MPI seeks 0.9 per cent overall rate decrease

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This article was published 12/07/2022 (1213 days ago), so information in it may no longer be current.

Owners of private passenger vehicles in Manitoba could see their insurance rates drop next year, while commercial truck drivers and motorcyclists will see them drive up.

Manitoba Public Insurance announced Tuesday it is asking the Public Utilities Board to approve an overall decrease of 0.9 per cent for insurance renewals in 2023-24.

Mark Giesbrecht, vice-president and chief financial officer, said, if approved, the new rates would begin April 1, 2023.

“During this time of widespread volatility in financial markets, as well as increasing inflation, we are pleased to be in a position to request a rate decrease for Manitobans as a result of the corporation’s ongoing prudent fiscal management,” Giesbrecht said at a news conference.

Giesbrecht said while it overall totals a 0.9 per cent decrease, within different classes of vehicles there are ups and downs, including a 0.4 per cent drop for private passenger vehicles, a 3.7 per cent rise for commercial vehicles, a 1.6 per cent increase for motorcycles, and a drop of 8.6 per cent for trailers (including campers).

On top of this, he said, with a new 17th level on the driver safety rating system, the safest drivers would see an additional 0.6 per cent reduction on their insurance rates, no matter what class of vehicle they own.

Giesbrecht said there are currently no plans to implement a “first accident free” system like some American automotive insurers have in recent years, where there is no loss of points or discounts for motorists at the top of the DSR scale.

“We are expanding the scale, which would in effect offer that in some way,” he said.

“The long-range plan is to get to 20 levels to really offer the best benefits to our safest drivers. Right now, if you are at level 15 and you have an accident, you drop simply five points in the scale. Allowing us to go to 20 points would have a greater buffer and not have it impact as far as the discount applied based on where you land on the scale.

“(But) right now, that specific act of forgiveness is not part of this application.”

Giesbrecht said the overall rate reduction — which would mark the fourth consecutive annual drop — is due to “emerging claims trends” and “MPI’s rate stabilization reserve.”

Meanwhile, he said MPI policy holders can no longer look forward to large rebate cheques landing in their mailboxes. The Crown corporation returned a total of $69 million in December 2020, $110 million in May 2020, and $312 million in February 2022.

Giesbrecht said the COVID-19 pandemic and its government isolation orders caused the number of collisions fall dramatically with fewer motorists on the road, but that is changing.

“As many Manitobans have returned to previous driving behaviours, so too have our overall claims and subsequently our financial forecasting, as reflected in this year’s application.”

Giesbrecht said MPI is also asking the PUB for permission to scrap the capital release provision, which gave a five per cent discount to overall rates.

“The capital release was a one-time discount based on the state of the corporation’s capital reserve fund when rates were being determined,” he said. “All of the corporation’s excess capital has now been returned to Manitobans through the last round of rebates.”

PUB hearings are scheduled to begin in October, with a ruling expected in December.

kevin.rollason@freepress.mb.ca