The Province of British Columbia has passed Bill 28/2023, the Motor Vehicle Amendment Act, which marks a significant step toward enhancing the efficiency of insurance transactions on leased vehicles, benefiting both lessors and lessees.
Under the current system, the responsibility for arranging and covering the costs of vehicle licensing and insurance for a leased vehicle often falls on the lessee. However, the lessor must provide written authorization for the lessee to execute these transactions on their behalf. This process poses challenges, restricting lessees from using online insurance services and limiting their choice of insurance brokers.
Expected to be implemented in the summer of 2024, the upcoming changes will empower lessees by allowing them to purchase, modify, and renew insurance for the vehicles they are leasing. This can be accomplished through any of the 900+ brokers or convenient online insurance services. Additionally, lessees will become vehicle licence holders and insurance policyholders, alleviating administrative burdens for both lessees and lessors.
Despite these changes, lessors will maintain their current role as the registered owners of leased vehicles. This means that vehicles cannot be sold or transferred except by the lessor. These modifications not only simplify the insurance process but also align British Columbia with insurance frameworks in other Canadian jurisdictions.
ICBC is planning to schedule information sessions for lessors and brokers this spring.
For further info on Bill 28/2023, click here.