Province extending rate cap for insurance

By Lethbridge Herald on September 25, 2025.

Al Beeber
Lethbridge Herald

The Alberta government has put the brakes on higher rate premium  increases for drivers.

The government announced on Wednesday it is extending the rate cap for  one more year, meaning drivers with good records will continue to see  a 7.5 per cent cap when their premiums come due for renewal this year  and next.

“Albertans deserve an auto insurance system that works for them. By  keeping the rate cap in place this year, good drivers avoid higher  costs and keep more money where it belongs – in their pockets,” said  Minister of Finance and Treasury Board president Nate Horner in a  statement.

Eligibility for the rate cap in 2026 requires drivers to have no  convictions for major or minor traffic offences in the past three  years as well as continuing to meet existing criteria.

That criteria includes:

* no at-fault accidents in the past six years.

* No Criminal Code traffic convictions in the past four years.

The Automobile Insurance Rate Board is also limited from approving a  rate hike more than 12.5 per cent of all policyholders which is up  from 10 per cent.

Bill 47, The Automobile Insurance Act, approved earlier this year, is  expected by the government to further stabilize driver insurance rates  over a long-term basis when it’s implemented in 2027.

That Act, said the government, would introduce a privately-delivered,  care-centred automobile insurance system which in its opinion  “improves access to care after a collision.”

Accident victims would be entitled to income support and retirement  benefits depending upon the severity of their injuries, said  the  government when the Act was introduced.

Starting in 2027 all Albertan injured in a collision will get access  to enhanced benefits including rehabilitation and income supports,  improved medical treatment and for those with serious, longer-lasting  injuries a one-time permanent impairment benefit.

The province says that by reducing the need for litigation, the new  system will reduce litigation costs that it says drives up premiums to  help “deliver a more affordable and stable insurance system for all  Albertans.”

Alberta, as of 2024, had the third highest average car insurance  premiums in Canada at $3,151 annually.