Three out of four Manitobans will pay less for basic Autopac next year and everyone who paid for auto insurance in 2005-06 will receive a 10 per cent rebate, the Public Utilities Board ruled yesterday.

It will be the eighth year in nine that Manitoba Public Insurance has held the line or reduced basic Autopac rates without lowering customer service or reducing coverage. The rebate, ordered by the PUB today, is the third provided to vehicle owners in the last six years, bringing the total to $200 million.

“Today’s ruling confirms the strength of the public auto insurance system,” said Marilyn McLaren, President and Chief Executive Officer of Manitoba Public Insurance. “While insurance rates in other jurisdictions with private auto insurers are on the rise, Manitoba Public Insurance has provided nearly a decade of rate stability and about $200 million in direct payments to Manitoba vehicle owners in the form of dividend payments.”

For three out of four Manitobans, today’s ruling will provide a double bonus. As early as April 2007, all current vehicle owners who paid basic Autopac in 2005-06 will receive a rebate cheque in the mail that averages $100. Then, when most Manitobans renew their insurance throughout the 2007-08 year, 75 per cent of Autopac customers will pay less under the rates approved by the PUB.

The PUB upheld Manitoba Public Insurance’s application to reduce overall premium revenue by 2.6 per cent with two exceptions. It capped motorcycle increases at five per cent and moped rate increases at 25 per cent. The average family passenger vehicle premium will be $805 next year, a reduction of $25.

Overall, the ruling means that 644,000 vehicle owners will see their premiums decrease or stay the same when the new rates take effect on March 1, 2007. Because of staggered renewal dates, some vehicle owners will not pay the new rates until February 2008.

The PUB ruled:

• Premiums would decrease for 644,050 of the 864,086 policies. The reduction would be $40 or more for about 21 per cent of those receiving reductions. About 31 per cent would pay $30 less and 40 per cent would pay $20 less.
• Of the 19 per cent of customers who would pay more, about two-thirds would see increases of less than $20.

The rebate will be funded through the corporation’s Rate Stabilization Reserve (RSR), which is designed to cushion Autopac rates from unexpected cost fluctuations, and will therefore have no impact on the corporation’s future revenues.

The PUB ordered the rebate because Manitoba Public Insurance continues to demonstrate its financial stability. The regulator said lower claims costs and higher investment income has increased the RSR above the $69 million to $105 million range confirmed by the PUB yesterday. It also said a number of initiatives that Manitoba Public Insurance has embarked on – such as the Immobilizer Incentive Program and the Driver Licensing changes – should ensure future financial strength.

“Clearly, this ruling acknowledges the financial strength of Manitoba Public Insurance and the PUB ordered this payment to Manitobans, believing it would not put the corporation’s financial strength at risk,” McLaren said. “It is also recognition that we are doing the right things to stay that way into the future.

“This is a testament to the work we do to provide value to Manitobans every day.”

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Contact:
Media Relations, Manitoba Public Insurance
(204) 985-7300 or 1-888-554-9549 (toll-free in Manitoba)