MPI seeks to increase auto insurance rates by 2.2%
If approved by utilities board, driver of average passenger vehicle would pay $27 more next year
Manitoba drivers will see their auto insurance premiums rise by an average of $27 next year, if Manitoba Public Insurance get its way.
The public insurer made the request Friday in its general rate application to the Public Utilities Board. If approved, it would drive up insurance rates by what it calls a "modest" overall 2.2 per cent in 2019/2020. That amounts a $27 increase in premiums for the average passenger vehicle owner
"We fully recognize that our customers expect us to deliver comprehensive auto insurance coverage and service at rates that are affordable, predictable and stable over time. We believe this rate application continues to deliver on that mandate," said MPI president Ben Graham in a press release.
Individual rates vary based on the type of vehicle, use, rating territory and driving history.
547,166 vehicles (excluding trailers and off-road vehicles) could see a premium increase.
Proposed rates
- Private passenger - 2.4 per cent increase
- Commercial - 2.4 per cent increase
- Public - 0.6 per cent increase
- Motorcycles - 3.1 per cent increase
- Trailers - 4.7 per cent decrease
- Off-road vehicles - 20 per cent decrease
- Overall - 2.2 per cent increase
About 40 per cent of drivers can expect an increase of less than $50 annually, MPI says.
Last year, MPI hiked rates by 3.7 per cent.
What drives insurance rates up?
MPI justifies the insurance rate changes based on the most recent collision claims and damage reports. The corporation experiences higher physical damage costs tied to newer vehicles and rising collision claims at a rate of five per cent per year, MPI says, compared to an average of 2 or 3 per cent in previous years.
"Newer vehicles have a wide range of complex materials and driver assist technology features which are costly to repair or replace after a collision," said Graham. "Understandably, newer vehicles of today are more expensive to repair than vehicles a decade ago."
Manitoba's harsh winters and drastic weather affect the financial situation, MPI says. But reduced weather-related claims coupled with corporate cost containment makes for a modest rate increase.
Hail claims went down to 2,100 in 2017 from 11,000 in 2016 and 13,000 the previous year.
The rundown
MPI also released its annual report this week, showing an overall net income of $91.1 million for the past fiscal year, compared to $85.2 million in losses the year earlier.
Last year, Manitobans submitted an average of 1,203 claims every working day, which represents about $3.1 million in daily Autopac claims.
Proposed rates will come into effect March 1, 2019. Since renewal rates are staggered, MPI says some drivers won't pay the increased rates until Feb. 28, 2020.