Prior to the changes in B.C., lessees would typically arrange and pay for the vehicle licence and insurance for their leased vehicles; however, lessors would need to provide written authorization to allow these lessees to conduct these transactions on their behalf.

Among other challenges, before the changes, lessees could not renew their insurance online and were limited in their choice of insurance brokers.

With the amendments in effect, lessees are able to purchase, change, renew and even cancel the vehicle licence and insurance for their leased vehicles.

Lessees, rather than lessors, will be the vehicle licence holders and the insurance policyholders, reducing administrative burdens for both parties. Lessors will still be an insured under the policy and will still be protected in the same way they are today. Lessors will also continue to be the registered owner of the leased vehicles, and vehicles cannot be sold or transferred, except by their lessors.

Lessors who wish to renew or increase insurance coverage for an uninsured or underinsured vehicle must present a signed ICBC letter of authorization (LOA) from the lessee. The LOA is a fillable form available only from ICBC. The LOA will be irrevocable and valid for the duration of the lease; it must be kept by the lessor and provided to the broker at the time of any transaction for which the LOA is required.

Once a lessor obtains a signed LOA from the lessee, the lessor can use it to:

• Renew an expiring or expired policy

• Increase or add coverage at the time of renewal

• Increase or add coverage during the term of the policy

The lessor will not be permitted to make any other changes.

The LOA cannot be used to take out a new Owner’s Certificate of Insurance and Vehicle Licence. However, if an insurance policy has been cancelled, the lessor can purchase a storage policy for the vehicle, and a LOA is not required.

Any amount payable as a result of the renewal or change in coverage must be paid in full by the lessor at the time of the transaction and any amount owing to the lessor should be discussed with the lessee. We will not collect any premium on the lessor’s behalf.

The LOA will include the following details:

• The names of the lessor and lessee

• Vehicle details (e.g., year, make, model, VIN)

• The term length of the LOA, which will coincide with the term of the lease

The LOA will specify that the lessor:

• May add or increase coverage

• May not remove or decrease any coverage

• May not cancel a vehicle licence or insurance policy

• May not make any other changes to the policy, such as the listed drivers, rate class, territory, or address.

• Will receive a copy of the Owner’s Certificate and Vehicle Licence (APV250)