Beginning January 1, Alberta Drivers will Save an Average of $260 Under New System

EDMONTON, AB, July 2, 2026 /CNW/ - Alberta drivers are just six months away from significant auto insurance savings under the province's new Care-First system. On January 1, 2027, drivers will save an average of $260 annually while receiving Canada's most comprehensive recovery benefits packages if they are injured in a collision. In total, Alberta's approximately 3.1 million insured drivers are projected to save more than $830 million.

The new system is designed to reduce auto insurance premiums by removing the need for expensive litigation. Legal costs have been the main cause of rising premiums in Alberta, exploding by 65% in the past five years. With Care-First, those injured in collisions will receive faster access to medical care, rehabilitation and income support when they need it most. They will also have access to lump-sum payments for serious and catastrophic injuries.

"Alberta drivers pay some of the highest auto insurance premiums in Canada, but the trend of rising premiums will be reversed when Care-First takes effect on January 1, 2027," said Aaron Sutherland, Vice-President, Pacific and Western, Insurance Bureau of Canada. "Saving hundreds of dollars annually on auto insurance will be welcome news to Alberta drivers, as Care-First will help reduce rising legal costs and redirect these to improve affordability and expanded care for those injured in collisions."

Recent Statistics Canada data shows auto insurance premiums in Alberta are up 26% year over year, close to five times the national average. ATB Financial recently raised concerns in its commentary on the new inflation data, pointing out that Alberta is seeing the highest level of inflation in over two years "driven primarily by a jump in vehicle insurance premiums."

The alarming increase is being driven by several well-documented cost pressures in the system:

• Significant growth in legal costs (bodily injury claims). The number of lawsuits has doubled in the past year, as lawyers file more claims in advance of the government's Care-First reforms.
• Continued severe weather events such as hailstorms. These events are driving higher claims frequency and higher losses.
• Inflation in vehicle repair costs. Higher costs are particularly tied to parts, labour and advanced vehicle technology.

With rising auto premiums contributing to broader cost-of-living pressures across the province, the Care-First reforms could not come at a better time.

Strong public support for Care-First changes

Recent polling showed two-thirds of Albertans support the government's new Care-First auto insurance reforms, with the majority citing lower prices as the most important factor, according to a survey by Yorkville Strategies. The poll also showed that Albertans believe the province's Care-First system has struck the right balance to reduce legal costs, with the majority of respondents in favour of decreasing the ability to sue in exchange for the savings and improved benefits that Care-First provides.

"The new auto insurance system is coming at a critical time for Alberta drivers, with recent inflation numbers showing that the cost of auto insurance has been increasing more in this province than anywhere else in Canada," added Sutherland. "Alberta drivers deserve a break from these rising costs and help is on the way. And most importantly, they don't have to do anything to realize these new benefits."

About Insurance Bureau of Canada

Established in 1964, Insurance Bureau of Canada (IBC) is the national industry association representing Canada's private home, auto and business insurers. Its member companies make up the vast majority of Canada's highly competitive property and casualty (P&C) insurance market.

As the leading advocate for Canada's private P&C insurers, IBC collaborates with governments, regulators and stakeholders to support a competitive environment for the P&C insurance industry to continue to help protect Canadians from the risks of today and tomorrow.

IBC believes that Canadians value and deserve a responsive and resilient private P&C insurance industry that provides insurance solutions to both individuals and businesses.

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SOURCE Insurance Bureau of Canada