Automobile insurance reform

Reforming Alberta’s auto insurance system so it is more affordable and stable for drivers and insurers now and in the future.


The increasing cost of repairs, parts shortages and rising auto thefts are all driving up insurance rates across Canada. But the single biggest reason for the increase in Alberta is the increasing costs of personal injury claims.

Alberta’s government asked independent experts to look at systems that could reduce the costs of auto insurance and improve the sustainability and stability of the insurance industry.

Oliver Wyman focused its work on comparing average premiums under different existing auto insurance systems, largely across Canada. The Nous Group examined the broader costs and benefits of these different auto insurance models. No decisions have been made on the changes that will be made to Alberta’s auto insurance system. These reports will be used to inform future engagements and policies.

Read the report: Auto Insurance Changes in Alberta (includes the Oliver Wyman and Nous Group studies)

Previous updates

  • Rate increase cap

    In 2024, Albertans with good driving records will only see their rates increase to account for Alberta’s inflation, using the September 2023 inflation rate.

    In September, Alberta’s inflation rate decreased to 3.7% which was below the national average. On a monthly basis, Alberta also saw one of the largest inflation decreases among provinces.

    A driver with a good record is everyone except those who have any of the following:

    • any at-fault accidents in the last 6 years
    • any criminal code traffic convictions in the last 4 years
    • any major traffic convictions in the last 3 years
    • more than one minor traffic conviction in the last 3 years
  • Automobile Insurance Rate Board

    Reduced driving patterns during the pandemic caused insurers to unexpectedly experience high profits, exceeding the benchmark set by the Automobile Insurance Rate Board. Proposed amendments to regulations would grant the board more authority to regulate Alberta’s auto insurance industry and keep rates fair.

    If amended, the Automobile Insurance Rate Board would have the authority to direct insurers to return premiums to drivers during exceptionally profitable years. The board would also be able to request a rate filing from an insurer at any time, allowing the board to review and possibly lower rates if necessary.

    The Automobile Insurance Rate Board will also carefully monitor rate increases in 2024 to ensure that they are reasonable and justifiable.

  • Premium payment plans

    In January 2023, the Superintendent of Insurance required insurers to provide premium payment plan options to most Albertans.

    This measure is to be permanently adopted into regulation so Albertans would not have to fully pay their insurance premiums upfront for the entire year.

    This will give Albertans the opportunity to budget for and manage their insurance costs over time.

Get the best rate

There are steps you can take to make sure you get the best auto insurance rates.

Alberta’s Automobile Insurance Rate Board also has more information on getting the best auto insurance rates: 10 ways to reduce your rates

  • Shop around

    Take advantage of Alberta’s competitive auto insurance market by shopping around. Discover potential savings as different insurers may offer varying rates and coverage options. Comparing multiple rates can help you find a better deal that suits your needs and budget.

    Learn more about shopping the insurance market

  • Explore your options

    With over 60 private insurance companies offering coverage in Alberta, make informed purchasing decisions by exploring the various types of auto insurance and things to consider before choosing a coverage.

    Learn more about purchasing insurance

  • Understand your rates

    Take an active role in understanding how your auto insurance rate is calculated. By understanding how your rate is calculated, you can make choices that help in lowering your rate.

    Learn more about your insurance rates

  • Usage Based Insurance (UBI)

    Consider exploring Usage Based Insurance, also known as 'pay-how-you-drive' or 'pay-as-you-drive'. Through this type of insurance, you may be eligible for discounted rates or rewards based on your driving habits.

    Learn more about UBI

Previous reforms

  • Rate increase pause

    Effective January 26, 2023, Alberta’s government implemented a rate increase pause on private passenger vehicle insurance until the end of the year. Some drivers may still have seen rate increases on their renewals in 2023 due to:

    • previously approved rate changes
    • changes in driving records, such as at-fault claims or traffic tickets
    • adjustments to insurance profiles, such as a change of address or a different vehicle
  • Premium payment plans

    Insurance companies are now required to offer most Albertans the choice to pay their premiums through payment plans rather than annually.

    Read more on the Superintendent of Insurance Interpretation Bulletin

  • Legislation changes

    Bill 41: the Insurance (Enhancing Driver Affordability and Care) Amendment Act, 2020 received royal assent on December 9, 2020 to update the Insurance Act. The following changes came into effect in stages in early 2022:

    • limit the number of experts involved in traffic injury lawsuits to save money and speed up resolution
    • make the pre-judgement interest rate on pain and suffering damages a floating rate that begins to accumulate when written notice of an injury claim is given to an insurer or when a Statement of Claim is served
    • enable direct compensation for property damage to:
      • allow not-at-fault drivers to call their own insurer to cover car repairs
      • eliminate red tape between insurers and reduce costs incurred for pursuing damages from third-parties

    Associated regulation updates came into effect November 1, 2020 for most changes, and January 1, 2021 for the remainder.

    Making rates more affordable

    Measures to address affordability by containing cost-pressures associated with bodily injury claims:

    • revised definition of “minor injury” to include more injuries that do not have a permanent negative or life-altering impact for injured individuals
    • improved injury dispute resolution processes
      • for example, designating dentists as certified examiners to improve the evaluation of jaw-related injuries and help resolve disputes.

    Improving care

    Measures to improve care for Albertans by increasing coverage for diagnostic and treatment services and enhancing benefits included in mandatory auto insurance:

    • designated more types of health professionals as able to deal with traffic injuries, on referral by a primary care practitioner, such as psychologists, dentists and occupational therapists
    • included inflation-adjusted funeral benefits, grief counselling benefits and income replacement benefits
    • enhanced the patient referral process and better defines a “treatment visit”
    • improved clarity on coverage for medical equipment, home modifications and vehicle modifications

    Providing more choice for drivers

    Measures to support insurers in providing more choice in insurance products:

    • enabled innovative insurance options such as pay-per-kilometre
    • allowed insurers greater flexibility in applying Usage Based Insurance (UBI)
      • for example, insurers would be able to use UBI to set overall premiums in addition to current discounting purposes
  • Automobile Insurance Rate Board changes

    The role authority of the Automobile Insurance Rate Board was expanded to provide full authority over elements such as insurer rating factors and rating programs, helping it to respond better to consumer and industry needs, modernize Alberta’s system for setting insurance premiums and the authority to establish guidelines and rules followed by industry.

  • Direct compensation for property damage

    Direct compensation for property damage (DCPD) was enabled by legislation changes and took effect in Alberta on January 1, 2022, giving drivers more consistent treatment and faster response on collision claims.

    With DCPD, drivers deal with their own insurers to cover vehicle repair costs if they are not at fault in collisions. DCPD eliminates red tape between insurers and reduces costs associated with recovering damages from third parties.

    Learn more about DCPD: