 Today a new leader is at the wheel
of Manitoba Public Insurance,
helping us navigate the road
ahead. On these pages, she
discusses the corporation’s
progress, our future destinations
and our plans for moving forward.
Marilyn McLaren became President
and Chief Executive Officer of
Manitoba Public Insurance in October
2004, succeeding Jack Zacharias after
his 10 years at the helm.
She assumes this role at a time of
significant change and opportunity. The
integration of Driver and Vehicle
Licencing in 2004 signals new potential
to add value for Manitobans. Supporting
these prospects are the corporation’s solid
financial performance and the proven
advantages of public auto insurance.
Q | These are interesting times for the industry.
In other provinces, relations between auto insurers
and drivers have been very contentious. What does
this mean to Manitoba Public Insurance?
A | At times like this we appreciate just how fortunate we
are to live in a province with public auto insurance. We
have our share of challenges and we always will, but
we can deal with them because we have the right
fundamentals in place. We aren’t hamstrung by profit
motives and worries about share price. We aren’t
searching for the magic answer that will make our
system work. We’ve had the answer for 33 years.
While other provinces are struggling to fix their broken
insurance systems, we’re moving ahead.
Q | You’re very proud of our public auto insurance
system. What makes it work?
A | In my opinion, it’s the most direct, most
transparent, most effective route to what every
province in this country is trying to achieve—
guaranteed access to auto insurance.
Provinces without public auto insurance try to
guarantee access in various ways. They control the
price, the underwriting rules and the coverage. They
set up things like facility associations to guarantee
access, but they provide a very low level of coverage,
typically $200,000 of third-party liability coverage.
That level of coverage can financially devastate
drivers and anyone they may hurt.
Provinces like Manitoba take a much cleaner
approach. We’ve set up not-for-profit agencies that
aren’t allowed to turn anyone away. We specify by law
the mandatory, universally available coverage people
can expect to receive. We’re also providing access to a
higher level of coverage.
And, of course, there are built-in efficiencies. There is
no obligation to pay financial returns to shareholders,
or to spend a lot of money enticing consumers to buy
your product. It works very much like a co-operative,
in that members fund the system.
Q | What sets Manitoba’s system apart?
A | Low premiums certainly differentiate us from the rest of the
country. But what really set us apart are our low
deductibles.
More than 80 per cent of our driving population carries a
deductible of $200 or lower—something you won’t find in
any other jurisdiction. In most parts of the country,
deductibles of $1,000 or more are becoming the standard.
For most people, a $1,000 deductible is a huge financial risk.
Manitobans don’t have to face that kind of financial volatility.
Q | “Value” is a word we often hear.
What does it mean to this corporation?
A | In the past year, the cost of auto insurance has
been a big issue in many parts of Canada. Our
low insurance rates are important to Manitobans
but price isn’t the only way they define value. For
example, ask Manitobans if they would trade off
quality coverage for low cost, and they’ll pick
coverage every time. They also care about the
quality of service and access to our products and
services. We have to find the right balance of all
four of these factors—price, coverage, service
and access.
Q | What sort of questions should we be addressing
now if we are to maintain that balance?
A | Our programs have to keep pace with Manitobans’
evolving needs and priorities. Consider those low
deductibles I mentioned earlier. Manitobans are
buying them because they want that kind of
financial stability and we can provide them at a
good price. But lower deductibles also mean more
claims and processing, and that means higher
operating costs. It’s all part of the value equation
that we have to work with Manitobans to
continually redefine.
Q | You’ve been with the company for more
than 25 years, progressing through many
different positions and areas of the
company. Have you learned anything
new about the corporation since
becoming president?
A | I’ve learned more about the challenges
confronting the people on our front lines—
the people who must deal with the
onslaught of claims following a severe
winter storm, or the
unprecedented number of brain
injuries we saw in Manitoba in
2003. I’ve been struck by not only
the pressures associated with those
challenges, but the actual depth of
an organization that can continue
delivering high-quality,
comprehensive service in the face
of those challenges.
Q | Auto theft is a big problem all across
Canada. How is it affecting Manitoba Public
Insurance?
A | Auto theft creates extra cost for the
corporation, but what really concerns me is the
cost to the community. A stolen vehicle can be a
terrible hardship. You wake up in the morning
to find your car gone. You can’t get your kids to
day care, you’re late for work, you can’t take
your mother to her medical appointment. And
when your car is recovered, you can never know
exactly what it’s been subjected to.
About 10,000 drivers are victimized this way every
year. Add to that the inconvenience of their family
members, and the danger to anyone who happens to
encounter a stolen vehicle or a theft in progress, and
you have a problem that affects a very large segment
of our population.
On top of that, every year we see people seriously
injured or killed because of crashes related to auto
theft. And young auto thieves are derailing their lives
because they’re making some really bad decisions as
young as age 13. Those are the issues around auto
theft that I think are absolutely critical.
Q | What’s it going to take to turn this
problem around?
A | We’re working with law enforcement
and community groups to tackle all
aspects of the problem, from
rehabilitation to the root causes. This
year we created a new position, Director
of Auto Theft Prevention, to bring
stronger co-ordination to these efforts.
The bottom line is that vehicles are
stolen because they can be stolen. It’s
been proven that the only real solution
is to equip vehicles with electronic
ignition immobilizers. In 2004
Manitoba Public Insurance solidly made the
case for why immobilizers are necessary. In
2005 we need to talk about how to convince
people to use them.
When the federal government recently
introduced its bill making immobilizers
mandatory in all new vehicles by 2007, it
acknowledged that this is a national
imperative. But we need to move faster—
particularly in Manitoba, where we tend to
drive older vehicles. We also have to keep this
issue in perspective. In this province, auto
theft is almost entirely a Winnipeg problem.
Q | This was the year that Driver and Vehicle Licencing
merged with Manitoba Public Insurance. What does the
integration of these services mean to Manitobans?
A | Manitoba Public Insurance has long maintained that
integration of our two operations would be a good thing. In
its ruling this year, the Public Utilities Board agreed. This
amalgamation allows us to cover a much broader spectrum
of services, all aimed at bringing greater safety and certainty
to the use of our roads and our quality of life here in
Manitoba. Safe driving has always been one of our main
concerns, for both business and societal reasons. Now we’ll
have more of the factors at our control. It’s also going to
mean better alignment of our insurance and licencing
systems, with more potential to enhance customer service
through technology and scale.
Q | Does efficiency mean job loss?
A | We’ve made a written commitment
that no permanent jobs will be lost as
a result of this amalgamation. Many
people are planning to retire within
the next few years, and that’s going
to open new and better opportunities
right across the corporation. The
work of some people will change and
change is never easy, but our newest
employees have been very willing to
learn about us and work with us. I
really appreciate their trust and openmindedness,
and I am confident that
everyone will be accommodated.
Q | So where does the integration go
from here?
A | In 2005 we’ll be working very
aggressively on a business process
review that will help us determine
where the best opportunities are and
which ones we should pursue first.
One thing is certain: We have an aging
driver’s licence system and an aging
licence photo system that have to be
dealt with. We have teams working
right now to figure out how to best
address those urgent requirements.
When the integration is completed,
I think Manitobans will see the most
tangible improvements in the area of
road safety. For example, we have
the opportunity to forge much
stronger links between the financial
incentives for good drivers in our
insurance programs, and the
monitoring and corrective efforts of
our Driver Improvement and Control
Program. By working together, we
can provide much stronger incentives
for the kind of safe road behaviour
that everyone wants and supports.
Q | This year Manitoba Public Insurance developed a new mission
statement—“Working with Manitobans to reduce risk on the road.”
How does this change reflect the corporation’s changing role?
A | In most ways, the new mission statement is similar to the old one
(“Protecting Manitobans from the human and economic cost of
automobile accidents”). Both speak about insurance protection.
Both speak about mitigating financial risk and the likelihood of
serious injury. But the old mission statement didn’t reflect our new
responsibility for Driver and Vehicle Licencing.
And perhaps more importantly, it didn’t reflect the importance of
partnership. We can’t protect Manitobans from the hazards of the
road on our own. Nor should we pretend we can. Shared
commitment and individual action are what keep our roads safe.
Q | What do you see as the role of this
corporation in the community?
A | Our economic impact is immeasurable.
In broker commissions alone we add
$51 million to the provincial economy
each year. Last year we generated over
$243 million in payments to repair
shops and medical practitioners. As one
of Manitoba’s largest corporate citizens,
we are also proud supporters of many
community-based organizations.
More importantly, the people of
Manitoba Public Insurance are a force to be reckoned with. We’re
1,700 people who keep
donating more to the
United Way every year,
1,700 people who respond
to causes like the tsunami
relief, 1,700 people who
contribute time and energy
to help our communities
thrive. It feels exciting to
be part of an organization
like that, and I know we
have enormous potential
to do even more.
Q | What’s the greatest challenge
facing our employees right now?
Where does the corporation need
to focus its energy?
A | We’re in an enviable position.
Elsewhere in Canada, the private
auto insurance business has been
experiencing a crisis of confidence.
But for this corporation, there are
no burning platforms or
insurmountable difficulties ahead.
Our priority right now is to simply
keep proving to Manitobans that
their confidence in us is well-placed.
There are some pressing difficulties in
terms of issues like auto theft, and
making sure we can maximize the
opportunities of our integration with
Driver and Vehicle Licencing. And it’s
always a challenge to keep evolving
with the times, as Manitobans’
expectations and the environment
change. But in terms of where our
attention needs to be, it’s always our
core business. That means continuing
to provide the value and the high quality
products Manitobans have come to
expect and, on the claims side, servicing
our customers as no one else does.
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