The good news: Manitoba Public Insurance reported a net income of $64.5 million for the nine months ending November 30, 2013 – representing an increase of about $50 million over the same period last year.
The bad news: The "volatile" current environment of record claims being made in December and January may impact MPI rates beginning in 2015.
"It might be blue skies now in the third quarter," said MPI spokesman Brian Smiley, "but in the fourth quarter, there’s storm clouds."
In December, collision and injury claims were up 17 per cent from the same month last year. There have already been more than 16,000 collision claims in January.
"It would be premature to predict any rate increase for 2015," Smiley noted. "But right now it’s pretty volatile."
The MPI rate increase of 0.9 percent for 2014-2015 takes effect on March 1. Any impact of the current collision rates wouldn’t be factored into MPI’s rate application until 2015-2016.
The most recent $64.5 million net profit was buoyed by a "strong, one-time investment gain" within MPI’s $2.3 billion portfolio.
Claims incurred for the nine months preceding November 30, 2013 increased by $11.0 million, or two per cent, compared to last year, said MPI’s vice-president and CFO Heather Reichert. Physical damage claims incurred increased by $19.7 million or 5.5 per cent, while bodily injury claims incurred decreased by $8.8 million or 4.7 per cent.
"After three quarters of the year, the corporation is in stable financial position thanks primarily to a rebound in the investment markets," Reichert added. "But we are entering the final quarter already facing much higher than normal winter claims counts."