SASKATOON - SGI Canada is reporting solid financial numbers in its annual report, but has not escaped economic pressures over the past year.
In their annual report released Monday, they reported net income of $43.2 million and a dividend return of $18.0 million to the province.
Minister responsible for SGI Jeremy Harrison states in a news release that this was despite facing “economic pressures, caused by rising claim costs, inflation, higher vehicle repair costs and extreme weather.”
They also pointed to the Saskatchewan Auto Fund which saw $1.170 billion in total net claims incurred,,$1.127 billion in gross premium written, $181.1 million in discounts to customers through Safe Driver Recognition and Business Recognition programs and $257.7 million in investment earnings. There is also $726.9 million in the Rate Stabilization Reserve after a reduction of $198 million.
But there are pressures being seen by the Auto Fund as Harrison acknowledged at Monday’s news conference in Saskatoon on the annual report release.
“We are committed to maintaining the sustainability of the Auto Fund,” said Harrison. “And we are in a sustainable position right now, but we're going to keep a very close eye on where the trends are going, because we are seeing very significant pressures on the auto fund on cost per repair, for instance.”
Harrison pointed to changes in the way auto repairs are done. He noted that 20 years ago, if somebody were to back into a pole and the bumper was dented, “you'd take it to an auto body shop, they'd pound out the dent, and away you go.”
“Now, if you back into a pole with a new vehicle, which have sensors and cameras and all, you have to replace the entire bumper. So you're talking a $4,000 or $5,000 repair bill. So this has meant that cost per incident per repair has significantly impacted SGI and the Auto Fund, which is not a for profit.
Harrison said the Auto Fund is “based on a long-term balance of rates paying for claims. So we are going to keep a very close eye on that.”
As for potential increases impacting consumers, Harrison added no decisions have been made yet. But he pointed to Manitoba Public Insurance having come back with a rate increase of nearly six per cent starting April 1 of this year.
“So we're going to be making these decisions in the coming months that haven't been made yet, but there are pressures that are going to come up. “
