Car Insurance Rates In Alberta To Go Up 5%

Posted by: Kenny Chan onAugust 1st, 2008

Drivers in Alberta are going to be paying more to drive their vehicles this fall as the Auto Insurance Rate Board has approved a 5% increase for insurance premiums. The increased premiums will take effect on November 1, 2008. The insurance companies initially wanted to hike rates by 37% but the Finance Minister made it clear that she would block any attempt to raise insurance premiums by more than 10%. The 5% hike works out to an increase of $30 for the average driver.

The insurance companies argued at a two day meeting last month that they would have to increase insurance premiums after a judge ruled that the insurance payout cap of $4,000 was unconstitutional. The Canadian Bar Association who was also present at the meeting last month presented a report that showed insurance companies made more than 20% profit from 2003 to 2006. The report suggests that insurance premiums, even without the payout cap should be decreased by 3.2%. The report also stated that injury claims were never out of control.

The board concluded that the impact of removing the payout cap would be covered by a 20% increase in premiums but chose to limit the increase to 10% due to the uncertainty surrounding the appeal of the judges decision to axe the payout cap. The 10% increase was offset by a -5% experience adjustment. In 2005, insurance premiums were reduced by 4% followed by a 3% reduction in 2006. For 2007 there was no change to the basic premium level.

Calgary Herald readers had mixed reactions to the 2008 basic insurance premium hike. Some are thankful it is only 5% while others are irate that the cost of driving is going up yet again. What do you think about the insurance rate hike?

Source: Alberta Automobile Insurance Rate Board



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Comments

  1. v2kai says:

    un-fricken believable…good i guess its only 5% and not what those blood sucking insurance companies want 37%!?()*&#@$% The report suggests should be decreased by 3.2% and we’re going up!? bollocks.

  2. Jayme Archer says:

    I’m pretty sure Alberta has a stead track record of rising insurance rates….

    If you ‘re looking to save on insurance, understanding insurance and the industry helps, so visit a forum and ask the questions you want answers to.

  3. […] raising the basic auto insurance rate by 5% last year, the auto insurance industry will be rolling back that increase after the Auto […]

  4. dave price says:

    A warning to all drivers in Alberta and B.C about a company called Canadian Direct Insurance. Canadian direct heavily promotes low car insurance rates. What they don’t tell you is that they offer great rates because they abandon you if you make a at-fault claim. My case went to trial last month at Calgary Queens bench. I took on their lawyers and appraisal manager from Vancouver to fight my simple and valid repair claim costs that they refused to cover. I was forced to sue because they fully ignored all of my communications. The judge awarded me a good judgement with costs so as far as the courts were concerned, I was in the right. I even had to sue them to recover my car rental even though I have full loss of use coverage on my policy. I am still out of pocket to the tune of about $2,000 in unrecovered hard costs because of the difficultly proving that their lousy claims service caused me those additional costs. I guess that is something I have to live with and only my restitution is to take my business elsewhere. The kicker is even with a court granted judgement I have yet to see a dime from them so I will likely have to file a asset seisure order with a bailiff to get them to pay me. How pathetic.

    Car Insurance is useless if the insurer avoid’s paying their claims. Save the hassle and give your business to an insurer that is well funded and actually pays their claims. Canadian Direct Insurance is not one of them and they will make your life hell.

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