Alberta proposes opening door to public insurers

New reforms tabled in the Alberta legislature would see public insurers allowed to sell auto insurance in the province. Bill-34, the “Insurance Amendment Act, 2005” was introduced by Peace River MLA Frank Oberle. “We are following through on a commitment made last summer to allow British Columbia’s ICBC [Insurance Corp. of B.C.], Saskatchewan’s SGI Insurance and Manitoba’s Public Insurance (MPI) to enter the province’s competitive insurance market,” says Oberle. “This proposed change also means these companies must follow the same regulations as private insurers.”

Other changes proposed by Oberle include clarifying that the “all comers” rule applies only to private passenger vehicles, and ensuring all insurers belong to the General Insurance OmbudService (GIO). The changes also clarify that insurers are not entitled to any compensation for revenue lost as a result of the government’s rate freeze.

The changes would also give authority to the province’s Superintendent of Insurance to “issue interpretive guidelines to assist with more effective regulation” of insurers.

In related news, the Alberta Auto Insurance Rate Board (AIRB) is recommending the government not mandate rate reductions in light of decreases already filed for voluntarily by insurance companies. Insurers representing about 50% of the private passenger auto market have already filed for reductions of between 4%-7% to take effect between the beginning of April and July of this year. The AIRB says other insurers have expressed their intention to make similar filing reductions.