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Saskatchewan drivers will be getting a cheque from SGI this spring.
The Crown insurance company is passing on roughly $350 million in earnings through a one-time rebate. A total of $285 million will go back to drivers directly.
“The Saskatchewan Auto Fund Rate Stabilization Reserve is in a very strong financial position due to very strong investment returns and — to a smaller degree — fewer collision claims due to the COVID-19 pandemic,” Minister Responsible for SGI Don Morgan said in a release.
“As a result, SGI will pass on these earnings to the people of Saskatchewan by issuing rebates to all registered vehicle owners and by improving injury benefits.”
The rebate will vary for each customer, but it works out to an average of $285 per vehicle or 26 per cent of an average annual premium.
SGI president Andrew Cartmell says there was a steep decrease in claim activity compared to past years.
“We had about $100 million less in claims activity last year. A lot of it is due to COVID,” Cartmell said. “We also had a lighter-than-normal storm season, so we didn’t pay out as much in hail claims.
“(Of) the $285-million rebate, about $100 million is likely due to claims activity and the rest is due to the investment portfolio performing very well.”
A customer’s driving history or driving record will not matter when it comes to getting a rebate. All vehicles that have been registered in the province throughout the last three years are eligible as well.
“If you only registered your vehicle a few months ago, it’s going to be small amount, but yes, you’ll you will get some money,” Cartmell said.
The last time SGI issued a rebate in the province was in 2007.
The Auto Fund, which all Saskatchewan vehicle owners pay into via their insurance premiums, maintains the Crown’s stabilization fund. It protects customers against sudden rate fluctuations due to unexpected cost pressures.
The stabilization fund also relies on investment earnings. SGI said the fund experienced strong returns over the past fiscal year.
SGI is also enhancing injury benefits for people involved in vehicle collisions.
Customers who require assistance with daily tasks (i.e., dressing, bathing, cooking, cleaning and yard care) will see the maximum payments for those services increase to better reflect current market rates. This is expected to benefit more than 1,100 SGI customers.
Customers who receive income replacement benefits from SGI and Canada Pension Plan (CPP) will no longer have income benefits from SGI reduced by their CPP payment. It is standard industry practice to reduce insurance benefits by the CPP payment. SGI is leading the industry by eliminating this practice, to the added benefit of our most seriously injured customers. It is estimated that this will benefit approximately 200 people.
Rebate cheques will be issued in May and sent through the mail.
NDP responds to rebates
Aleana Young, the NDP’s critic for SGI, said the news of the rebate was welcome news for the people of Saskatchewan.
However, Young called the move a “cynical U-turn” by the Saskatchewan Party, which she said referred to the NDP’s campaign pledge as a “vote-buying scheme.”
“In the lead up to the last election campaign, the then-Minister Responsible for SGI Joe Hargrave responded to Saskatchewan NDP Leader Ryan’s Meili’s SGI rebate pledge by saying that it would drive up the provincial debt,” Young wrote. “Hargrave said at the time: ‘It’s unfortunate that the NDP plan to use SGI as sort of a slush fund.’
“While it’s positive for Saskatchewan families that the government has reversed course and will be issuing rebate cheques, we are calling on the government to work with SGI to reduce rates in a sustainable manner to make insurance more accessible in the long term for Saskatchewan families and businesses.”
