Understanding the 2024 Alberta Auto Insurance Reform

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Picture of By <span>Aren Mirzaian</span>
By Aren Mirzaian

Updated on April 4, 2024

Visit author page
Picture of By <span>Aren Mirzaian</span>
By Aren Mirzaian

Updated April 4, 2024

Visit author page

2 minute read

Article Contents

The Alberta government has announced a comprehensive reform of the auto insurance system, set to take effect in 2024. This reform addresses longstanding issues within the industry, offering drivers and insurers a more equitable and financially sustainable framework. This article delves into the specifics of the reform, evaluating its potential impact on Alberta’s drivers.

Quick Facts About the Alberta Auto Insurance Reform

  • Rate Increase Cap: Starting in 2024, insurance rate increases for safe drivers will be capped at the previous year’s inflation rate, starting at 3.7%, making premiums more predictable.
  • Criteria for Good Drivers: Drivers need a clean record to benefit from the cap. It involves not having at-fault accidents in six years and specific limits on traffic convictions. This aims to reward safe driving but has received criticism for being too restrictive.
  • Enhanced Powers for AIRB: The reform grants the Automobile Insurance Rate Board more authority to regulate insurance premiums, including enforcing refunds for excessive profits and conducting rate assessments anytime.
  • Flexible Payment Plans: Insurers must offer payment options that ease the financial strain of lump-sum payments, making it easier for drivers to manage their costs.

Full Overview of the Reform (Infographic)

The infographic below showcases the key changes in Alberta’s auto insurance system.

Overview of the reform: the key changes

To read through the full reform and learn more about how it affects Alberta drivers, view our comprehensive table below or go to the Government of Alberta page.

  • Implementing caps on rate increases for good drivers with commendable records starting January 1, 2024.
  • Caps are tied to the inflation rate of the preceding September, set at 3.7%, below the national average.
  • No at-fault accidents in the past six years.
  • No Criminal Code convictions for traffic-related offences in the past four years.
  • No major traffic convictions within the last three years.
  • A limit of no more than two minor traffic convictions in the past three years.
  • This definition is aimed at rewarding prudent driving but has been criticized for potentially being too restrictive.
  • Proposed amendments to enhance AIRB’s authority over insurance premiums.
  • Empower AIRB to mandate refunds during excessive insurer profits that surpass the AIRB’s benchmarks.
  • Allows AIRB to initiate rate assessments anytime to ensure premiums remain justifiable.
  • These changes aim to increase regulatory oversight and ensure fairness in the insurance sector.
  • Insurance providers are required to offer flexible premium payment options to policyholders.
  • Initially mandated in January 2023, this measure will become a permanent regulation.
  • It addresses the issue of financial strain caused by lump-sum premium payments and aids in financial planning for Albertans.

Key Takeaways from MyChoice

Below are some of the key takeaways from our team in regards to this reform for drivers in Alberta:

Adopt Safe Driving

Small changes in driving behaviour, such as avoiding hard braking and rapid acceleration, can help you qualify as a “good” driver.

Enroll in UBI Programs

Usage-based insurance offers a direct path to savings for safe drivers. It monitors habits like speed and time spent driving, rewarding safer practices with discounts.

Take Defensive Driving Courses

These courses can improve your driving and safety on the road and qualify you for insurance discounts.

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