While insurer Pembridge is not withdrawing from the Alberta auto market, the company is scaling back and restructuring its business there. A statement released this week says the insurer undertook a review of its operations in Alberta which led to the conclusion that to remain viable in the province it would have to “re-focus” its business. In interview, Pembrdige CEO Bob Tisdale said the decision, which has resulted in a significant number of employee lay-offs, was a difficult one to make. “This certainly wasn’t our first choice,” he says. The decision followed last-minute changes to the auto insurance product in Alberta while companies had been preparing for the October 1 rollout of the new “premium grid”, on the eve of its implementation the government made changes to the grid which Tisdale says made it economically unfeasible for the company to write high-risk business in the province. Pembridge had planned to launch its Pafco brand in Alberta to deal with high-risk drivers, and to filter those drivers away from the Facility Association, the industry’s pool for high-risk drivers, as it is doing in Ontario and other provinces. Under the new calculation for high-risk drivers in the Alberta grid, “almost every single policy on our books would be capped”, Tisdale explains. Prior to the last-minute changes, the company had worked for months to reform its technology and underwriting systems to the new grid, he adds. “We still had an economically viable program prior to the changes.” The company has been in the province for 19 years, and Tisdale stresses that it will remain there offering standard and preferred business under the grid. He also notes that many of the other changes being made in the province, specifically to address rising claims costs, were welcomed by the company. However, he adds, the new grid pricing means that there will be significant savings for the highest risk drivers, including those with driving convictions, at the expense of lower risk drivers with clean records. “We cannot understand why the worst drivers in the province are going to get premium reductions Why would a person with an impaired driving charge see rates go down 50% while a person with a clean record will only see a 5% reduction?” Tisdale says the company is doing its best to keep on as many employees in Alberta as possible, and recognizes the expertise these employees have in dealing with non-standard auto. As the Pafco brand is launched in Ontario to respond to Facility depopulation, this new business will be handled “long distance” by employees in Alberta.