MPI ordered to increase rebate to 45% of 2009-10 vehicle premiums

Manitoba’s Public Utilities Board (PUB) has ordered Manitoba Public Insurance (MPI) to increase its rebate to 45% of the 2009-10 vehicle premiums to policyholders. The ruling means the average Manitoba ratepayer will receive a rebate of $450, representing $320 million of total returns. On March 30, the PUB held a hearing to review MPI’s rebate amount. According to the Winnipeg Sun, MPI’s reserve for its personal injury protection plan (PIPP) had more than $400 million, close to $250 million more than necessary (a reserve of $95 million to $154 million is considered to be a reasonable range, according to The Sun). The excess reserves were accumulated as part of the Personal Injury Protection Plan (PIPP), a plan introduced in 1994 to pay for long-term injury claims, an MPI release says. Dan Guimond, MPI’s vice president of strategy and innovation, told The Sun that when the PIPP was introduced in 1994 to pay out long-term historical injury claims, there were no historical data upon which to base the reserves. “MPI hired actuaries to review the figures every year to see whether enough historical data on PIPP had built up to be comfortable working on that instead of the assumptions,” The Sun reported. “That point came this year, and that’s what triggered the rebate.””The unprecedented $320 million rebate is the result of the annual actuarial review of the corporation’s claims reserves by Ernst & Young,” the MPI release says. “Manitoba Public Insurance provided the current year’s actuarial report to the PUB, which was used to determine the rebate amount.”