The B.C. government has capped vicarious liability at Cdn$1 million for car rental companies and their insurers.
Changes will limit companies’ liability to $1 million for bodily injury and property damage claims and shift some responsibility to the driver, B.C.’s attorney general said in a press release.
The rental and leasing companies within the province currently face unlimited liability for accidents caused by their customers.
It is estimated that one-third of the vehicles on B.C. roads are leased.
The government said the changes were needed to bring B.C. in line with other jurisdictions and that the proposed law will help keep key businesses like car rental companies in the province to support major industries such as tourism, according to B.C. officials in a press release.
The U.S. eliminated vicarious liability for leasing and rental companies in 2005, and Ontario passed similar legislation last year.
Some B.C. drivers reportedly still carry only the basic minimum third-party liability coverage of $200,000.