Licensed and registered Manitoba vehicle owners are automatically included in the Basic automobile insurance coverage offered by MPI. Basic insurance customers receive up to $50,000 of all-perils coverage for accidental damage of most registered vehicles, up to $200,000 of third party liability coverage for claims made against them and Personal Injury Protection Plan (PIPP) coverage for injury or death caused by an automobile.
Although MPI offers other insurance products to its customers, the PUB is solely responsible for the Basic insurance offered by MPI. The coverage for all Manitobans remains the same under Basic insurance. However, the premiums paid by customers vary based on four factors.
• Where you live
—MPI divides the province into four territories. The risk of claim by customers is in part determined by which of these four territories a customer lives in
• How you use your vehicle—How a customer uses their vehicle and what they use it for directly affects the likelihood of a claim, which in turn affects the premium. For example, if a customer only uses their vehicle to go to work and back within city limits, they are less likely to make a claim than an individual who uses their vehicle as a regular courier
• Your vehicle—The make, model and safety features of a vehicle directly affect the likelihood of a claim, as determined by MPI. A vehicle’s claim risk depends on how well it protects occupants, resists theft and withstands collisions
• Your driving record—The best way to save money on premiums is to maintain a good driving record, which involves actively avoiding traffic violations, at-fault claims, or alcohol or drug-related suspensions. The premiums directly reflect a customer’s place on the Driver Safety Rating (DSR) scale, which monitors driver safety
These factors are integral to the Corporation’s risk calculation—namely, the likelihood that a customer will get into an accident requiring pay-outs that far exceed the aggregated premiums they pay to MPI. The more likely an accident, the more the customer will pay in insurance premiums. The PUB takes these risk calculations, made on the basis of actuarial accounting, as well as the revenue requirements of MPI, into account when faced with annual rate applications from the Corporation.
The deductible is the cost of an insurance claim for which the customer, in this case the driver, is responsible. The deductible for Basic insurance coverage for most cars, SUVs, light trucks and motorcycles is $500. For other types of vehicles, the Basic deductible may be different. A customer’s deductible applies to collision, hail, theft and most other claims. The responsibility of a claimant determines whether they must pay a deductible, or what portion of the deductible they are obligated to pay.
For example, if another driver insured through MPI is at fault for damaging the claimant’s car in a collision, the Corporation reimburses the claimant’s deductible based on the other driver’s fault. So, if the other driver was 100 percent at fault, the claimant gets all of their deductible back. If each driver was 50 percent at fault, the claimant gets half their deductible back.
Basic all-perils coverage included in MPI Basic insurance insures vehicles against accidental loss or damage in Canada and the United States. Customers pay the deductible and any depreciation in the overall value of the vehicle—but their insurance coverage pays the rest, up to the maximum insurable value of $50,000. Basic all-perils coverage includes collision and upset, as well as vandalism, theft, flooding, hail storms, fire and explosions. MPI customers are covered for loss or damage to their vehicles based on the actual cash value of the vehicle before it was damaged.
Basic third party liability
Basic third party liability insures MPI customers against claims others make against them for up to $200,000. Customers are insured if their vehicle damages another vehicle or other property in Manitoba or injures a person or damages another vehicle or other property outside Manitoba but within Canada and the United States. They can be held legally responsible for damage or injuries others claim against them even if they weren’t driving the vehicle at the time.
All vehicle owners are covered by Basic third party liability insurance when driving their own vehicle or when someone else drives their vehicle with their permission. When driving someone else’s vehicle, an MPI customer is covered so long as they are driving with the permission of the vehicle owner. In all cases, coverage is dependent on the driver possessing a valid driver’s license.
Personal Injury Protection Plan (PIPP)
The Personal Injury Protection Plan (PIPP) offered as part of Basic insurance, provides accident benefit coverage to all Manitobans, whether they are all drivers or not, for specific costs they may have from injuries or death caused by an automobile, no matter who is at fault or whether the accident occurred in Canada or the United States. The PIPP is among MPI’s largest expenses and it receives significant scrutiny and attention from the PUB. The PIPP is based on four principles, according to MPI.
First, coverage is meant to extend to all Manitoba residents injured in automobile accidents anywhere in Canada or the United States. Second, compensation must focus on specific economic losses associated with an accidental auto injury or death. Third, compensation must be guaranteed for all injured Manitobans, regardless of whether the accident in question was the fault of the Manitoba resident. Fourth, benefits must be indexed to the Consumer Price Index in order to reflect changing economic conditions over time.
A primary component of the PIPP is the Income Replacement Indemnity, which replaces the income of injured persons who cannot continue employment due to their injuries. Not all injured persons are eligible, and not all injured persons are eligible for the same level of benefits, but Income Replacement Indemnity is an important and costly aspect of the PIPP.