ICBC Cost-Saving Changes Agitate Auto Glass Shops

cost saving on windshield repairs

ICBC, the crown corporation for auto insurance in British Colombia made a recent announcement to change their policy for auto glass insurance.

The changes include raising car insurance by 25 per cent which would adversely affect the income of the car windshield manufacturers and repair companies.

Mc Cormack, President of Automotive Retailers Association (ARA), stated that the hike was implemented without consulting the ARA and that the policy would require repairing companies to use least expensive, low-quality windshield for replacement as it is losing its income.

The change implies that hundreds of windshield repairing businesses would be losing more than 5% of their cut. Some smaller companies would even be reduced to zero profit, leading to business closing down and laying off employees.

The shortage of employees would then affect the efficiency of the business and the quality of repair. Lower income would mean a cheaper variety of windshield and longer duration for vehicle owners to go without their cars. But these claims made by the group representative of auto glass repair shops were counteracted by ICBC.

While using cheap windshield would affect the insurance of vehicle owners, ICBC will be gaining the lion’s share of the profit. In return, the number of windshields that need repair and replacement will increase and run customers at a loss.

ICBC has been struggling financially and had been aiming to recover the $40 million and $96 million they had lost in glass repair and replacement in the year 2008 and 2017 respectively.  But the implementation of such policy is atrocious for windshield business as they will be the main losers.

Many business owners like Kelly Fleming from Sun Creek Class in Surrey have no other option but the hard decision of laying off skilled employees, cutting down expenses and is losing sleep over it.

However, the spokesperson for David Eby’s ministry stated that by increasing the savings of ICBC, the pressure on auto insurance rates for vehicle owners would reduce and stabilize the financial status of ICBC.