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June 13 , 2008
1% overall decrease proposed for Autopac rates in 2009
Declining thefts help Manitoba Public Insurance hold line on rates for 10th year in 11
As auto theft continues to decline across the province, Manitoba Public Insurance is seeking a one per cent overall reduction in Autopac rates for the 2009/10 insurance year.
In its rate application filed today with the Public Utilities Board, the public auto insurer said the rate decrease is possible despite lower investment returns and higher expenses. Much of the credit goes to the dramatic downturn in auto theft. Thefts in the province have fallen by 40 per cent since 2004 and are expected to decrease by another 40 per cent by the end of next year.
This is the second rate decrease in three years, driven in part by reductions in auto theft. In 2007/08 Manitobans enjoyed an overall 2.6 per cent rate decrease, based largely on the expected results of anti-theft strategies.
"Over 300,000 vehicles in the province now have approved immobilizers, and Manitobans are beginning to reap the financial benefits,” President and Chief Executive Officer Marilyn McLaren said.
For the first five months of 2008, auto theft was down 43.9 per cent in Winnipeg, and 40.7 per cent overall for the province.
The resulting drop in claims costs is arriving just in time to help offset emerging financial pressures. In addition to slow investment markets, the corporation faces rising reinsurance costs, which have increased by approximately $1 million per year. The corporation continues to increase its level of protection for large catastrophic losses such as last summer’s hailstorm in the Dauphin area.
As Manitobans put more vehicles on the road, the corporation is seeing an increase in both revenues and expenses. The fleet experienced unprecedented growth of 3.17 per cent in 2007/08, which has resulted in higher premium and expense forecasts compared to last year’s rate application.
While the corporation is not applying for additional revenue in this rate application, some customers will pay more due to adjustments applied to various rate groups. Most vehicles will see their premiums change by less than $20 up or down. The average passenger vehicle premium will be $853.
The proposed rates would be effective March 1, 2009, but because renewal dates are staggered some vehicle owners wouldn’t pay the new rates until February 28, 2010.
AVERAGE ADJUSTMENTS IN REVENUE
Major Use |
Applied for Rate Changes |
|
|
Private Passenger |
-1.5% |
Commercial |
3.9% |
Public |
2.3% |
Motorcycles |
7.2% |
Trailers |
3.4% |
Off Road Vehicles |
-14.3% |
|
|
Overall (applied for) |
-1.0% |
Owners of touring-style motorcycles registered in Winnipeg will see an average rate decrease of 1.5 per cent, while owners of mopeds and motor scooters will experience a 25 per cent increase.
“The moped and motor scooter class has quadrupled in size over the last six years,” said McLaren. “This rate increase is due to an increase in claims costs attributed to these types of vehicles.”
With the increase, the average moped and motor scooter premium for 100-c.c. or less will be about $146.
Sport bikes registered in Winnipeg will see a 1.9 per cent increase.
“This rate application confirms our commitment to Manitobans,” said McLaren. “Over the last decade Manitoba Public Insurance has provided its customers with five rate decreases, four years of holding the line on rates and four rebates totalling nearly $300 million.”
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Contact:
Manitoba Public Insurance
Media Relations
(204) 985-7000 or 1-888-554-9549 (toll-free) |
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