Bolstered by recent news that Winnipeg has the lowest automobile insurance rates among all major Canadian cities, a stable first quarter confirms that Manitoba Public Insurance continues to perform at a high level for Manitobans.
Meanwhile, Manitoba’s public auto insurer reported net income of $30.1 million for the three months ending May 31, 2012 compared to net income of $44.2 million for the same period last year, said Heather Reichert, Vice-President Finance/Chief Financial Officer, Manitoba Public Insurance.
Claims costs increased by $13.2 million compared to last year due primarily to bodily injury claims incurred that increased by $7.1 million and physical damage claims incurred rose by $5.6 million.
Total earned revenues for the three months increased from the previous year by $7.2 million. This increase is primarily attributed to motor vehicle earned revenues which increased by $4.6 million or 2.2 percent, due mainly to increases in the number and value of vehicles insured. Revenue from drivers’ premiums also increased during the three months by $1.1 million.
Net income decreased from the previous year by $10.9 million due to a decline in underwriting results of $9.1 million (due mainly to increased claims costs), a $1.2 million rise in investment income as realized and unrealized gains on bonds increased and a one-time gain on disposal of property of $3.1 million in 2011/12.
Lowest Insurance Rates
“An auto insurance rate comparison of all major cities, confirmed that Winnipeggers are receiving the lowest rates in Canada,” said Reichert. “A 35-year-old couple, with a 15-year clean driving record, would pay more than $1,400 in St. John’s, compared to less than $1,000 in Winnipeg.”
Young Manitoba drivers particularly benefit from the public auto insurance program. For example, a 21-year-old male – with five years clean driving – would pay $3,000 auto insurance yearly in Calgary, while in Winnipeg the premium costs would be about $1,100.
Rate Stability
Last month, the corporation submitted its Basic insurance rate application to the Public Utilities Board – no overall rate increase for the 2013/14 insurance year. The PUB is expected to rule on the application by December.
Pending approval of the application, nearly 25,000 passenger vehicles in northern Manitoba will experience a reduction in Basic Autopac premium. This will be the third consecutive year these communities have received rate decreases. The application also requests rate decreases for a total of 8,205 motorcycles in the province.
“The Corporation remains committed to achieving its corporate goals and best serving our customers,” said Reichert. “Actual results will be closely monitored, and corrective actions taken when necessary, to ensure that expected outcomes are realized.”
