Manitoba Public Insurance reported today that it completed its third quarter in a stable financial position, but warned that rising claims costs cloud its future.

For the period ended Nov. 30, 2002, the company reported net income of $23.1 million on revenues of $477.2 million. The results are up from $11.6 million in net income during the same period in 2001.

However, the corporation also noted that for the same nine-month period, collision claims increased more than eight per cent and injury claims have jumped by more than six per cent.

“Higher revenues in all of 2002 have given us a solid base as we enter the winter months, when claims costs are traditionally highest,” said Barry Galenzoski, Vice President of Corporate Finance and Chief Financial Officer. “Already in the last 90 days, total claims costs have risen 10 per cent – a development that deserves some attention.”

Overall, the number of collision claims has increased by more than 6,000 over the past year raising costs by $17.6 million to $140 million. The crashes have also contributed to nearly 700 additional injuries over 2001 levels when there were 10,356 injury claims.

“Not only are there more crashes but the costs associated with those crashes have increased on average nearly $100 to $1,786,’’ Galenzoski said. “That means Manitobans are crashing more often and with greater impact and that is reflected in an increase in the number of injury claims we’re seeing.”

Injury costs are being driven by soft-tissue injuries such as whiplash. A 12 per cent increase in the number of soft tissue injuries in the first nine months pushed costs of that injury type to more than $13.2 million.

Galenzoski warned that even a few days of severe winter weather can cause a sharp rise in claims costs and he challenged Manitoba motorists to play a role in helping keep their insurance rates under control.

“Because Manitoba Public Insurance only collects what it needs to pay out in claims, Manitoba motorists can influence the amount we need to collect through insurance premiums through their driving habits,” he said.

Last month, the Public Utilities Board ordered Manitoba Public Insurance to reduce auto insurance rates by one per cent in 2003/04. It will be the third rate reduction in five years ensuring Manitobans will continue to pay among the lowest auto insurance rates in the country.

Contact:
Brian Smiley/Twila Allen
Media Relations
Manitoba Public Insurance
(204) 985-7678/7300 or 1-888-554-9549 (toll-free in Manitoba)