Edmonton, Alberta — Alberta drivers are bracing for potential car insurance hikes in the new year, the provincial government has created a committee to examine what ails the system.
Earlier this year, the United Conservative party government cancelled the former NDP government’s five percent cap on insurance premium increases, prompting premium hikes of nearly 12 percent. Alberta Finance Minister Travis Toews said he is hearing from concerned consumers and insurance companies, who say they’re selling insurance at a loss.
“The cap was really putting a Band-Aid on a problem that just continued to fester,” said Toews. “Ultimately, it didn’t deal with the problem at hand.”
Toews appointed Chris Daniel—who is also a consumer representative on the Automobile Insurance Rate Board, which approves car insurance rate hikes in Alberta—as the committee’s chairman.
The province’s problems include rising payouts as a result of natural disasters like the 2016 Ford McMurray wildfire, Alberta’s higher-than-normal rate of auto theft, hailstorms and the escalating cost of injury claims, said Daniel.
Lawyer Shelley Miller and Dr. Larry Ohlhauser have also been appointed to the committee, which aims to find a “real solution” and make recommendations to the government for reform by next spring. It has a budget of $1-million.
Although the panel has no preconceived outcomes, on the table could be some form of no-fault insurance coverage, limiting the conditions under which an injured person can sue an at-fault driver for pain and suffering stemming from a crash.
The province has also said offering government-run insurance like B.C. and Saskatchewan is not an option.