July 19, 2016 by Canadian Underwriter
Manitoba Public Insurance Corp., the crown corporation that writes auto insurance in the province, reported Friday its underwriting loss was $33.8 million during the three months ending May 31.
MPI had reported underwriting income of $40.73 million in the three months ending May 31, 2015, the carrier’s fiscal first quarter.
MPI’s products include Basic Autopac, which is mandatory in Manitoba. Basic Autopac includes $200,000 in third-party liability, all perils coverage (including collision and upset, vandalism, theft, flood, hail, storms, fire and explosions) for most vehicles, as well as the personal injury protection plan, which “covers medical, personal and travel expenses related to the injury resulting from the accident.”
Optional additional coverages include additional liability and extension loss of use, among others.
MPI reported total claims costs of $263 million in the three months ending May 31, compared to $177.7 million during the same period of 2015.
“Claims costs for the three months ended May 31, 2016 increased by $85.4 million or 48.1% compared to last year due primarily to an increase of $58.2 million or 274.5% in bodily injury claims incurred and an increase of $25.4 million or 21.1% in physical damage claims incurred,” MPI said in its financial report. “The $58.2 million increase in bodily injury claims was impacted by an increase of $69.0 million due to the interest rate adjustment on unpaid claims. Collision claims increased by 1,380 claims compared to last year, representing an increase of $15.3 million in collision claims incurred. This increase contributed significantly to the physical damage claims incurred.”
Net premiums earned were $274.9 million in Q1 2016, up 5.4% from $260.8 million during the same period in 2015.
MPI reported total earned revenue of $289.8 million during the most recent quarter, up 4.9% from $275.6 million in Q1 2015.
Net claims incurred were $225.1 million in Q1 2016, up 59% from $141.5 million in Q1 2015.
Expenses increased 6.1%, from $57.2 million in Q1 2015 to $60.7 million in Q1 2016.
MPI reported investment income of $37.6 million in the latest quarter, compared to an investment loss of
$17.7 million in Q1 2015. MPI reported an unrealized gain on fair value through profit and loss (FVTPL) bonds of $12.835 million in Q1 2016, compared to an unrealized loss on FVTPL bonds of $50.31 million during the same period in 2015.
Net income from operations was $3.7 million in Q1 2016, down 84% from $23 million during the same period in 2015.