Manitobans will pay an average of 1.54% more for MPI insurance starting April 1

The average Manitoba driver will see the amount they pay for insurance increase by 1.54 per cent in the spring, but rates could have been higher.

In July, Manitoba Public Insurance requested an overall rate decrease of 0.9 per cent, and in October revised that request to seek a 0.05 per cent rate decrease.

The Public Utilities Board, an arm's-length from government entity, instead ordered a rate decrease of 3.8 per cent effective April 1, according to a decision released on Wednesday.

However, Manitobans won't see a break on their insurance premiums because MPI also requested the removal of a five per cent capital release for this year, which was approved by the PUB.

Capital release is determined every year based on the state of the capital reserve fund, which helps MPI maintain rate stability and reduce increases for Manitoba drivers, according to the MPI website.

With the elimination of the capital release,, the average Manitoba driver will pay 1.54 per cent more on insurance rates, starting in April. The exact amount will depend on several factors, including their driving record; where they live; the make, model and year of their vehicle; and their purpose for driving it. 

Had MPI been granted the 0.05 per cent decrease it sought in October, rates would have increased by 5.54 per cent in light of the removal of the capital release.

MPI's rate application detailed significant increases in the Crown corporation's budget to pay for its major IT initiative "Project Nova" and 420 new staff positions compared to 2020.

The IT renewal project began in 2020 with a budget of $106.8 million, but that budget was increased to $128.5 million the next year.

The timeline for completing Project Nova has since been extended from three to five years, and the budget is now in a range of $257 million to $289.9 million.

The PUB said in its decision it ordered MPI to provide reports related to the IT project so it can monitor expenses.