Toronto, Ontario -- Allowing Alberta's injured drivers the right to sue following auto collisions could add another $136 to annual insurance payments, a new report has found.
Provincial legislators recently passed a bill that would transition Alberta's auto insurance system to a no-fault model, set to begin in 2027. As legislators finalize the design of the Care-First system, the government has indicated people injured in collisions may still be allowed to sue at-fault drivers.
The report, commissioned by FAIR Alberta and conducted by Deloitte, estimates that altering the province's newly installed no-fault model to allow for some lawsuits would drive up premiums.
Following the release of the report, the Insurance Bureau of Canada called on the provincial government to resist pressure to keep tort access in the new system and instead stay focused on ensuring victims receive the highest level of care to support their recovery.
"Litigation in Alberta's auto insurance system creates significant costs for Alberta drivers, said Aaron Sutherland, vice-president of the Pacific and Western regions for the Insurance Bureau of Canada said. "Removing this to improve affordability and care is the main reason the government decided to transition to its Care-First mode."
According to government figures, 9.7 percent of auto insurance payments are spent on legal activities.
"The provincial government designs and mandates the auto insurance products that insurers must sell," Sutherland added. "No other province with a care-based system permits the ability to sue as envisioned in Alberta because of the significant costs it adds for drivers, while doing nothing to improve care for those injured in collisions."
