Crash-riddled winter could raise Manitoba auto insurance rates

Manitobans may want to brace for higher auto insurance rates, thanks to an unusually brutalwinter,but opposition politicians are questioning Manitoba Public Insurance's possible plans.

MPI would not say what, if any, rate increase motorists should expect this year, but the provincial government has beenhintingat the possibility of higher rates due to prolonged, harsh winter conditions.

"I don't know of a single Manitoban who doesn't appreciate the challenges of this past winter," Andrew Swan, the minister responsible for MPI, said during question period on Monday.

Bone-chilling temperatures,piles of snow and ice-slicked road rutswreaked havoc on roadsthis past winter, resulting in a total of 56,000 collision claims with MPI from December to February an increase of 6,000 from the previous winter and almost $1 billion paid out to cover those claims.

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"It was a very challenging year for Manitoba Public Insurance," saidMPIspokesperson Brian Smiley.

"We saw a record winter for collision claims, we saw an increase in collision claims overall, we saw an increase in claims costs, we saw an increase in the severity of costs."

But Byron Williams, a consumer-rights lawyer with the Public Interest Law Centre, says one bad winter should not drive up auto insurance rates.

"There's lots of people struggling, and this will only exacerbate it," he said.

MPI officials will submit a rate proposal to the Public Utilities Board next month.

Payments to former CEO add to controversy

The controversy over a possible rate increase heated up in the Manitoba Legislature on Monday with the opposition Progressive Conservatives revealing that Marilyn McLaren, MPI's former chief executive officer, had received a retirement packagetotalling just over $488,000.

As well,the Crown corporation has signed a one-year contract with McLarento provide "advice, guidance and information with respect to the executive operations of Manitoba Public Insurance," according to an agreement for services documentobtained by the PCs under aFreedom of Information and Protection of Privacy Act(FIPPA) request.

As part of theagreement, MPI agrees to pay McLaren $3,900 a month for "21.75 hours of services (three days or six half-days such as the parties may agree),"according to the contract.

She can additionally invoice MPI at a rate of $180 an hour for any services carried out beyondthe 21.75 hours.

• Manitoba gives OK to retiredMPIboss to sign new contract

Provincial conflict-of-interest rules say a senior public servant must wait at least a year before working for a government or Crown agency, but the NDP government approved an order-in-council in March to allow McLaren's contract to go ahead.

One of McLaren's jobs has been to apply to the Public Utilities Board for a rate change, said PC Leader Brian Pallister.

"To send someone who is being paid a considerable amount of money on top of the money that they were paid when they were in the job, plus the severance on top of it, is kind of adding insult to injury, I think,for Manitobans," he told reporters.

But Swan stood by MPI'smove, insisting that "Manitobans will continue to have lower premiums than any other province in Canada."