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MPI posts $30.9 million net loss for first six months
Increase in bodily injury and physical damage claims to blame.
October 17, 2016
Manitoba Public Insurance reported a net loss of $30.9 million for the six months of its fiscal year ending August 31, 2016 – a decrease of $47.4 million over the same time period last year.
This includes net loss to the Basic insurance line of business of $52.7 million in the first six months of the 2016/17 fiscal year.
Total earned revenue for the first six months was $597.7 million which is an increase of $34.7 million from the same period last year. This is mainly due to increases in motor vehicle premium revenue resulting from an increase in the number of motor vehicles insured and the value of these vehicles.
“The overall financial picture was affected by an increase of $193.7 million in total claims costs which was offset by an increase of $116.8 million in investment income,” said Heather Reichert, vice-president, Finance and Chief Financial Officer, Manitoba Public Insurance.
“Total claims costs included a $138.3 million increase in bodily injury claims and a $53.8 million increase in physical damage claims compared to the first six months of 2016. The bodily injury increase is primarily due to the interest rate adjustment on unpaid claims, however, an increase in collision claims is also negatively impacting claims costs.”
This past June, Manitoba Public Insurance applied to the Public Utilities Board for an overall increase of two per cent in Basic insurance premiums for the 2017/18 insurance year. In addition to an overall two per cent increase in Basic Autopac rates for 2017, the Corporation further requested that the Public Utilities Board consider introducing an Interest Rate Forecast Risk Factor, effective March 1, 2017.
“The form and magnitude of this (Risk Factor) is to be developed through a collaborative process with the PUB and intervenors,” said Reichert.
MPI posts $30.9 million net loss for first six months
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