The Automobile Insurance Rate Board has released an independent report prepared by Oliver Wyman Limited examining projected claim costs under Alberta’s care-first auto insurance system. Rising legal costs, inflation, vehicle theft, weather-related losses and tariffs are driving premiums higher. The report shows that moving away from a court-based insurance system will reduce overall costs and improve stability for consumers.
For Albertans with basic coverage, average savings are expected to reach up to $366 per vehicle, per year under the new-care first system. Care-first changes how support is delivered after a collision. Instead of going through lengthy legal processes to access compensation, injured Albertans will receive immediate access to medical care, rehabilitation and income support. Treatment and benefits will be based on what people need to recover, giving Albertans greater certainty and confidence when they need it most.
Premiums under the care-first system will be determined by individual risk factors rather than market pressures. This means good drivers will pay less and bad drivers will pay more.
“Our goal is to build a stronger auto insurance system that better protects Albertans and their wallets. This independent report shows that care-first auto insurance will deliver better injury benefits, meaningful savings, and greater stability for drivers over the long-term.”
The report highlights the impact of Alberta’s Good Driver Rate Cap, which protects good drivers from significant premium increases. Without the rate cap, the average cost of full auto insurance coverage could have exceeded $3,100 by Jan. 1, 2027. When care-first is implemented in 2027, the average cost of auto insurance is expected to be around $2,000 per policy.
"Insurance is essential to protecting Albertans when the worst happens. While there are many factors that contribute to individual auto insurance premiums, we believe care-first will support improving overall affordability for Albertans through a more sustainable regulatory environment, and AMA supports this. Care-first also expands benefits for injured Albertans, which should result in better health recovery outcomes for Albertans who need it."
This new, made-in-Alberta care-first system is expected to launch Jan. 1, 2027.
Quick facts
- The Automobile Insurance Rate Board is an independent agency established under the Insurance Act to regulate auto insurance company rating programs and educate Albertans about auto insurance.