New numbers confirm Alberta drivers facing higher auto insurance costs

Roughly 27 insurers operating in Alberta were granted rate hikes in recent months

New numbers confirm that many Alberta drivers are getting hit with rate hikes, and even some sharp spikes, in their auto insurance.

The Automobile Insurance Rate Board says that 27 insurers operating in Alberta were granted rate hikes in recent months, ranging from less than one per cent to almost 30 per cent for basic coverage on private passenger vehicles.

But the board, in its latest report, stressed that it now expects the changes to work not only for insurers, but also for drivers who were having trouble getting the coverage they needed under the old rate cap.

“Following nearly two years of rate restriction, some Albertans found it difficult to obtain the coverage they required or access to payment plans,” said the board in its fourth quarter report, issued Friday.

“These actions by insurers were directly related to their inability to receive approval for rates commensurate with the risk.

“The (board) expects insurers who received approval for a rate increase to cease practices that limit access to certain coverages for Albertans.”

The board said more than 92 per cent of the insurers offering coverage for private vehicles asked for rate changes.

The move comes after the insurance industry warned repeatedly that sharply rising payouts in recent years had put it in a financial squeeze, and those problems were worsened when a five per cent ceiling on rate hikes was imposed two years ago by the former NDP government.

Last fall, the new United Conservative government lifted that cap, saying it wasn’t working because some Albertans were not able to access certain non-mandatory coverages or payment plans.

Celyeste Power with the Insurance Bureau of Canada said the new hikes are about 10 per cent on average per insurers, but that average will vary widely depending on driver records and how many drivers each firm insures.

She said the increase is not a surprise.

“Insurers actually don’t want to increase rates. They would rather keep their customer happy, give them the best rate possible,” said Power.

“But we have seen increasing claims costs over the past few years that have become quite unsustainable, and that’s when you see premiums follow.”

She said she hopes longer term reform will come from a provincial panel currently reviewing the entire auto insurance system to determine ways to improve it for the industry and drivers.

The panel is to report back in the spring.

Alberta Finance spokeswoman Jerrica Goodwin, in a statement, stressed that the board makes its rate decisions independent of government.

“Today’s release shows many companies with combined rate hikes below five per cent,” said Goodwin.

“Given the numerous options available, we encourage Albertans to shop around for the best rate.

“We will be taking action in the coming months to address long-term affordability in a sustainable manner.”

Jon Carson, the Opposition NDP critic on auto insurance, said the five per cent cap was reasonable, noting some firms in the latest report managed to keep their hikes to five per cent or less.

He urged the government to bring the cap back, adding that the UCP removed it last August with no consultation.

“Albertans are paying hundreds of dollars more in auto insurance alone and that’s very concerning,” said Carson.

Dean Bennett, The Canadian Press

Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Lacombe Police respond to break-in at Gary Moe Chrysler

Police conducted a search of the building and located significant damage inside the business.

Lacombe Police respond to alarm at LA Carpet and Tile

Video footage was obtained, a black dodge Caravan was observed with a lone male occupant

Woofs and Laughs coming to Lacombe Memorial Centre

Comedy night supports Saving Grave Animal Society

Lacombe County fire permit season begins March 1

Lacombe County reminds people that permit requests are free and easy to submit online

Lacombe IODE chapter supports Alberta Council of Womens Shelters

Lord Lascelles Chapter looking to raise $100,000 for children exposed to domestic violence

WATCH: Night Among the Stars Celebrity Dance-off supports Lacombe BBBS

Over $12,000 raised for Dancer’s Edge Parents Association and Lacombe BBBS

Courts to decide regarding Ponoka County’s north-west area structure plan

Ponoka Right To Farm Society versus Ponoka County

Canada prepared to monitor for community spread of COVID-19: Tam

The U.S. confirmed one case of the new coronavirus, or COVID-19, in California Thursday

11-year-old Sylvan Lake burn survivor using his story to inspire others

Kaden Howard was recently named the 2020 Champion Child for the Stollery in Edmonton

Conservative MP questions whether rail blockades constitute terrorism

Crown-Indigenous Relations Minister Carolyn Bennett travelled to B.C. to meet Indigenous leaders

Lawsuit over African mine can be heard in British Columbia: Supreme Court

B.C. courts dismissed Nevsun’s attempts to make Eritrea the forum for any lawsuit proceedings

MPs to examine privacy implications of facial-recognition technology used by RCMP

The MPs will look at how the technology affects the privacy, security and safety of children

Winners and losers in Alberta’s 2020 budget

UCP government has tabled a new 20-per-cent tax on vaping devices and liquids

‘Finer focus on job creation:’ Alberta government files red-ink budget

Projected deficit of $6.8 billion on revenues of $50 billion

Most Read