the regulations and guidelines made under section 515 (2) of the Insurance Companies Act (Canada), and

(b) the Guidelines for Minimum Capital Test (MCT) for Federally Regulated Property and Casualty Insurance Companies number A-1 dated July, 2003 issued by the Office of Superintendent of Financial Institutions;

"MCT" means MCT as that term is defined in

(a) the regulations and guidelines made under section 515 (2) of the Insurance Companies Act (Canada), and

(b) the Guidelines for Minimum Capital Test (MCT) for Federally Regulated Property and Casualty Insurance Companies number A-1 dated July, 2003 issued by the Office of Superintendent of Financial Institutions.

 Section 1 definition of "MCT" BEFORE amended by BC Reg 108/2010, effective April 29, 2010.

"MCT" means MCT as that term is described in the Guideline for Minimum Capital Test (MCT) for Federally Regulated Property and Casualty Insurance Companies No. A dated March 2008 issued by the Office of Superintendent of Financial Institutions Canada.

 Section 1 definition of "MCT guideline" was added by BC Reg 108/2010, effective April 29, 2010.

 Section 1 definition of "capital available" BEFORE amended by BC Reg 115/2013, effective March 19, 2013.

"capital available"  means capital available as that term is described in the Guideline for Minimum Capital Test (MCT) for Federally Regulated Property and Casualty Insurance Companies No. A dated March 2008 issued by the Office of Superintendent of Financial Institutions Canada;

 Section 1 definitions of "capital management target", "customer renewal credit", "excess capital available", "existing rates", "general rate change order", "loss costs" and "loss costs forecast variance" were added by BC Reg 115/2013, effective March 19, 2013.

 Section 1 definitions of "capital management plan", "fiscal year" and "policy year" were added by BC Reg 215/2016, effective August 25, 2016.

 Section 1 definitions of "capital management target" and "excess capital available" BEFORE amended by BC Reg 215/2016, effective August 25, 2016.

"capital management target" means the MCT target, determined in a capital management plan approved by the commission, that is the total of the following:

"excess capital available" means universal compulsory vehicle insurance capital available in excess of the capital reflected in the capital management target specified in a capital management plan approved by the commission;

 Section 1 was renumbered, the definition of "extended policy period" and (2) were added by BC Reg 171/2018, effective August 9, 2018.

 Section 1 (1) definition of "policy year" BEFORE amended by BC Reg 171/2018, effective August 9, 2018.

"policy year" means the period from November 1 in one year to October 31 in the next year.

 Section 1.1 was enacted by BC Reg 115/2013, effective March 19, 2013.

 Section 1.1 (part) BEFORE amended by BC Reg 192/2015, effective October 15, 2015.

MCT

1.1   For each year for which the commission fixes universal compulsory vehicle insurance rates, the MCT must be determined

 Section 1.1 BEFORE amended by BC Reg 215/2016, effective August 25, 2016.

MCT

1.1   Subject to section 1.2, for each year for which the commission fixes universal compulsory vehicle insurance rates, the MCT must be determined

(a) using data available from the most recent quarter at the time the corporation files a general rate change order, and

(b) as at the end of that year.

 Section 1.2 was enacted by BC Reg 192/2015, effective October 15, 2015.

 Section 1.2 BEFORE amended by BC Reg 215/2016, effective August 25, 2016.

MCT — 2015 rates

1.2   For rates effective November 1, 2015, despite any other provision of this Special Direction, the capital available used in the determination of the MCT under section 1.1 must be $450 million higher than the capital available set out in the data described in section 1.1 (a).

 Section 1.2 BEFORE repealed by BC Reg 171/2018, effective August 9, 2018.

MCT — 2016 rates

1.2   For rates effective November 1, 2016, despite any other provision of this Special Direction, the capital available used in the determination of the MCT under section 1.1 must be $99 million higher than the capital available set out in the data described in section 1.1 (a).

[en. B.C. Reg. 215/2016, s. 2.]

 Section 2 BEFORE amended by BC Reg 215/2016, effective August 25, 2016.

Application

2   This Special Direction is issued to the commission under section 47 of the Act and section 3 of the Utilities Commission Act.

 Section 3 (1) (c) (ii) (E) BEFORE amended by BC Reg 229/2009, effective September 24, 2009.

(E)  the payments that the corporation is to make in that year under the agreement entitled "Traffic and Road Safety Law Enforcement Funding Memorandum of Understanding" made between the corporation and the government as represented by the Minister of Public Safety and Solicitor General and dated December 2, 2003, and

 Section 3 (1) (c) (ii.1) was added by BC Reg 229/2009, effective September 24, 2009.

 Section 3 (1) (a) BEFORE repealed by BC Reg 108/2010, effective April 29, 2010.

(a) set, for 2004, a net income target for the corporation generally, in the amount of $36 million;

 Section 3 (1) (b) BEFORE amended by BC Reg 108/2010, effective April 29, 2010.

(b) require the corporation to achieve, by December 31, 2014, and to maintain, after that date, capital available equal to at least 110% of MCT, and, for that purpose,

(i)  Repealed. [B.C. Reg. 300/2005, s. (a).]

(ii)  the commission must set rates for the corporation's universal compulsory vehicle insurance business in a way that will allow the corporation to achieve, by December 31, 2014, and to maintain after that date, capital available in relation to its universal compulsory insurance business equal to at least 100% of MCT;

 Section 3 (1) (c) (ii.2) was added by BC Reg 108/2010, effective April 29, 2010.

 Section 3 (1) (c) (ii.3) was added by BC Reg 116/2012, effective May 31, 2013.

 Section 3 (1) (a.1) was added by BC Reg 115/2013, effective March 19, 2013.

 Section 3 (1) (b) BEFORE amended by BC Reg 115/2013, effective March 19, 2013.

(b) set rates for the corporation's universal compulsory insurance business in a way that will allow the corporation to maintain capital available in relation to its universal compulsory insurance business equal to at least 100% of MCT;

 Section 3 (1) (c) (ii.2) and (iii) BEFORE amended by BC Reg 115/2013, effective March 19, 2013.

(ii.2)  for 2010 and subsequent years, to make the payments that the corporation has agreed to make under the agreement dated for reference January 1, 2010, between the corporation and the government as represented by the Minister of Public Safety and Solicitor General entitled "Traffic and Road Safety Law Enforcement Funding Memorandum of Understanding",

(iii)  for 2005 and each following year for which rates are set, to achieve or maintain, as the case may be, the capital available required by the capital available target established for that year under paragraph (b);

 Section 3 (1) (c) (iv), (c.2) and (c.3) were added by BC Reg 115/2013, effective March 19, 2013.

 Section 3 (3) BEFORE amended by BC Reg 115/2013, effective March 19, 2013.

(3)  In regulating and fixing rates for the corporation, the commission must treat any premiums levied under section 34 (1.1) (e) of the Insurance (Vehicle) Act as revenue for the corporation's universal compulsory automobile insurance business.

 Section 3 (1) (a.1) BEFORE amended by BC Reg 20/2014, effective February 18, 2014.

(a.1) beginning in 2014, require the corporation to apply annually for a general rate change order by May 31 of the year of the application for rates effective August 1 of that year;

 Section 3 (1) (c.2) (i) and (ii) (part) BEFORE amended by BC Reg 192/2015, effective October 15, 2015.

(i) for 2013, the loss costs forecast variance must not be reflected in the general rate change order, and

(ii) for 2014 and each following year for which rates are set,

 Section 3 (1) BEFORE amended by BC Reg 215/2016, effective August 25, 2016.

(1) With respect to the exercise of its powers and functions under the Act in relation to the corporation generally, the commission must do the following:

(a) Repealed. [B.C. Reg. 108/2010, s. 2 (a).]

(a.1) beginning in 2014, require the corporation to apply annually for a general rate change order by August 31 of the year of the application for rates effective November 1 of that year;

(b) set rates for the corporation's universal compulsory vehicle insurance business in a way that will allow the corporation to maintain, in relation to its universal compulsory vehicle insurance business, at least 100% of MCT;

(c) subject to paragraphs (c.1) and (e), for each year for which it fixes universal compulsory vehicle insurance rates, fix those rates on the basis of accepted actuarial practice so that those rates allow the corporation to collect sufficient revenue,

(i) for 2004, to achieve the net income target set for that year under paragraph (a),

(ii) for each following year for which rates are set, to pay the following:

(A) the costs that are to be incurred by the corporation in that year for road safety programs under section 7 (i) of the Act, including, without limitation, payments by the corporation to any level of government with respect to road safety;

(B) the costs that are to be incurred by the corporation in that year for vehicle licensing, driver licensing and other services and activities of the corporation under section 7 (g) and (h) of the Act that are to be undertaken in that year in accordance with the agreement, as amended from time to time, entitled "Service Agreement between The Ministry of Public Safety and Solicitor General and the Insurance Corporation of British Columbia" and dated as of September 1, 2003;

(C) the payments that the corporation is to make in that year under the agreement entitled "Memorandum of Understanding between B.C. Provincial Government and ICBC" and executed in February, 2003;

(D) the remuneration that the corporation is to pay in that year to persons appointed as agents by the corporation under section 9.2 of the Insurance Corporation Act for collecting government fees, fines and other amounts payable by the corporation to the government and for collecting premiums, fees, debts and other revenue on behalf of the corporation;

(E) up to and including 2008, the payments that the corporation is to make in that year under the agreement entitled "Traffic and Road Safety Law Enforcement Funding Memorandum of Understanding" made between the corporation and the government as represented by the Minister of Public Safety and Solicitor General and dated December 2, 2003,

(ii.1) for 2009, to make the payments that the corporation has agreed to make under the agreement dated for reference January 1, 2009, between the corporation and the government as represented by the Minister of Public Safety and Solicitor General entitled "Traffic and Road Safety Law Enforcement Funding Memorandum of Understanding",

(ii.2) for 2010 and subsequent years, to make the payments that the corporation has agreed to make under the agreement dated for reference January 1, 2010, between the corporation and the government as represented by the Minister of Public Safety and Solicitor General entitled "Traffic and Road Safety Law Enforcement Funding Memorandum of Understanding",

(ii.3) for 2012 and subsequent years, to make the payments that the corporation has agreed to make under the agreement dated for reference April 1, 2012, between the corporation and the government as represented by the Minister of Justice and Attorney General entitled "Traffic and Road Safety Law Enforcement Funding Memorandum of Understanding", including amendments and extensions to that agreement,

(iii) for 2005 and each following year for which rates are set, to achieve or maintain, as the case may be, the MCT requirement under paragraph (b), and

(iv) for 2013 and each following year, ensure that rates are set in accordance with a capital management plan approved by the commission that includes capital maintenance and build or release provisions;

(c.1) when regulating and fixing universal compulsory vehicle insurance rates, regulate and fix those rates in a manner that recognizes and accepts actions taken by the corporation in compliance with government directives issued to the corporation;

(c.2) despite paragraph (c),

(i) for 2013 and 2015, the loss costs forecast variance must not be reflected in the general rate change order, and

(ii) for 2014 and each following year, except 2015, for which rates are set,

(A) the commission may exclude some or all of that year's loss costs forecast variance from the rate fixed by a general rate change order in accordance with a capital management plan approved by the commission, and

(B) the percentage number of a rate change fixed by a general rate change order must differ from the percentage number of a rate change fixed by the previous general rate change order by no more than 1.5, and must not decrease existing rates;

(c.3) for 2014 and each following year for which the commission fixes universal compulsory vehicle insurance rates, approve a customer renewal credit if

(i) there is excess capital available,

(ii) the customer renewal credit will not result in the MCT falling below the capital management target specified in a capital management plan approved by the commission, and

(iii) the commission determines that rates fixed by general rate change orders will remain relatively stable and predictable despite the approval of the customer renewal credit;

(d) subject to subsection (2) of this section, ensure that universal compulsory vehicle insurance rates are not based on age, gender or marital status;

(e) ensure that increases or decreases in universal compulsory vehicle insurance rates are phased in such a way that those rates remain relatively stable and predictable.

 Section 3 (1) (c) and (j) BEFORE amended by BC Reg 288/2016, effective December 7, 2016.

(c) subject to paragraphs (g) and (j), for each policy year for which the commission fixes universal compulsory vehicle insurance rates, fix those rates on the basis of accepted actuarial practice so that those rates allow the corporation to collect sufficient revenue

(j) ensure that increases or decreases in universal compulsory vehicle insurance rates are phased in in such a way that those rates remain relatively stable and predictable.

 Section 3 (1) (k) was added by BC Reg 288/2016, effective December 7, 2016.

 Section 3 (1) (a.1) and (c) were added by BC Reg 319/2016, effective December 19, 2016.

 Section 3 (1) (c) (part) and (k) BEFORE amended by BC Reg 81/2017, effective March 3, 2017.

(c) subject to paragraphs (g), (j) and (k), for each policy year for which the commission fixes universal compulsory vehicle insurance rates, fix those rates on the basis of accepted actuarial practice so that those rates allow the corporation to collect sufficient revenue

(k) despite paragraph (j), within 20 days of the corporation applying for approval of a high-value vehicle charge in accordance with a government directive, approve and set the rates for the charge.

 Section 3 (1) (l) was added by BC Reg 81/2017, effective March 3, 2017.

 Section 3 (1) (c) (ii) BEFORE amended by BC Reg 119/2017, effective March 28, 2017.

(ii) to make the payments that the corporation agreed to make under the agreement dated for reference April 1, 2012, between the corporation and the government as represented by the Minister of Justice and Attorney General entitled "Traffic and Road Safety Law Enforcement Funding Memorandum of Understanding", including the amendment and extension to that agreement entitled "Traffic and Road Safety Law Enforcement Funding Memorandum of Understanding Extension and Amendment" and dated for reference April 1, 2015, and

 Section 3 (1) (a.1) BEFORE amended by BC Reg 165/2017, effective August 31, 2017.

(a.1) for the 2016 policy year, issue its final general rate change order by January 16, 2017;

 Section 3 (1) (c) (i) (B) BEFORE amended by BC Reg 165/2017, effective August 31, 2017.

(B) the costs that are to be incurred by the corporation in that policy year for vehicle licensing, driver licensing and other services and activities of the corporation under section 7 (g) and (h) of the Act that are to be undertaken in that policy year in accordance with the agreement entitled "Service Agreement between The Ministry of Public Safety and Solicitor General and the Insurance Corporation of British Columbia" and dated as of September 1, 2003, including amendments and extensions to that agreement up to and including the amendment and extension entitled "Service Agreement Addendum Changes in Costs and Services to December 31, 2015" and executed in May, 2016;

 Section 3 (1) (a.1) BEFORE amended by BC Reg 240/2017, effective December 18, 2017.

(a.1) despite paragraph (a), require the corporation to apply by September 15, 2017, for a general rate change order for rates to be effective November 1 of that year;

 Section 3 (1) (c) (part) BEFORE amended by BC Reg 7/2018, effective February 2, 2018.

(c) subject to paragraphs (g), (j), (k) and (l), for each policy year for which the commission fixes universal compulsory vehicle insurance rates, fix those rates on the basis of accepted actuarial practice so that those rates allow the corporation to collect sufficient revenue

 Section 3 (1) (m) was added by BC Reg 7/2018, effective February 2, 2018.

 Section 3 (1.2) and (1.3) were added by BC Reg 22/2018, effective February 26, 2018.

 Section 3 (1) (c) (part) BEFORE amended by BC Reg 25/2018, effective March 1, 2018.

(c) subject to paragraphs (g), (j), (k), (l) and (m), for each policy year for which the commission fixes universal compulsory vehicle insurance rates, fix those rates on the basis of accepted actuarial practice so that those rates allow the corporation to collect sufficient revenue

 Section 3 (1) (n) was added by BC Reg 25/2018, effective March 1, 2018.

 Section 3 (1) (c) (ii) BEFORE amended by BC Reg 70/2018, effective April 13, 2018.

(ii) to make the payments that the corporation agreed to make under the agreement dated for reference April 1, 2017, between the corporation and the government as represented by the Minister of Public Safety and Solicitor General entitled "Traffic and Road Safety Law Enforcement Funding Memorandum of Understanding", and

 Section 3 (1) (c) (part) BEFORE amended by BC Reg 172/2018, effective August 9, 2018.

(c) subject to paragraphs (g), (j), (k), (l), (m) and (n), for each policy year for which the commission fixes universal compulsory vehicle insurance rates, fix those rates on the basis of accepted actuarial practice so that those rates allow the corporation to collect sufficient revenue

 Section 3 (1) (o) was added by BC Reg 172/2018, effective August 9, 2018.

 Section 3 (1) (part), (1.2), (1.3) and (3) BEFORE amended by BC Reg 171/2018, effective August 9, 2018.

(1) With respect to the exercise of its powers and functions under the Act in relation to the corporation generally, the commission must do all the following:

(1.2) Subsection (1) (b) and (c) (iii) does not apply with respect to the fixing of rates for the 2018, 2019, 2020 and 2021 policy years.

(1.3) Despite the definition of "capital management target" in section 1, for the 2018, 2019, 2020 and 2021 policy years, the capital management target is 145% of MCT.

(3) In regulating and fixing rates for the corporation, the commission must treat any premiums levied under section 34 (1.1) (e) of the Insurance (Vehicle) Act as revenue for the corporation's universal compulsory vehicle insurance business.

 Section 3 (1) (a) and (e) (part) BEFORE amended by BC Reg 171/2018, effective August 9, 2018.

(a) require the corporation to apply by August 31 of each year for a general rate change order for rates to be effective November 1 of that year;

(e) despite paragraph (d), for the 2016 policy year and each following policy year up to and including the 2020 policy year, ensure that rates are set in accordance with the capital management plan in existence on May 27, 2016,

 Section 3 (1) (a.01) and (a.2) were added by BC Reg 171/2018, effective August 9, 2018.

 Section 3 (1) (f) BEFORE repealed by BC Reg 171/2018, effective August 9, 2018.

(f) for the 2016 policy year, ensure that rates are set based on the equity of the universal compulsory vehicle insurance business being $99 million higher than the equity set out in the data described in section 1.1 (a);

 Section 3 (1) (c) (i) (B) BEFORE amended by BC Reg 270/2018, effective December 10, 2018.

(B) the costs that are to be incurred by the corporation in that policy year for vehicle licensing, driver licensing and other services and activities of the corporation under section 7 (g) and (h) of the Act that are to be undertaken in that policy year in accordance with the agreement entitled "Service Agreement between The Ministry of Public Safety and Solicitor General and the Insurance Corporation of British Columbia" and dated as of September 1, 2003, including amendments and extensions to that agreement up to and including the amendment and extension entitled "Service Agreement Addendum Changes in Costs and Services to March 31, 2017" and executed in August, 2017;

 Section 3 (1) (c) (ii) BEFORE amended by BC Reg 270/2018, effective December 10, 2018.

(ii) to make the payments that the corporation agreed to make under the agreement, dated for reference April 1, 2018, between the corporation and the government as represented by the Minister of Public Safety and Solicitor General entitled "Extension and Amendment to Traffic and Road Safety Law Enforcement Funding Memorandum of Understanding", and

 Section 3 (1) (c) (part) BEFORE amended by BC Reg 99/2019, effective May 10, 2019.

(c) subject to paragraphs (g), (j), (k), (l), (m), (n) and (o), for each policy year for which the commission fixes universal compulsory vehicle insurance rates, fix those rates on the basis of accepted actuarial practice so that those rates allow the corporation to collect sufficient revenue

 Section 3 (1) (p) was added by BC Reg 99/2019, effective May 10, 2019.

 Section 3 (1) (c) (part) BEFORE amended by BC Reg 159/2019, effective July 8, 2019.

(c) subject to paragraphs (g), (j), (k), (l), (m), (n), (o) and (p), for each policy year for which the commission fixes universal compulsory vehicle insurance rates, fix those rates on the basis of accepted actuarial practice so that those rates allow the corporation to collect sufficient revenue

 Section 3 (1) (q) was added by BC Reg 159/2019, effective July 8, 2019.

 Section 3 (1) (c) (part) BEFORE amended by BC Reg 190/2019, effective August 21, 2019.

(c) subject to paragraphs (g), (j), (k), (l), (m), (n), (o), (p) and (q), for each policy year for which the commission fixes universal compulsory vehicle insurance rates, fix those rates on the basis of accepted actuarial practice so that those rates allow the corporation to collect sufficient revenue

 Section 3 (1) (r) was added by BC Reg 190/2019, effective August 21, 2019.

 Section 3 (1) (c) (part) BEFORE amended by BC Reg 259/2019, effective December 9, 2019.

(c) subject to paragraphs (g), (j), (k), (l), (m), (n), (o), (p), (q) and (r), for each policy year for which the commission fixes universal compulsory vehicle insurance rates, fix those rates on the basis of accepted actuarial practice so that those rates allow the corporation to collect sufficient revenue

 Section 3 (1) (s) was added by BC Reg 259/2019, effective December 9, 2019.

 Section 3.1 was enacted by BC Reg 171/2018, effective August 9, 2018.

 Section 4 (1) BEFORE amended by BC Reg 108/2010, effective April 29, 2010.

(1)  With respect to the exercise of its powers and functions under the Act in relation to the corporation's optional vehicle insurance business, the commission

(a) must, for 2004, set a net income target of $0 for the corporation's optional vehicle insurance business,

(b) must require the corporation to achieve by December 31, 2010 and to maintain, after that date, capital available in relation to the corporation's optional vehicle insurance business equal to at least 200% of MCT,

(c) must require the corporation to do the following:

(i)  as at the beginning of the corporation's 2004 fiscal year, allocate to the corporation's optional vehicle insurance business that portion of the corporation's retained earnings for its 2003 fiscal year that is necessary to allow the corporation to achieve, in its 2004 fiscal year, capital available in relation to the corporation's optional vehicle insurance business equal to 170% of MCT;

(ii)  as at the beginning of the corporation's 2004 fiscal year, allocate the balance of the corporation's retained earnings for its 2003 fiscal year to the corporation's universal compulsory insurance business;

(iii)  advise the commission of those allocations, and

(d) must not fix rates applicable to optional insurance.