SGI CANADA experiences record year, Auto Fund faces challenges
April 15, 2013
2012 was an extremely successful year for SGI CANADA, with record underwriting profits outside Saskatchewan enabling the corporation to pay an unprecedented dividend to the province.
Though the Saskatchewan Auto Fund's financial results improved significantly from 2011, the Rate Stabilization Reserve was still drawn down in 2012.
SGI released its financial and operational highlights today when the 2012 annual reports for both SGI CANADA and the Saskatchewan Auto Fund were tabled in the Legislative Assembly.
SGI CANADA is the competitive arm of SGI, selling property and casualty insurance in seven provinces. The Saskatchewan Auto Fund is the self-sustaining, compulsory auto insurance plan administered by SGI on behalf of the province. It is a public fund for motorists, cannot pay dividends and is not intended to earn profits.
SGI CANADA posted a consolidated profit of $82.1 million, with a record $18.7 million coming from operations outside Saskatchewan. SGI CANADA and its subsidiaries were profitable in every jurisdiction in 2012.
“This is a real accomplishment for SGI CANADA, especially since the company achieved this success while operating in a highly competitive marketplace,” said Minister Responsible for SGI Donna Harpauer.
Strong underwriting results, combined with improved investment income, contributed to the successful results. SGI CANADA's underwriting profit of $55.6 million is the highest in the corporation's history, resulting in a record dividend of $52 million to its shareholder.
While SGI CANADA experienced normal summer storm activity, the Saskatchewan Auto Fund felt the impact of high claim costs in the fourth quarter of 2012 due to poor winter driving conditions. This contributed to the Auto Fund drawing down the Rate Stabilization Reserve (RSR) by $11.5 million.
The RSR balance of $127.1 million at the end of 2012 puts it below its target range for capital adequacy. SGI currently has a proposal before the Saskatchewan Rate Review Panel that includes a surcharge to help replenish the RSR.
2012 proved to be a good year for customers with safe driving records, with SGI providing $108.8 million in discounts through the Safe Driver Recognition and Business Recognition programs. SGI also promoted safe driving through its traffic safety efforts.
“SGI partners with law enforcement across the province to promote monthly traffic safety blitzes targeting distracted driving, impaired driving, seatbelt use and other key road safety issues,” said Harpauer. “The SGI Safe Ride app makes it easy for Saskatchewan motorists to plan a safe ride home by keeping track of taxi and designated driving services, bus routes and even a personal list of designated drivers.”
Saskatchewan Government Insurance (SGI) is the province's self-sustaining auto insurance fund. SGI operates 21 claims centres and five salvage centres across Saskatchewan with a head office in Regina. SGI also works with a network of over 400 motor licence issuers across the province. Customers can now do some transactions online. Look for the MySGI link under Online Services on your motor licence issuer's website or SGI's website.