Saskatchewan Government Insurance (SGI) has submitted a proposal to the Saskatchewan Rate Review Panel (SRRP) for a revenue-neutral rate rebalancing.
The proposed changes would result in no net change overall to the Auto Fund. If approved, rates will be rebalanced to move closer to each vehicle group paying a sufficient amount to cover the cost of insurance claims for that group.
The proposal would result in:
- Rate decreases for about 52 per cent of Saskatchewan vehicles with an average annual reduction of $102;
- Rate increases for about 48 per cent of Saskatchewan vehicles with an average annual increase of $96; and
- No rate change for the remaining vehicles (less than one per cent).
Increases will be capped to reduce rate shock – a maximum of $150 per year for an annual premium under $1,000 and a cap of 15 per cent for premiums over $1,000/year. If approved, the rate changes would take effect Jan. 21, 2022.
The full rate proposal can be viewed on the SRRP’s website at www.saskratereview.ca.
"SGI is confident that the premiums currently being collected are enough to offer all of our customers coverage in the event of a collision; by rebalancing rates so some vehicle types pay more and others pay less, we can move closer towards rate fairness,” said SGI president and CEO Andrew Cartmell.
“SGI is committed to ensuring fairness in rates between vehicle types, while also keeping Saskatchewan’s basic auto insurance rates among the lowest in Canada.”
The Saskatchewan Rate Review Panel will review SGI’s proposal and seek feedback from the public. The SRRP will then submit a report with its recommendations the minister of the Crown Investments Corporation to inform cabinet’s decision.
“In recent years, we have seen expenses for repairing more intricate and complicated car systems increase,” Cartmell said. “Despite that, we have been able to avoid significant increases in premiums due to a reduction in collisions, injuries and fatalities on Saskatchewan roads, thanks in part to stronger traffic laws, increased enforcement and effective awareness campaigns.”
This rate program is about fairness in rates, in contrast to the $285 million in rebates that SGI issued to customers in May, which was done to address excess capital. The rebates were issued because the Rate Stabilization Reserve (RSR) – which protects customers against sudden rate fluctuations due to unexpected cost pressures – had an excess of funds due to higher-than-anticipated investment returns and a lower-than-expected number of collision claims during the pandemic.
“Decisions on rates are made based on longer term trends, while the excess in the RSR resulted from conditions that cannot be expected to be repeated every year.” said SGI chief financial officer Jeff Stepan. “Rebates were the best way to return that one-time windfall to SGI customers.”
The Auto Fund is self-sustaining, and does not pay dividends to, nor receive money from, the government.
Proposed rates for all vehicles can be found on SGI’s website at https://www.sgi.sk.ca/2021-rates.
Comments on the rate proposal can be provided to the SRRP in a variety of ways:
- Via the SRRP website
- The SRRP Facebook page
- The SRRP Twitter account,
- Calling toll free 1-877-368-7075,
- Emailing feedback@saskratereview.ca, or
- At one of series of public hearings
