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Please join the AIRB for the first in a series of informative lunch-time webinars on February 27th. Our first speaker is Kay Wakeman, Director of Insurance Outreach from IIHS-HLDI (Insurance Institute for Highway Safety-Highway Loss Data Institute).
Click here to register for free today! Download details here.
The grid rating program was developed to establish the maximum rate that insurance companies can charge for basic coverage third-party liability (bodily injury & property damage tort), accident benefits, and direct compensation property damage (DCPD). Insurance companies must compare a driver’s rate under their current rating program to a driver’s rate calculated by the grid and charge the lesser of the two rates.
Download our infographic to learn more about the grid.
Since you’re on the AIRB website, you obviously know a little about us. But did you know that 69% of surveyed Albertans had never heard of the AIRB?
We want to make sure that Albertans know about the tools and resources we offer to help them navigate the auto insurance market, so we’ve launched an awareness campaign. You might see our billboards, online advertising, and commercials in the coming months.
We’ve decided to lean-into the fact that when you google “AIRB” (pronounced AIR-bee) you’re often prompted to visit a company that sounds similar.
To be honest, the AIRB is a great place to get information, tools, and tips on auto insurance but a terrible place to go on holiday.
Visit us today at our new consumer website – www.airbfordrivers.ca
Choosing the right coverage can be a difficult task and involves plenty of research into companies and quotes. It’s important to pick only the coverage you need and take your situation into consideration when choosing. However, apart from only buying the mandatory coverage for your vehicle, there are quite a few ways to save money and get the most out of your insurance dollars. Companies take many factors into consideration when deciding a premium, and they all use a different algorithm. Find the right company for your situation, and consider these tips to reduce your rates:
Always ask your insurer about possible discounts that you may qualify for as every company is different. Comparing multiple car insurance policies not only prevents you from overpaying for car insurance, but also provides drivers with a peace of mind.
Follow our socials for weekly information and tips:
In Alberta, road conditions change frequently and often. Between summer and winter, we can deal with a large amount of snow, ice, graveled roads, and construction. When the driving conditions are so varied, knowing more about specific Alberta roads can improve your driving experience when the weather is unpredictable. That’s why we’ve compiled a list of Alberta’s top 10 most dangerous intersections, helping you prepare for these intersections before you approach one.
The Top 10 Dangerous Intersections in Alberta:
Within Alberta, the two major cities of Edmonton and Calgary have the highest populations, explaining why the most dangerous intersections in Alberta are located in these cities. Traffic density can play a crucial role in these intersections, causing drivers to make riskier driving moves than they normally would. Another notable intersection in Alberta is the Highway 595 (Delburne Road) and Township Road 262 intersection in Red Deer. Although even in cities with smaller populations and less congestion, intersections can be dangerous and must be approached with caution.
Some communities like Lethbridge are taking intersection safety very seriously. Back in January, the city focused on intersection safety, recognizing the common driver errors that cause these accidents as: “following too closely [behind a vehicle], making an unsafe left turn, or failing to stop at a stop sign or a red light.” While we can know about these high-collision intersections, only we can control the way we drive.
Stay in control of your vehicle by maintaining a safe distance around other vehicles, ensuring your left turns are safe and timely, and keeping an eye out for cold green lights and stop signs. Be careful when driving through these dangerous intersections and keep your wits about you.
A great way to practice your driving skills and reach a higher standard of driving is by using the TrypScore app. TrypScore scores your driving, highlights areas for improvement, and offers educational videos, challenges, and prizes. AIRB is partnering with TrypScore in the “100 Safest Days” campaign to combat the dangerous summer period known as the “100 Deadliest Days.” This effort aims to reduce traffic collisions, including those in intersections, and make summer safer. With engaging competitions, challenges, and rewards, these 100 days can be transformed. Download TrypScore to make a positive change on your community roads today!
Following the announcement of the Good Driver rate cap in November 2023, Albertans were expecting the rate relief to apply effective January 1, 2024. However, in accordance with the Ministerial Order, the rate relief only applied once the AIRB approved the changes to the insurer’s rating program and the insurer implemented them, leading to situations where a good driver would see an increase over the announced inflation cap from January 1 until their insurer implemented the Good Driver rate cap.
Given the Good Driver rate cap implementation time, the AIRB issued a Bulletin to all insurers setting forward expectations on communication with policyholders:
“As policyholders will be concerned if their premium increases above the threshold set by government, it is incumbent upon insurers to explain why a premium for a good driver is increasing above the announced 3.7%… In the event a renewal notice has gone out to a policyholder for a 2024 renewal, the AIRB expects follow-up communication be sent to the policyholder providing a detailed explanation of the premium increase.”
The AIRB requested from insurers a sample of the letter sent to policyholders who fit the Good Driver criteria but experienced an increase over the permitted 3.7%
The Communicating the Good Driver Rate Cap report reviews the policyholder letters and makes a recommendation for the AIRB to provide more explicit direction and wording for insurers in the future.
Click here to read the full report.
According to recently released data from the General Insurance Statistical Agency (GISA), Albertans paid an average of $1,669 in 2023 for auto insurance, compared to $1,586 in 2022 – a 5.24% increase.
The Automobile Insurance Rate Board (AIRB) was in full compliance with the Ministerial Order that directed the AIRB to pause rate approvals until 2024, however there are several ways your insurer’s approved rating program can impact your premium without filing with the AIRB for a rate increase.
It is important to note there were previously approved rate increases still being implemented in the market. Rate approved in late 2022 were still being implemented during 2023; it takes twelve months for rate to fully flow to all an insurer’s customers.
Premiums may have been impacted during the rate pause if you had a new at-fault claim, a new traffic violation added to your driving record, changed vehicle, added a new driver to your policy, and/or changed your home address. These actions, taken by the policyholder, can have an impact on the premium you pay.
Many drivers have discounts which over time decrease – such as a new business discount which your insurer offered you to attract your business. Over time the amount of this discount reduces on renewal. Another example is a claims or convictions free discount. You may have one traffic ticket and your insurer may not surcharge for one offence but will remove your conviction free discount; this will increase your premiums.
Insurers use driver age as one measure of risk or likelihood of getting in an accident. As we age there are medical conditions which can affect driving performance, and with reduced response time older drivers are riskier from the insurer’s perspective.
Vehicle age also impacts your insurance premium. As a vehicle ages the availability of parts, cost to repair can change. Many insurers use a variable called “vehicle rate group” which considers the likelihood of a car being in an accident and the cost of repairs or value in event it is written off. Recent inflationary pressures have increased the cost of repairing what was once considered a little fender bender will result in a write-off of the vehicle. Not all vehicles depreciate at the same rate, and this can impact the premium calculated as part of the insurers approved rating program.
Lastly, Alberta has experienced population growth in the last few years. There are 3.2% more vehicles insured in 2023 over 2022. The increased traffic can have an impact on collisions and claims. Also, new Albertans from outside Canada are generally rated as “new drivers” and pay higher insurance rates on average because of the lack of Canadian driving experience. This can drive average premiums higher when you look at the province as a whole.
In conclusion, the 5.24% increase in auto insurance premiums for Albertans in 2023 can be attributed to a combination of factors beyond the rate pause. Existing approved rate increases, individual policyholder actions, and changes in personal circumstances such as at-fault claims, traffic violations, and vehicle changes all contribute to fluctuating premiums. Moreover, the gradual reduction of discounts and the insurer’s assessment of driver and vehicle age play significant roles. Understanding these variables can help Albertans better navigate their insurance renewal and anticipate potential changes in their premiums.
As a driver, you have many choices when deciding the auto insurance coverage you want to purchase. The amount of coverage affects the cost of your premiums. The key to getting the most out of your insurance dollars is comparison shopping, comparing coverage prices from different insurance companies .
What type of coverage is right for you?
No matter what type of insurance you get, make sure you understand what your policy covers in the event of a collision. Mandatory coverage is auto insurance you MUST have as a driver. Without this coverage you are driving uninsured. Driving uninsured can result in fines, jail time, and the suspension of your licence. Mandatory coverage includes:
Some drivers may also get optional coverage for additional charges to cover more damage scenarios. Examples of optional coverage include:
If you lease or finance your vehicle, your financing agreement might require certain additional coverages. If your vehicle is older and run-down, you may not want collision coverage if the additional cost is around the same amount you would receive from a claim. Know your budget and coverage needs.
What information do you need to provide?
Who do you contact and how?
After deciding what coverage is right for you, look around at the price for coverage at different insurance companies. To decide which company would provide the best price for your situation, use our rate comparison tool. To do this, you can talk to:
Follow our socials for weekly information and tips:
Insta: https://www.instagram.com/albertaairb/
Facebook: https://www.facebook.com/albertaairb
In recent years, there has been a lot of discussion about the affordability of auto insurance. Affordability is a subjective term, and it is difficult to develop one measure to clearly state whether it is affordable. Unlike like other goods and services Albertans must purchase, there is not a single price everyone pays. Insurance companies individually price auto insurance based on the individual driver, the vehicle and where they drive, which means no two drivers have the same price.
One measure the AIRB has used as a proxy for affordability is the percentage of after-tax income spent on auto insurance premiums. The Automobile Insurance Affordability Report adds Canadian census data to General Insurance Statistical Agency (GISA) data to review affordability ratios.
Some of the report’s findings are:
This report supports the need for broad auto insurance reforms to address auto insurance affordability and stabilization of premiums for Alberta drivers.
In the face of rising unaffordability, we encourage drivers to exhibit safe driving behavior to control their premiums and keep them low, and highly encourage shopping the market, as it can save hundreds or thousands of dollars each year on premiums.
Click here to read the report.
Interact with regulators and discuss how consumer expectations and legislative changes are opportunities to better serve Albertans.
Discussion & Insight
June 19, 2024, 8:30 a.m. to 2 p.m. In-person, Edmonton
Register on Eventbrite today!
