The Alberta government is making changes to auto insurance, including rate hikes and switching to a predominantly no-fault claims model.
Premier Danielle Smith announced the change to a “care-focused” system at a news conference in the legislature on Thursday.
Under the new system, car crash victims in most cases won’t be able to sue the party responsible for their injury and, instead, insurers would pay compensation at rates set by the government.
The province said it commissioned two auto insurance reports, which showed that legal fees and legal costs tied to the current system significantly increase premiums. The province added collision-related lawsuits have nearly doubled in Alberta between 2018 and 2022.
By cutting down litigation costs, the government estimates that when the new system is in place in January 2027, it could lead to savings of up to $400 per year for the average insurance premium.
Get daily National news
Get the day’s top news, political, economic, and current affairs headlines, delivered to your inbox once a day.
It’s also promising better support and benefits for those hurt in collisions, such as Albertans who suffer catastrophic injuries receiving treatment and care for the rest of their lives.
Until the new model kicks in, insurers would be allowed to raise rates for good drivers up to 7.5 per cent each year, starting in January.
— More to come…
With files from Karen Bartko, Global News
© 2024 The Canadian Press