Alberta is pausing increases on insurance rates for private passenger vehicles through the end of the year, the provincial government announced early Thursday.
No new rate increases will be approved for the remainder of 2023, the government says.
“We share Albertans’ concerns about the rising cost of living during the current inflation crisis. We will continue to meet with members of the insurance industry to find additional longer-term solutions for automobile insurance,” Finance Minister Travis Toews said in a release.
The announcement doesn’t mean no drivers will see their rates increase.
Prior approved rate changes, updated driving records and tickets as well as changes to home address or insured vehicle type could all result in an increase for some drivers.
In another change, the province is also now requiring insurance companies to allow most drivers with the ability to pay their premiums through payment plans.
The government blames “factors such as inflation and supply chain issues for auto parts” for the apparent failure of reforms brought in during the fall of 2020.
In December, Premier Danielle Smith said she wanted to take action on the file starting early in the new year, shortly after an Ernst and Young report found Albertans are paying the highest car insurance rates in Canada.
It sampled automobile insurance rates with an effective policy date of Sept. 1, 2022, across nine provinces for 27 customer profiles, with varying driver demographics, numbers of drivers, vehicles and accident history. For all but one of these profiles, Alberta’s insurance costs were the highest.
Opposition New Democrats have blamed the UCP government for the high rates, saying the government’s 2019 move to scrap a rate increase cap on auto insurers that had been imposed by the previous NDP government.