Alberta is among the most expensive provinces to insure a vehicle and according to the Insurance Bureau of Canada, rates could rise more if urgent action is not taken.
According to new data from the General Insurance Statistical Agency (GISA), a statistical agency created and overseen by provincial insurance regulators, legal costs of insurance are partially responsible for the high rates.
“Alberta’s insurers are keen to work urgently with the government to tackle the cost pressures facing premiums and find ways to improve the affordability of auto insurance for drivers,” said Aaron Sutherland, vice president, Pacific and Western, Insurance Bureau of Canada (IBC). “Unfortunately, the action taken to date – including Alberta’s rate cap for good drivers – does not address the costs underlying drivers’ coverage and will do little to improve the price drivers are paying moving forward.”
IBC offered a few short-term actions that could address insurance affordability and save drivers an average of $325 per year. These include changing the province’s Grid rating program, which IBC says charges safe drivers more to subsidize premiums of high-risk drivers. “The Grid works against the very thing the government seeks to encourage – safe driving. It’s time this subsidy is removed.”
It also recommends removing the insurance premium tax, which IBC calls a hidden tax, and the provincial health levy on insurance. Removing these, according to IBC, could save drivers about $95 a year.
The GISA data also show Alberta ranked second in the country for the amount spent per claim to repair vehicles, as well as the frequency of theft.
Written by: Tyler Hay – MyLethbridgeNow
