Manitoba Public Insurance has a three week hearing with the Public Utilities Board regarding its application for a 2.2 per cent rate hike.
MPI said it needs the increase to help beef up it’s reserve fund.
If approved, insurance rates would go up by about $27 for the average driver.
Byron Williams from the Public Interest Law Center, which represents the Consumer’s Association of Canada, believes the increase is unjustified.
“From our clients’ perspective, this is padding that MPI doesn’t need to break even this year.”
He adds, “they’re seeking what amounts to about a $20-million rate increase from ratepayers, not to break even, but, in our view, to create an extra reserve cushion over and above the $250-million it’s already projected to have.”
A decision by the Public Utilities Board is expected by December.
MPI’s net income for the first six months of its fiscal year was $30.5 million higher than the same period last year, according to it’s second quarter financial results.
That six month period ran from March until August.
MPI says the total net for the first six months of the fiscal year was $72.8 million.
The corporation pointed out that was with a major hail event in June.
They also note that claims tend to be much higher over the winter than the summer months.
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