August 30, 2009

SGI's Change on Auto Insurance

By now, SGI is waiting for approval from the Saskatchewan Rate Review Panel (SRRP) on its auto rate increase proposal. The proposed rate increases, if approved, would go into effect Nov 1, 2009. The overall 4.2 per cent rate increase would be the first auto fund increase since 2000.

Saskatchewan Government Insurance (SGI) is the province’s self-sustaining auto insurance fund. SGI operates 21 claims centres and five salvage centres across Saskatchewan and a head office in Regina. The organization employs over 1,800 people and works with a network of almost 300 independent insurance brokers and 420 motor licence issuers across the province.

In 2004, SGI used to proposed such a proposal and canceled it later due to financial information provided by SGI’s external Actuary at the time that forecasted an improved financial position for the Auto Fund. However, it is not going to happen again. SGI says that increase is necessary because increases in claims and expenses have outpaced revenue increases received by the Saskatchewan Auto Fund.

If approved, this proposal would result in 553,000 Saskatchewan vehicle owners (55 per cent) seeing their rates increase less than $5 per month, on average $55 annually. It would also result in 321,000 vehicle owners (32 per cent) seeing no change to their rates, and 126,000 vehicle owners (13 per cent) receiving an average rate decrease of $21 annually.

Rates are determined based on the actual risk each vehicle make, model and year represents for being involved in a claim and the actual costs of paying that claim. Some examples of vehicle rates, before safe driving discounts, include:

Vehicle Current Rate; Nov. 1, 2009 Rate Rate Change
2007 Toyota Camry $1,049 $1,049 $0
2005 Dodge Grand Caravan $1,050 $1,050 $0
2002 Honda Civic 2 Door $933 $1,049 $116
2002 Ford Ranger Regular Cab $768 $746 ($22)
2001 Chevrolet S10 Pickup $725 $755 $30
1997 Ford F150 Regular Cab $761 $761 $0
1991 Chevrolet Cavalier $567 $578 $11

The application includes a maximum increase of 12.5 per cent for light passenger vehicles to a limit of $125 (average increase $64 annually) and maximum increases of 10 per cent for other vehicle classes, with the exception of:

· up to 25 per cent (average increase $230 annually) for sport motorcycles;
· up to 15 per cent for other motorcycles (average increases of $23 and $110 for dual purpose/other and cruiser/touring motorcycles respectively);
· up to 22.5 per cent (average increase $186 annually) for light commercial trucks that travel out of province;
· up to 17.5 per cent (average increase $89 annually) for taxis in rural areas; and
· up to 17.5 per cent (average $129 annually) for U-drive rental vehicles.

SGI will continue to offer safe driving discounts in 2009. Auto Fund customers received roughly $80 million in safe driving discounts through the Safe Driver Recognition and Business Recognition programs in 2008.

This is how the proposal looks like.
You can get a quote by try this vehicle registration and insurance rate calculator.

Here are new rates for all kinds of vehicles.
Vehicles for business use:

Vehicles for farm use:

Vehicles for personal use:

Source from SGI

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