Manitoba’s public insurer says claim costs were down 27.3 per cent in the first quarter of 2021 compared to the year before.
Manitoba Public Insurance (MPI) says the $89.4-million betterment is primarily a result of interest rates on unpaid claims, and having fewer vehicles on the road due to COVID-19.
“The first quarter of 2021/22 saw a continuation of the favourable claims experience of 2020/21 with the frequency of collisions occurring at a rate approximately 20 per cent lower than generally expected,” said Mark Giesbrecht, MPI’s vice president and chief financial officer in a press release.
Furthermore, MPI is reporting $115.5 million in net income for the first three months of the year after surplus distribution.
That’s up from exactly nil the year before, when MPI says $110.1 million of surplus capital was distributed “as financial relief to policyholders during the COVID-19 pandemic.”
For the first three months of 2021, total revenues earned rose by $3.3 million over the same period last fiscal year, mainly driven by an increase in Special Risk Extension policies, and offset by a decrease in motor vehicle and drivers premiums.
Due to the favourable financial positions, MPI notes it previously applied for a 2.8 per cent rate decrease in basic insurance premiums for the 2022/23 insurance year.
It says roughly 74 per cent of vehicles would see either a reduction or no change.
“Due to the reduction of ongoing claims, the basic compulsory auto product continues to collect more revenue than is required which has led MPI to apply to the Public Utilities Board for a third customer rebate since the onset of the pandemic,” Giesbrecht said.
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