The Government of Alberta is introducing a new auto insurance system, intending to have a full rollout by Jan. 1, 2027.
The new system for the province aims to "provide better and faster service while reducing auto insurance premiums."
The province is copying a system currently in place in Manitoba and Saskatchewan, which is called a "care-first" model.
"Under the new system, Albertans who suffer catastrophic injuries will receive treatment and care for the rest of their lives," notes a media release discussing the change.
"Those who sustain serious injuries will receive treatment until they are fully recovered. These changes mirror and build upon the Saskatchewan insurance model, where at-fault drivers can be sued for pain and suffering damages if they are convicted of a criminal offence, such as impaired driving or dangerous driving, or conviction of certain offences under the Traffic Safety Act."
In a news release, the province notes that currently, auto insurance is not affordable or care-focused.
Additionally, despite paying the second-highest rates in Canada, Albertans continue to wait for medical care and financial support in a system that "is complex to navigate."
"Albertans have been clear they need an auto insurance system that provides better, faster care and is more affordable," said Premier Danielle Smith. "When it’s implemented, our new privately delivered, care-centred insurance system will put the focus on Albertans’ recovery, providing more effective support and will deliver lower rates.”
The new model will remove the need for litigation in many cases of motor vehicle collisions, as those involved in collisions will receive the care they need. There will be no limits on care costs for medical and rehabilitation costs, as long as there is medical benefit. Other costs for treatments and other supports will be capped and adjusted yearly by the province.
In certain cases, where the at-fault driver is convicted of a Criminal Code offence or certain Alberta Traffic offences, litigation may still occur, and "bad drivers will still be held accountable through higher premiums."
The goal of the new system is for the maximum medical recovery possible in those dealing with a collision-related injury.
Under the new system, pain and suffering damages are removed, but injured parties may be entitled to a permanent lump sum between $1,000 and $187,000, plus out-of-pocket expenses, plus any ongoing care expenses.
It is believed that with the "care-first model" claims that would currently take years to be resolved would move to being resolved within months.
"High auto insurance rates put strain on Albertans. By shifting to a system that offers improved benefits and support, we are providing better and faster care to Albertans, with lower costs," said Drumheller-Stettler MLA and President of Treasury Board and Finance Minister Nate Horner.
Before the transition can fully take place, the province needs to work on legislation and regulation, develop a dispute resolution mechanism, develop a consumer support function, develop training and education for insurance professionals, and other elements.
The care-first model is expected to save drivers around $400 per year.
