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Is Alberta next for no-fault insurance?


March 10, 2020   by Adam Malik


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Alberta will move to a no-fault system for auto physical damage if the province’s brokers have their way.

That’s just one of 20 legislative and regulatory changes the Insurance Brokers Association of Alberta (IBAA) has recommended to Alberta’s Auto Advisory Committee in a white paper released March 9.

The white paper, The Framework: Fixing the Alberta Auto System, highlighted the increased costs associated with physical damage repair. Because the cost of repair is something beyond the control of the IBAA, the group said it needs to look at areas is can control — one of them being a move to no-fault.

Such a move would eliminate “all the costs associated with recovery and investigation where liability is an issue or the other party is unknown,” IBAA’s white paper says. “The deductible is charged by the primary insurer based on its client’s degree of liability.”

The IBAA’s white paper listed four primary concerns overall with the Alberta auto product. One being that increasing costs will result in a financially inaccessible system if no changes are made. The association wants to see better flexibility so that insurers can offer customers the ability to choose customized protection and options based on their financial situation.

The white paper also highlighted concerns around ensuring those who are injured receive comprehensive medical treatment — instead of just cash — to either recover or have “the best quality of life where recovery is not possible. Consumers deserve more choice in benefit plans, based on social and financial circumstances.”

Other concerns centred around charging drivers a price that equals their risk exposure; and giving consumers the option to choose whether they want to sue for injuries. “Consumers who suffer devastating injury should be safeguarded by retaining the right to sue in prescribed circumstances,” the white paper says.

Solutions to those concerns are listed among the IBAA’s recommendations (10 falling under each of legislative and regulatory). Other recommendations made to reduce costs for policyholders include allowing a deductible to be implemented for fire or theft claims; calling for higher distracted driving penalties that also increase as offences pile up; educating drivers about distracted driving dangers as a way to reduce collisions; educating about the risks of leaving keys in the ignition to reduce theft; and bringing in regulation to expand and standardize rating territories (there are only three in the province: Edmonton, Calgary and the rest of the province) to represent the different exposures faced by those living in metropolitan, urban, rural communities.

“IBAA is making these recommendations because we believe there is tremendous opportunity to reform the Alberta auto product while both providing coverage choice and premium options,” the group wrote in the white paper. “Ultimately, the goal is to preserve stability of automobile insurance for Alberta consumers.”


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8 Comments » for Is Alberta next for no-fault insurance?
  1. Marie says:

    No fault insurance. You got to be kidding. There is enough things that we loose when an accident happens, whether it is auto, house ,or personnel. To have us pay for some one else’s mistake, is not fair. What incentive is this for drivers coming threw the system to really care about their driving habits and responsibility to others on the road if no consequences are applied to the person at fault when accidents happen. Or for any person who abuses the privilege to be able to drive a vehicle. If you are at fault you should pay!!

  2. Cris says:

    I live in Quebec and we have had no-fault insurance since the 70s. Even though it is called no-fault, it does not mean you are not responsible. If you caused accidents or you were reckless, this will go on your driver’s record and believe me your premiums will go up. We even have no-fault for personal injury which means that we cannot sue anyone. The government compensates you based on your injuries, your revenue etc…The result of this is that our car premiums in our province are among the lowest in Canada.

    • Nikki says:

      and what happens if you are not at fault? ive been rear ended twice.
      does the person tht got hit also get an insurance increase? thats what i think is unfair. i worked hard to maintain a good driving record and am not willing to sacrifice my premium if an idiot decides to run into me again.

  3. Brad Ansell says:

    This appears to be a shield for the insurance company to reduce liability they get to Define what coverage will be and not risk being sued not sure how that ends up being impartial, easy to corrupt.

  4. Shawn says:

    Don’t buy into their lies. No fault insurance does not mean savings passed on to the insured- look at the completely broken system in Ontario, Quebec, Saskatchewan and British Columbia.

    All we are seeing here is the big bad insurance companies lobbying the government to legislate their profitability. We know that the most recent report generated for the Government of Alberta by Oliver Wyman shows that over the past 3 years (2016-2019) claim costs in major areas have decreased or remained the same. In fact, bodily injury claim costs have decreased by 2.0% over this period of time.

    Again, they need to stop spreading lies. Educate yourselves. This needs to be the End of Jason Kenny and his UCP socialist regime in Alberta.

  5. Kate How says:

    I agree with Educate ourselves but really a socialist regime you would rather give all of your money to the big insurance companies that have their head offices in the eastern provinces and they are the ones who support the federal government. So guess what it is not the Alberta Socialist government that you have to worry about our money does not stay in Alberta now it all goes east. So why not go with no fault insurance and then maybe we will be able to afford to continue to drive.

  6. Raymond says:

    It would appear the Alberta committee proposing this “No Fault” insurance thinks that New South Wales in Australia is on a par with Alberta. How these so-called experts came up with this a mystery as NSW is 200,000 sq km bigger but also has a bigger population that DO NOT HAVE TO DRIVE IN SNOW AND ICE for 5 months. The saying is “Apples for Apples” Can I also ask what will happen to the funds already held by the Motor Vehicle Accident Claims Fund? Where does OUR money end up and in who’s pockets?

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