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MPI seeks 2% increase in Basic Autopac rates
If the request is approved, 674,894 vehicles will receive a premium increase
Staff on June 20, 2016
After an unprecedented year for comprehensive (non-collision) claims payouts, Manitoba Public Insurance has asked the Public Utilities Board for a two per cent increase to Basic Autopac rates.
“Hail claims were the big driver in this increase, coming in $50 million over our projected forecast. Last year’s payout for comprehensive was $125 million, compared to the previous five-year average of $74 million,” Dan Guimond, MPI’s president and CEO, said in a release.
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MPI policyholders opened approximately 13,000 hail claims last year, more than triple of the 4,000 claims in 2014.
In addition to the higher than average payout, the low forecasted return on Canadian and U.S. investments contributed to the financial strain. Returns were 17.1 percent, or $14 million, or below previous forecasted amounts.
MPI has already received a transfer of $72.7 million to help stabilize its operations.
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If its request is approved by the board, 674,894 vehicles will receive a premium increase. The majority (83 percent) of premiums would increase by $40 or less, with the average passenger vehicle owner paying about $17 more in premium.
“Higher claims costs and a negative financial climate resulted in the Corporation seeking a small overall rate increase for next year,” said Guimond. “Manitoba Public Insurance collects premiums to reflect projected claim costs, and we are addressing the business reality that claims costs are continuing to rise.”
MPI seeks 2% increase in Basic Autopac rates
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