June 17, 2003

SGI TIGHTENS REGISTRATION PROCEDURES AND INSURANCE COVERAGES FOR IRP CARRIERS

Over the next few months, SGI is taking a series of actions to tighten up its registration procedures and insurance coverages for International Registration Plan (IRP) carriers who travel across North America.

The changes include more on-site audits, a more thorough application process, discontinuing the sale of excess damage coverage over $15,000 and charging an additional premium to carriers who have less than three years experience registering in Saskatchewan on or after Aug. 1, 2003.

Taking advantage of Saskatchewan’s low premiums, a few out-of-province carriers, most with poor safety records, were falsely claiming to be based in the province. The premiums collected from these IRP carriers were insufficient to cover their losses. At the end of 2002, for every dollar collected in excess coverage premium, SGI paid out $1.72 in losses.

To prevent Saskatchewan from becoming a haven for illegally registered carriers, these changes had to be made.

"To be proactive and keep our rates low, we had to revise the registration procedures and the insurance coverages we sell to IRP carriers before it became a problem," said Crown Investments Corporation Minister Maynard Sonntag. "This is a result of Saskatchewan having among the lowest insurance rates in the country."

The IRP is a method of registering fleets of vehicles that travel in two or more member jurisdictions. These changes bring Saskatchewan’s IRP procedures in line with most other jurisdictions in North America.

Jim Friesen, General Manager of the Saskatchewan Trucking Association, is in support of the proposed changes.

"We are supportive of any proactive measures that keep the rates low for Saskatchewan carriers," said Friesen. "I think these changes are a step in the right direction."

Even with the inexperienced carrier surcharge, the rates for IRP vehicles continue to be much lower in Saskatchewan compared to other jurisdictions in Canada. Both the increased premiums for inexperienced carriers and the removal of the excess value coverage on renewal come into effect Aug. 1st.

Taken together, SGI is optimistic these changes protect Saskatchewan truckers from cross-subsidizing the rates of out of province carriers falsely registering in Saskatchewan. SGI will continue to carefully monitor the situation and take additional actions if necessary.

Saskatchewan offers among the lowest auto insurance rates in the country and SGI is dedicated to keep that tradition alive.

For more information:
Julianne Jack
SGI Communications
775-6907