Alberta’s government is proposing changes that will contain costs and stabilize premiums in the auto insurance system, while increasing medical benefits to support Albertans injured in collisions. Other changes include cutting red tape and bringing efficiencies to the system to give Alberta drivers more options and flexibility.

“Both drivers and insurers have been paying the consequences of the previous government’s ill-thought-out rate cap that left many Alberta drivers without reasonable insurance options. These actions will start to ease cost pressures and stabilize premiums for Alberta drivers.”

Travis Toews, President of Treasury Board and Minister of Finance

In addition, Alberta’s government will consider recommendations of the Automobile Insurance Advisory Committee, which was tasked with reviewing Alberta’s auto insurance system, to support system-wide transformation. The recommendations will serve as a basis for further engagement with Albertans and stakeholders on larger reforms.

New measures will:

  • Increase insurance affordability by controlling key cost pressures, including capturing more minor injuries under the compensation cap for pain and suffering damages, and using a floating rate for interest accumulated on pain and suffering damages.
  • Increase medical benefits to support Albertans injured in traffic accidents with access to more health professionals (e.g., dentists, psychologists and occupational therapists) and inflation-adjusted benefits (e.g., income replacement) to deal with the after-effects of collisions, and improved clarity on patient referral and treatment processes and coverage for medical equipment.
  • Create more consumer choice by enabling insurance companies to offer more insurance options such as pay-per-kilometre, and greater flexibility with usage-based insurance to give Alberta drivers more choice and control over their own costs.
  • Modernize and improve Alberta’s insurance system by cutting red tape in the auto insurance system and allowing direct compensation for property damage to allow not-at-fault drivers to work directly with their own insurers for vehicle repairs after collisions. 

Quick facts

  • The cost of auto insurance for Alberta drivers is third highest in Canada.
  • Albertans should expect to see a break from steep increases to their premiums, or any potential savings in the coming months.
  • Further engagement on the future of Alberta’s auto insurance system will be rolled out over the coming fall and winter months.
  • Some Alberta drivers were negatively affected throughout the rate cap, resulting in: having to pay for the full year’s premium up-front rather than monthly; being denied collision and comprehensive coverage; and not being able to access coverage through their broker.
  • The rate cap was not for individual drivers. It was a cap on insurers’ Alberta-wide income from auto insurance premiums (i.e. rates could be raised on some drivers, if compensated elsewhere). Many still saw rate increases greater than five per cent.