The B.C. government announced plans Thursday to radically overhaul the province's vehicle insurance system by cutting lawyers out of the process through what it calls an "enhanced care" system.

The province claims that Insurance Corporation of B.C. premiums will drop by as much as 20 per cent — an average of $400 a year — as the insurer moves to introduce a system designed to redirect hundreds of millions of dollars spent in legal costs each year to directly benefit people injured in crashes.

The government plans to introduce legislation to create the new system, which would take effect on May 1, 2021. In the meantime, ICBC is promising that rates will not change this April.

"It's time for change at ICBC," Premier John Horgan said in a statement provided at a technical briefing to explain the changes.

"The old government ignored ICBC's problems, allowing it to become a system that made lawyers rich, while drivers paid too much for insurance."

B.C. Premier John Horgan and Attorney General David Eby announce plans for an ICBC overhaul in Victoria on Feb. 6. (Michael McArthur/CBC)

Fighting the financial 'dumpster fire'

The overhaul is the latest in a series of steps taken to counter ICBC's massive financial woes. Attorney General David Eby declared the corporation a financial "dumpster fire" when the NDP government came into power, blaming the previous B.C. Liberal government for amassing a deficit of $1.3 billion.

From the outset, Eby has targeted rising legal costs as a source of the problem. The government says legal fees amounted to $700 million in the current fiscal year, a figure projected to rise to nearly $1 billion by 2022.

But a court ruling last October blocked the province's attempts to save money by limiting the number of expert reports allowed in auto insurance lawsuits, forcing the government to look for other ways to cut costs.

Under the new plan, anyone injured in a car crash would be entitled to a maximum of $7.5 million in care and treatment benefits, opposed to the $300,000 limit currently available for care and recovery. However, the province says under extenuating circumstances the limit could increase.

The new legislation would require ICBC by law to assist every person who makes a claim and to ensure they receive all the care and benefits to which they are entitled.

Wage loss benefits will also rise by 60 per cent and new benefits — such as benefits for full-time students, caregivers and people working in family business — will replace lump-sum payments previously awarded through litigation.

Under the existing system, people who are not at fault for accidents can pursue additional benefits through the courts. The new care and recovery benefits would be available to anyone hurt in a crash, regardless of who was at fault.

'You shouldn't need a lawyer'

Officials at the technical briefing insisted the system would not be "no fault," stressing that premiums for drivers who were found to have caused accidents would still increase.

In a statement provided as part of the briefing, Eby said the so-called "enhanced care" system is designed to directly connect consumers to the benefits they pay for.

B.C. Attorney General David Eby speaks at a news conference after announcing plans for major changes to ICBC on Feb. 6. (Michael McArthur/CBC)

"You shouldn't need a lawyer to access the benefits you've paid for," Eby said.

"By removing expensive lawyers and legal fees from the system, we are making ICBC work for British Columbians again with more affordable insurance rates and much better coverage, so anyone injured in a crash gets the care they need."

'This is a don't-care model'

ICBC officials are expecting significant push-back on the new plan from B.C.'s Trial Lawyers Association.

John Rice, the president of the association, says the system will rob British Columbians of the right to pursue recourse for injuries as they see fit.

"This is about a failed policy and now they're looking to take away the legal rights of British Columbians," Rice said in an interview with the CBC's BC Today.

"This isn't a care model. This is a don't-care model. This is a law that tells British Columbians with brain injuries, spinal cord injuries, children with amputations and burns that their pain and suffering is worth nothing."

Rice also said he thought most drivers would not trust ICBC to determine an adequate lifetime payout for care and recovery.

The B.C. Liberal opposition echoed the trial lawyers' concerns.

"With today's announcement, the NDP just abolished your right to compensation for pain and suffering if you're injured in a car accident," Liberal Leader Andrew Wilkinson said in an emailed statement.

"Under this new scheme, if you're seriously injured in an accident the NDP will force you to deal with ICBC for the rest of your life, giving you no choice but to deal with the state-run monopoly."

But the government insists that consumers will still have recourse to dispute decisions on their claims, through the Civil Resolution Tribunal, the B.C. ombudsperson and a newly announced ICBC "fairness officer."

Drivers will also be able to sue anyone who is convicted of a criminal offence in relation to an accident and they will be able to sue car manufacturers and makers of automobile parts.

The new plan will bring B.C. into line with insurance schemes in Manitoba and Saskatchewan.

The province says it also anticipates that savings to payouts will eventually make ICBC premiums some of the lowest in the country.