Edmonton, Alberta -- Brokers across Alberta are unable to secure basic coverage for some clients because auto insurers are scaling back offerings or leaving the province entirely, an industry association says.
According to the Insurance Brokers Association of Alberta, the market failure comes as a direct result of the provincial rate cap on premiums. The cap, introduced in 2022 to keep auto insurance premiums from rising too quickly, denies insurers the ability to adjust premiums to match driver behaviour and growing repair costs and claim expenses
In a statement issued earlier this month, IBAA CEO Jhnel Weller-Hannaway said, “An insurance broker is a driver’s best resource to secure the best coverage at the best possible price. Unfortunately, as auto insurers reduce available coverages or withdraw from the Alberta market due to the rate cap, brokers are increasingly unable to find coverage options that are both accessible and affordable for many drivers in the province.”
She added that while the cap was intended to ease costs for good drivers, the system is “not working,” and called on the province to immediately lift the cap so the competitive market can return ahead of further reforms.
The IBAA isn't alone in voicing concerns about the impact of the rate cap on access to auto insurance.
According to one automotive sector lawyer from the province who spoke to Collision Repair, the problem is so severe that many drivers with a claims history or even minor infractions are finding it impossible to secure coverage at any price.
The message echoed warnings from the Insurance Bureau of Canada said repair and parts costs — especially those impacted by tariffs on materials — have pushed insurer claim costs up by as much as 10 percent. The Alberta Insurance Rate Board projected that bodily injury costs could rise by more than nine percent this year, with vehicle damage costs rising another 10 percent. The IBC also warned that climate-related claim severity was making risk calculations increasingly complex.
At the same time, the province is preparing to implement a new Care-First no-fault insurance model in 2027. But the IBAA argues that if the rate cap remains in place, the system will not reduce costs. Unlike Ontario’s no-fault approach, Alberta’s model preserves court access in some cases — adding cost and complexity. Weller-Hannaway warned that unless reforms go further to ensure affordability and restore insurer competition, Alberta risks ending up with the most expensive no-fault system in the country.
"There is still time for the government to succeed in its goal to build a better, more affordable system," said Weller-Hannaway. "We implore the government to lift the rate cap so that competition and choice can return to the market. We strongly recommend adoption of reforms that focus on care, while improving premiums cost and accessibility for consumers whether or not they are involved in collisions."
