Will my ICBC debt go away if I file a bankruptcy?

2021-02-16   minute read


Bankruptcy can provide relief for most types of consumer debt, save for a few noteworthy exceptions. Therefore, you can — in most cases — include a debt owing to the Insurance Corporation of British Columbia (ICBC) in a bankruptcy. However, each situation is different and ICBC will take a position based on the facts of each file. Following are some examples of common bankruptcy situations and how ICBC is likely to deal with these debts:

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AutoPlan12 (monthly financing)

If you owe ICBC for outstanding AutoPlan12 payments and include these in a bankruptcy, ICBC will no longer allow financing going forward. You will still be able to purchase insurance, but you must prepay either annually or in three-month increments. Your payments must also be in the form of cash, credit card — which we strongly discourage, given the bankruptcy — or certified payment. 

Judgments | Amounts owing to ICBC for motor vehicle accidents

If you owe a judgement to ICBC due to a motor vehicle accident, ICBC will look at the facts of your case to determine the following:

  • Were you cited for negligent or reckless conduct (e.g. impaired / dangerous driving)?
  • Have you made legitimate efforts to work with ICBC to pay off the debt?
  • Is ICBC the primary creditor (i.e. 75 percent of the debt, or in excess of $50,000)?

It’s likely ICBC would oppose your discharge from this debt and seek a Conditional Order of Discharge. This could result in your needing to repay part or all of this debt before exiting bankruptcy. We discussing further with a Licensed Insolvency Trustee during your Free Confidential Consultation for a more detailed explanation.

Debts that won’t go away with bankruptcy:

As above, there are certain debts that won’t go away with a bankruptcy. As it pertains to ICBC, these may include:

  • Debts incurred by a convicted fraud, which is supported by Court proceedings
  • Court Services Fines, Criminal Code Fines, Court Ordered Restitution and Federal Contravention Fines
  • Driver Point Premium, Driver Risk Premium, and Multiple Crash Premium programs

ICBC may cancel or refuse to issue licenses and insurance

It’s important to note that even if you’re able to include ICBC debts in your bankruptcy, ICBC retains the right to cancel or refuse to issue licenses and/or insurance during the proceeding. You may make a written request to ICBC to reconsider this decision, but all exceptions are at their discretion. 

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