Winnipeg Free Press - PRINT EDITION

MPI driving for higher rates

Seeking 5% hike after record auto collisions

  • Print
Our horrible winter led to numerous motor vehicle collisions and a record number of claims to Manitoba Public Insurance.

RUTH BONNEVILLE / WINNIPEG FREE PRESS FILES Enlarge Image

Our horrible winter led to numerous motor vehicle collisions and a record number of claims to Manitoba Public Insurance. Photo Store

Following a record-setting winter for collision claims, Manitoba Public Insurance is eyeing a significant hike in Autopac rates for 2015.

MPI will seek a general rate increase of about five per cent when it appears before the Public Utilities Board next month, sources told the Free Press.

Huge collision claim costs caused the corporation to sustain another big annual loss for the fiscal year ended Feb. 28. One source said the deficit was even larger than the $48.1-million loss MPI posted the previous year.

Last year, MPI applied for a rate increase of 1.8 per cent when it appeared before the PUB, but the regulator ordered an increase of just half that -- 0.9 per cent -- saying the auto insurer needed to do more to control its costs.

Brian Smiley, a spokesman for MPI, said it was premature to comment on the Crown corporation's PUB submission.

"We are still producing our general rate application. It's very preliminary to speculate whether there will be a rate increase," he said Friday.

'One of the things we noticed is that the severity of these collisions increased, meaning there were more vehicles written off and greater levels of damage to the vehicles'

-- MPI spokesman Brian Smiley

He also wouldn't comment on the corporation's financial performance this past fiscal year. "We're still in the midst of reviewing our numbers at this stage," he said.

MPI publishes its annual report in mid-June.

Smiley did say MPI received 56,000 collision claims for December, January and February -- about 6,000 more than the same three-month period a year earlier.

"One of the things we noticed is that the severity of these collisions increased, meaning there were more vehicles written off and greater levels of damage to the vehicles," he added.

The rate hike would be only the third in 15 years imposed by MPI.

Progressive Conservative house leader Kelvin Goertzen said Manitoba consumers are already "tapped out" because of increasing hydro rates and higher taxes, including last year's percentage point increase in the PST.

"They (the government) like to brag about how things are low-cost in Manitoba, but that's not the reality of what people are facing with their bills. They're facing increases on everything that the NDP touch," he said.

Andrew Swan, minister responsible for MPI, hinted last month the corporation would seek a rate increase for the coming year because of high claims.

Swan also justified a recent $50,000 MPI consulting contract to its former CEO, Marilyn McLaren, saying her advice would prove "very helpful" in guiding the corporation through the PUB application process.

Goertzen noted the PUB has repeatedly rebuked MPI for its high administration costs.

Instead of preparing Manitobans for a rate hike, Swan should have been giving them some confidence the corporation is doing everything it can to minimize the costs that are under its control, the PC MLA said.

Byron Williams, a lawyer representing the Manitoba branch of the Consumers' Association of Canada, said MPI's staffing and information technology (IT) costs have been a concern to the CAC for some time.

He questioned whether one bad winter for collisions is reason enough for MPI to seek a rate hike for 2015.

"The hard winter might affect the adverse results for the 2013-2014 (fiscal) year," Williams said. "But unless there's something systemic going on, it wouldn't be an explanation for (rate hikes) going forward."

Williams noted MPI has significant reserves in place to smooth out such bad years.

As of Nov. 30, the corporation's rate-stabilization reserve stood at $172 million, according to its third-quarter report. MPI's total retained earnings -- savings -- were close to $390 million.

What's more, before the harsh winter hit, MPI's profits were a handsome $64.5 million through the first nine months of the fiscal year.

The final three months are usually the most expensive for MPI, however, and this past year was no exception.

larry.kusch@freepress.mb.ca

Republished from the Winnipeg Free Press print edition May 10, 2014 A3

Fact Check

Fact Check

Have you found an error, or know of something we’ve missed in one of our stories?
Please use the form below and let us know.

* Required
  • Please post the headline of the story or the title of the video with the error.

  • Please post exactly what was wrong with the story.

  • Please indicate your source for the correct information.

  • Yes

    No

  • This will only be used to contact you if we have a question about your submission, it will not be used to identify you or be published.

  • Cancel

Having problems with the form?

Contact Us Directly
  • Print

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

Have Your Say

New to commenting? Check out our Frequently Asked Questions.

Have Your Say

Comments are open to Winnipeg Free Press print or e-edition subscribers only. why?

Have Your Say

Comments are open to Winnipeg Free Press Subscribers only. why?

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010.

letters

Make text: Larger | Smaller

LATEST VIDEO

Keri Latimer looks for beauty in the dark and the spaces between the notes

View more like this

Photo Store Gallery

  • Marc Gallant/Winnipeg Free Press. Local/Standup- BABY BISON. Fort Whyte Centre's newest mother gently nudges her 50 pound, female bull calf awake. Calf born yesterday. 25 now in herd. Four more calfs are expected over the next four weeks. It is the bison's second calf. June 7, 2002.
  • A baby Red Panda in her area at the Zoo. International Red Panda Day is Saturday September 15th and the Assiniboine Park Zoo will be celebrating in a big way! The Zoo is home to three red pandas - Rufus, Rouge and their cub who was born on June 30 of this year. The female cub has yet to be named and the Assiniboine Park Zoo is asking the community to help. September 14, 2012  BORIS MINKEVICH / WINNIPEG FREE PRESS

View More Gallery Photos

Poll

What's your take on a report that shows violent crime is decreasing in Winnipeg?

View Results

View Related Story

Ads by Google