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Traffic enters the Oak Street Bridge heading into Richmond from Vancouver in January, 2018.Rafal Gerszak

One-third of B.C. motorists can expect higher insurance premiums as part of reforms that aim to punish high-risk drivers, under proposed changes to the province's public auto insurance product.

On Monday, Attorney-General David Eby launched a public consultation process to help shape the tricky question of what defines a bad driver.

The publicly owned Insurance Corp. of B.C. (ICBC), which is struggling financially, provides basic insurance for private vehicles and rates are tied to the vehicle and registered owner.

If the changes are approved, Mr. Eby said, it will be the first time in British Columbia that auto-insurance rates are directly linked to an individual driver as opposed to the registered operator of the vehicle.

"It's a fairly significant shift in how we structure rates, if we go in that direction, so we want to make sure that feels fair and appropriate to British Columbians," he told reporters in Victoria.

The NDP government has promised broader reforms to restore the Crown corporation's fiscal stability – Mr. Eby refers to ICBC's books as "a financial dumpster fire." Those changes include plans to introduce elements of no-fault auto insurance and cap payouts for pain and suffering from minor injuries, starting in April, 2019.

ICBC is forecast to lose $1.3-billion in the fiscal year just ending and large rate hikes are on the horizon unless major savings are found. Accident rates are climbing and the cost of repairing vehicles and settling injury claims are skyrocketing. Revenue from premiums has not kept pace.

But the measures proposed this week revolve around bad drivers and are not designed to raise new revenue. Mr. Eby said these changes would be revenue-neutral and cash from higher premiums collected from "bad drivers" would be used to reduce premiums for the two-thirds of drivers who are classed as low-risk. The measures are outlined in an online survey that will be available for comment for the next month.

Mr. Eby said he believes British Columbians support the notion of moving to a system that is oriented around the driver rather than the vehicle, so that bad driving habits are more effectively penalized.

He said consumer buy-in for the changes is important: "The question is, who is a bad driver, and how much more should they pay? Is it someone who has two speeding tickets? Is it someone who has at-fault accidents? Is it someone who has a single infraction with excessive speeding?"

In 2011, ICBC attempted to institute similar changes, but was forced to retreat in the face of a backlash. The New Democrats, then in opposition, were among the critics of the proposal to make drivers pay three years of higher premiums after a single speeding ticket.

At that time, ICBC's top official apologized for the proposal and said the Crown corporation needed to do a better job of communicating with the public.

The public consultation may be designed to build up the social licence to make the changes stick, but Richard McCandless, a retired civil servant who has acted as an intervenor in regulatory hearings on ICBC rates, said the survey is deeply flawed.

"They are laying the groundwork for the same thing again," Mr. McCandless said in an interview. "The problem is that it is a simplistic and biased survey. … They are asking people for their opinion, without any data provided to form an opinion. It's implied that the current system is not fair, but it doesn't say why it's not fair – and then it dangles these carrots that two-thirds of drivers are going to save money."

The survey asks about a series of specific proposals "to make rates more fair." It includes changes that will see inexperienced drivers treated as a higher risk, while those who travel only short distances would be eligible for additional discounts.

Mr. Eby acknowledged that parents who loan a family vehicle to their children as new drivers may notice the changes acutely. "This will have an impact on their insurance rates," he said. The survey notes that about 20 per cent of crashes are caused by someone other than the principal operator listed on the insurance. Under the new system, if adopted, parents would face tough penalties for failing to list any children who live at home who use a family vehicle on their insurance.

For inexperienced drivers – those with fewer than 10 years behind the wheel – the proposed changes would mean minimal adjustments to current rates if these drivers are crash-free. But with just one at-fault crash, those drivers would lose their safe driver discount.

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