MPI proposes 6.8 percent rate decrease for 2012-2013 insurance year
Manitoba Public Insurance (MPI) is asking the Public Utilities Board to approve a rate application that would lower the basic auto insurance premiums for 900,000 Manitoba drivers next year.
The auto insurer proposed an overall average 6.8 percent decrease in premium revenue for the 2012-2013 insurance year, citing “unparalleled” rate stability.
“This proposed reduction was possible in large part to a reduction in injury claims costs, continued reduced theft costs and enhanced operational efficiency,” said MPI President and CEO Marilyn McLaren in a statement. “Recently, an external appointed actuary adjusted the expected future cost of long-term injury claims downward by approximately 20 per cent.
“This adjustment resulted in a surplus of $250 million which was returned to Manitobans. This adjustment in past, long-term claims also impacted future forecasts which is largely responsible for the proposed decreased future revenue requirements,” she added.
MPI said that if the application is approved, 91 percent of vehicles will receive reductions in their basic compulsory coverage. Seven percent will see no change to their premium and two percent of policies will be increased. MPI said that most increases will be less than 450.
AVERAGE ADJUSTMENTS IN REVENUE
| Major Use | Applied for Rate Changes |
| Private Passenger | -6.8% |
| Commercial | -7.9% |
| Public | -5.2% |
| Motorcycles | -10.3% |
| Trailers | -5.1% |
| Off Road Vehicles | -17.6% |
| Overall (applied for) | -6.8% |
MPI also released its 2010 Annual Report at the same time, in which it reported a net loss after surplus distribution of $22.3 million. For each business day in 2010, Manitobans filed an average of 1,079 claims, amounting to about $2.3 million in claims each day.
