Manitoba Public Insurance reported a net income of $3.7 million for the first three months of its fiscal year ending May 31, 2016 – a decrease of $19.3 million over the same time period last year. This includes a net loss to the Basic insurance line of business of $5.0 million in the first quarter of the 2016/17 fiscal year.
Total earned revenues for the first three months rose by $14.2 million from the same period last year, driven mainly by increases in motor vehicle premium revenue due to an increase in the number of motor vehicles insured and the value of these vehicles.
“The overall financial picture was affected by an increase of $85.4 million in total claims costs – including a $58.2 million increase in bodily injury claims and a $15.3 million increase in physical damage claims compared to the first three months of the 2015/16 fiscal year,” said Heather Reichert, vice-president, Finance and Chief Financial Officer, Manitoba Public Insurance.
“While the bodily injury increase is primarily due to an interest rate adjustment on unpaid claims, an increase of 1,380 collision claims over this period also negatively impacted claims costs. The Corporation remains committed to achieving its corporate goals and best serving our customers,” said Reichert.
In June 2016, Manitoba Public Insurance applied to the Public Utilities Board for an overall increase of two per cent in Basic insurance premiums for the 2017/18 insurance year. This increase is driven by an unprecedented year for comprehensive (mostly hail) claims and lower investment returns. If approved, this would be only the third time in 10 years that Manitoba’s public auto insurer has requested a rate increase. Rates have in fact decreased by 11.8 per cent over the past 10 years.