According to the Automobile Insurance Rate Board, Albertans are paying the second-most in the country for auto insurance, with an average premium of $1,835. Dinesh Sherma has been living in Alberta for more than 18 months and noticed the increase in cost when he moved here from British Columbia. “It’s pretty expensive here,” Sherma said. “In B.C., I was paying almost $200 monthly, and (here), I’m paying almost $400.” Morgan Roberts, the vice-president of insurance at Ratehub, which compares monthly premiums from across the country, said Alberta’s “are high.” “Out in Alberta, there is an increase in theft right now, so that impacts insurance,” Roberts said. “The more theft you have, the higher the loss ratios, the more the insurance companies have to pay out.” Roberts also pointed to a 40 per cent jump in collision-related lawsuits between 2018 and 2022, leading to more than $1.2 billion in settlements. “That will also make insurance go up,” Roberts said. According to AIRB, more than 55 per cent of insurance premium goes toward bodily injury coverage. “Which is a coverage that applies in the event that you’re sued for injuries that you cause in a collision and that has been jumping, and that’s what’s putting pressure on premiums,” said Heather Mack, manager of education and engagement with AIRB. The average bodily injury claim was approximately $83,000 in 2020, which has soared to more than $140,000, according to Mack. “This is very unique to Alberta right now,” Mack said. The Insurance Bureau of Canada said rates are up more than 10 per cent in Alberta, in part due to legal disputes and legal pressure in the auto insurance system, rising 34 per cent year over year. Weather-related events have also impacted premiums. “Alberta has the most severe weather-related events, so your hail events cause a lot of claims for vehicles, which also causes a lot of insurers to have to pay out,” Roberts said. In a statement, the Ministry of Finance told CTV News, “Alberta’s government is aware that factors such as inflation, legal fees, increased vehicle theft, weather-related losses and tariffs are putting pressure on the auto insurance market in Alberta.” Starting Jan. 1, 2027, the province will implement its care-first insurance model, which it said “will reduce the time and money spent on litigation, leading to more stable and more predictable rates for Albertans.” Aaron Sutherland, Insurance Bureau of Canada vice-president, says other provinces have taken similar steps to reduce litigation measures. “We’re the only province that has yet to take action on litigation and legal abuse,” Sutherland said. “Places like British Columbia, Saskatchewan and Manitoba—they have all done it.” “By pulling litigation out of the system, they are also going to be able to improve the price you are paying for insurance moving forward.”
