Costs soar for technology overhaul at Manitoba's auto insurer
Though replacing aged system more expensive than planned, ratepayers won't pay the difference: minister
The cost of modernizing technology at Manitoba's auto insurance Crown corporation has jumped sharply.
Project Nova, which is aimed at letting customers and brokers do more business with Manitoba Public Insurance online, was originally expected to cost $86 million plus contingencies.
That number was bumped up to $115 million last year and, according to a memo obtained by the Opposition New Democrats, could reach $224 million plus contingencies.
The time to complete the project is expected to jump by about two years, according to the memo.
Kelvin Goertzen, the minister responsible for the Crown corporation, said replacing a system that is 20 or more years old is a bigger project than originally thought.
Security upgrades a focus
He said much of the extra cost is to ensure the new system is secure against data breaches, but it will not affect the rates motorists pay.
"They had to rescope the project. They recognized it's going to be a bit more in-depth than they thought," Goertzen said Thursday.
"There is an ongoing sort of set-aside of funds to pay for upgrades of technology ... and I've been assured this is a long-term plan that doesn't impact rates but will benefit service and ensure that the service is secure."
In a written statement, Manitoba Public Insurance said it has used outside consultants to plan the transformation and later found "unidentified gaps ... that were crucial to successfully completing Nova."
The corporation also said it has shared all the information with the Public Utilities Board, the provincial regulator.