Due to the abnormally long winter, an increase in bodily injury claims costs and lower investment income compared to the previous year, Manitoba Public Insurance reported a net loss of $33.9 million for the three months ending May 31.
“A moderate increase in claims experience combined with lower than expected investment income has resulted in the first quarter loss,” said Heather Reichert, Vice-President Finance and Chief Financial Officer, Manitoba Public Insurance. “Investment income decreased $7.1 million compared to the first three months of last year.”
Earlier this year, Manitoba Public Insurance applied for a modest rate increase of 1.8 percent. Nearly 70 percent of vehicles will increase or decrease by $20 or less for the 2014/15 insurance year which takes effect March 1, 2014.
Total claims costs increased $53.3 million for this year’s first quarter compared to last year, explained Reichert. This increase was primarily due to two factors:
- an increase of $36.3 million in bodily injury claims costs, which was largely a matter of timing and not expected to affect year end
- an increase of $13.8 million or 13.2 percent in physical damage claims incurred because of the winter weather that extended well into late April
“The corporation will continue to closely monitor its financial results,” said Reichert. While no one can predict the impact that future weather may have on claims costs, all other factors are expected to track well to budget. MPI is committed to rate stability for Manitoba drivers – for 14 of the last 15 years, the Corporation has either held the line, or reduced rates.”
Deloitte has confirmed that Manitoba’s public auto insurer provides among the lowest insurance rates in Canada, Reichert noted.
