We think a large part of our job as personal insurance brokers is to keep people informed about the insurance industry and how it relates to both policies and insurance rates. Currently, there are a lot of things happening in the industry that are affecting rates, renewals and coverages. As professional insurance advisors, we want to make sure everyone understands the current insurance landscape.
So what happened to the insurance industry in Alberta?
In November 2017, Joe Ceci issued an order limiting auto rate hikes to five percent. Sounds good for people looking for insurance. But in reality this rate cap has put insurance companies in a situation where they can no longer afford to do business in Alberta. In fact, many insurance companies are actively looking for ways to limit their growth in the auto insurance sector.
So what does this all mean for your auto insurance? It means:
- You might be looking at a rate increase – no matter who your insurance carrier is
- If you have a speeding ticket (or other minor traffic infraction) you’ll be charged a minimum 5% surcharge – regardless of your carrier
- If you have a distracted driving ticket (or other major traffic infraction) you could be charged up to a maximum of 100% surcharge – regardless of your carrier
- You might need to be open to adjusting your coverage or deductible in order to lower your rates
- If you’re hoping to finance or lease a vehicle, you’ll need to confirm your available coverage options and rates before you start shopping
- If you have credit issues, you may not qualify for a payment plan or may be denied optional coverage
If you’re interested in reading more about the insurance landscape in Alberta here are a couple articles that are discussing the situation:
- Why today’s safer cars aren’t driving down insurance costs yet July 15, 2019 CBC News
- NDP cap on auto insurance rates leads to higher costs, fewer choices, says industry. April 23, 2019 calgaryherald.com
- Roadblocks ahead for Alberta drivers trying to get insurance. May 13, 2019 globalnews.ca
And as a last thought, now is a really good time to find out more about the rules around distracted driving in Alberta.