ICBC spends $800K in damage claims for Ferrari that crashed into pole

British Columbia's public insurer says it has spent $789,375 in damage claims for a Ferrari that crashed into a pole.

The Insurance Corp. of B.C. is embroiled in a court battle over the claims and repairs, which it says could cost more than $982,000 in total.

According to documents filed in B.C. Supreme Court, the plaintiff accidentally drove the 1990 Ferrari F40 into a utility pole on Sept. 9, 2012, leaving it badly damaged. The repairs have not yet been completed.

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The driver is arguing that ICBC has breached an implied duty to process his claim and carry out the repairs in good faith and a timely manner.

Payments exceed cash value of the car

"He alleges further that ICBC acted in bad faith in refusing, at least for a time, to approve and arrange the needed repair work and that delay has caused him various kinds of harm," a judgment in the case reads.

Following an investigation, ICBC eventually admitted coverage and has agreed to cover most of the cost of repairs.

But it says it has already paid enough toward the claim, since its payments exceed the cash value of the car — which an arbitrator pinned at $696,061 in 2014.

The case is ongoing.

'Swamp of ineptitude and delays'

Kris Sims, B.C. director for the Canadian Taxpayers Federation, said the case is a perfect example of why the province should do away with the Crown corporation and leave auto insurance to private companies.

"We end up with this swamp of ineptitude and delays. This perfectly highlights it — here we've got someone who has $900,000 worth of repairs needed and a government monopoly not equipped to do it," Sims said.

She said private insurers are better equipped to insure cars because competition gives them incentive to expedite both claim and court processes, with legal teams, estimators, repair specialists on hand.

Taxpayers should be responsible for neither the damage claims nor the court costs, Sims said.

"We're unfortunately all in this together, whether we like it or not," she said.

Higher rates for luxury vehicles

Last week, the province introduced an online survey on major shifts being considered to modernize ICBC.

The provincial budget forecasts a $1.3-billion deficit at the Crown corporation this year. Attorney General David Eby has described the situation as a "dumpster fire" he says he inherited by the former Liberal government.

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In January 2017, ICBC began charging higher insurance premiums on luxury vehicles. 

As part of the latest provincial budget, starting April 1, new tax rates will apply to new and used passenger vehicles worth between $125,000 and $149,000.

The rate increases from 10 to 15 per cent.

Vehicles with a purchase price of $150,000 and above will be taxed at 20 per cent up from 10 per cent.

With files from CBC News