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June 6, 2001
Manitoba Public Insurance lowers
rates Manitoba Public Insurance (MPI) today applied for auto insurance rates that will see Manitoba motorists continue to pay among the lowest rates in Canada. In an application filed with the Public Utilities Board (PUB), MPI requested an overall premium revenue reduction of 1.2 per cent. If approved, this would be the fourth consecutive year in which MPI has applied for an overall revenue decrease. The cut comes as Manitobans share a one-time 16.6 per cent discount that is leaving $77 million in the pockets of all vehicle owners this year. "The average premium being proposed by MPI for 2002 is $549 - that is $3 less than the average premium was in 1998," said MPI CEO and President Jack Zacharias. "How many things are cheaper today than they were in 1998 -- certainly not buying a new vehicle or filling it with gas. "This rate application ensures Manitobans will continue to pay among the lowest auto insurance rates in Canada," added Zacharias. "This continues a four-year trend that has left more than $105 million in the pockets of Manitoba families." Stable rates If approved by the PUB, the base insurance rate for 437,529, or 55 per cent, of vehicle owners will be the same or less than it was before the 16.6 per cent one-time discount was applied. For most motorists in this group, the decrease will be between $20 and $50. For the 2002/03 insurance year:
Of the vehicles that will receive experienced-based increases because of higher claims costs, most will be less than $20. The proposed rates will take effect March 1, 2002 but because of staggered renewal dates, some vehicle owners will not pay the new rates until February 2003. Virtually every region to pay less The base rate in virtually every region of Manitoba is lower with this rate application:
As always, individual rates will vary depending upon risk factors such as vehicle make and model, how and where it is driven, and the owner's driving and claims records. Keeping rates fair Driver experience and the elimination of cross-subsidization continue to be major factors in determining what individuals pay for insurance. MPI strives to ensure every Manitoban pays their fair share of auto insurance rates. That means vehicle groups that cost more in claims face higher premiums. Increases in claims costs mean premiums paid by commercial vehicle and motorcycle owners will increase by 11.5 per cent and 15 per cent respectively. At the same time, 125,000 owners of trailers and off-road vehicles will be receiving premium decreases to better reflect their claims costs. This revision reflects a request by the PUB. Building on success MPI's annual report, which was tabled in the provincial Legislature today, demonstrates the Corporation's continued financial strength and stability. An expanding vehicle fleet and Manitobans purchasing newer vehicles have contributed to the corporation's success. Net income from the Basic Autopac program was $38.1 million for the last fiscal year. When revenues from MPI's competitive lines of business - Autopac Extension and Special Risk Extension - are included, net income was $46.5 million. Manitobans filed on average 895 insurance claims every working day at a cost of about $1.5 million per day. For every $1 paid in insurance premiums in 2000, Manitoba Public Insurance returned 91 cents in the form of claims benefits to customers. Manitobans benefited from the Corporation's efficiency and successful investment strategy. MPI's operating cost was less than 58 per cent of the Canadian industry average. As well, MPI's investment strategy meant that interest earned from money invested until it is needed to pay out claims reduced the premium paid by every policyholder by $94. As Manitoba Public Insurance moves through its 30th year of operations, it continues to achieve the objectives for which it was initially established and to meet the needs of its customers with affordable, accessible and outstanding automobile insurance protection. For more information about MPI's PUB Application, please visit our Newsroom on this Website. Contact:
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