World News

Alberta announces limit on auto insurance hikes for ‘good drivers’ | CBC News

[ad_1]

The Alberta government will limit auto insurance premium hikes to the rate of inflation for motorists they deem to be “good drivers.”

Premier Danielle Smith announced the measure at the legislature today, flanked by Finance Minister Nate Horner and Affordability and Utilities Minister Nathan Neudorf.

In a change of tone from the UCP government, Horner now also says he’s keeping an open mind to a no-fault system of insurance and possibly creating a public insurance Crown corporation like in Saskatchewan and British Columbia.

The rate hike limit will be short-term measure, Horner said, while an external consultant studies other jurisdictions and recommends longer-term reforms to Alberta’s auto insurance system. Alberta drivers pay some of the highest premiums in the country.

“This is not sustainable either,” Horner said of the new premium cap, set to take effect in January 2024. “Nothing in this package really gets at the cost associated to auto insurance.”

The incoming limit on drivers’ rate increases would be tied to the consumer price index, as measured in September of the previous calendar year. That means in 2024, drivers who stick with the same insurance company could not see their premiums rise by more than 3.7 per cent, according to the province.

A “bad” driver would not be protected from such rate hikes, and include those who:

  • Had one or more at-fault crashes in the last six years
  • Had a criminal code traffic conviction during the last four years, such as impaired driving
  • Had a major traffic conviction during the last three years, including distracted driving or speeding in a school zone
  • Had a minor traffic conviction in the last three years, such as failure to stop or following too close

The province estimates the majority of Alberta drivers would be considered good drivers under the new definitions, but did not have hard numbers.

However, the measures wouldn’t help new drivers or people who switch to a different insurance company for coverage.

The government is also giving the Automobile Insurance Rate Board new powers to demand insurance companies return some profits to drivers during “exceptionally profitable years.”

The province also plans to make permanent a requirement for companies to provide most customers with payment plans so they don’t have to fork over a chunk of cash once a year.

[ad_2]

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button