Alberta’s roads are busy, and with that traffic comes the inevitable possibility of motor vehicle accidents. Unlike some provinces, Alberta currently operates under an “at-fault” insurance system. This means that after an accident, determining who is responsible significantly impacts how insurance handles the aftermath.

On April 26, 2024, the Alberta Government released two new automobile insurance reform studies and launched a public automobile insurance reform survey to gather public feedback. Automobile insurance is an incredibly complex issue, and Albertans should be consulted about what they value and want in a provincial insurance system.

This blog post will serve as a guide to help identify and demystify individual rights under the province’s current at-fault system. It will break down key concepts, provide guidance on current fault determination, and provide an overview of how a no-fault insurance system could impact Albertans.

Understanding Alberta’s “At-Fault” Insurance System

Alberta currently operates under an “at-fault” automobile insurance system. This allows an innocent injured party to sue the party or parties responsible for their accident-related injuries. Through their personal injury claim, an injured party is able to recover compensation in the form of monetary damages. The insurance company of the person deemed “at-fault” will pay for the losses of those involved in the accident. This system holds drivers accountable for their actions and injured parties can sue the at-fault driver’s insurance company for additional damages.

Under an at-fault insurance system, if you purchase automobile liability insurance and cause injury to another person or vehicle as a result of an accident, your insurer is obligated to pay for the damages that are covered by your insurance policy, subject to the terms and limitations specified in your policy. Although Albertans pay higher premiums on automobile insurance policies, they retain the right to sue the party or parties responsible for their injuries after an accident.

Alberta Government Considering a “No-Fault” Insurance System

The Alberta Government is considering moving to a “no-fault” auto insurance system. This insurance system is supported by the insurance industry and has been canvassed in new government reports. However, under a no-fault insurance system, the rights of injured individuals are not protected, as bad drivers are rewarded with the removal of accountability, and compensation for at-fault drivers and innocent victims is approached in the same manner. 

What is No-Fault Insurance?

No-fault insurance is a system of automobile insurance where each party is entitled to compensation through their own insurance provider. Although a person must generally be responsible for the consequences of their actions, a no-fault insurance system violates this principle, as it lets bad drivers off the hook and does not require them to pay for their mistakes.

Under no-fault insurance systems, individuals cannot sue the party responsible for their injuries resulting from a motor vehicle accident and the control of a claim is placed in the hands of a profit-motivated insurance company. Parties forfeit the right to bring a claim in exchange for “benefits” provided by their insurer. These benefits may include compensation for medical treatment and disability, but these do end and do not adequately substitute the heads of damages you would otherwise be entitled to under a fault-based system.

After an accident, an at-fault driver in an accident may see an increase in their premium, however, they are not deterred from their wrongful conduct and may be rewarded and subsidized by good drivers. Premiums of innocent victims will likely also increase regardless of their driving record.

How Could No-Fault Automobile Insurance Impact Albertans?

If Alberta introduces a no-fault automobile insurance system, the rights of innocent parties will be taken away and bad drivers will not be held accountable for their actions. Injured parties will also receive poorer treatment as various benefits will be taken away from them. Further, no-fault insurance systems do not necessarily deliver premium savings for consumers or taxpayers money; rather they transfer costs previously on insurance companies to individual families, the provincial healthcare system, and social assistance systems.

Albertans will also be stripped of their right to sue and challenge an insurance company in court without alternative recourse to any decision made by the insurance company. No-fault automobile insurance takes a “one-size fits all” approach to all matters, which primarily benefits the insurance companies and bad drivers, and removes consumer choice from the system.

Final Thoughts on Alberta’s Automobile Insurance Reform

Ultimately, Alberta’s automobile insurance system could be reformed to promote affordability, accountability, and expand consumer choice, without switching to a no-fault automobile insurance system.

Albertans should keep themselves informed and up-to-date with reforms and changes to our province’s automobile insurance regulations. It is important to conduct your own research to educate yourself about the specific impacts, options, and potential limitations associated with each type of insurance system. Albertans are encouraged to visit FAIR Alberta to learn more about automobile insurance reform and fill out the Government’s engagement survey so their voice is heard.

Contact the Experienced Accident Lawyers at Cuming & Gillespie in Calgary for Trusted Representation in Your Injury Claim

The knowledgeable personal injury lawyers at Cuming & Gillespie in Calgary regularly help clients navigate the claims process following a car accident, slip and fall, or pedestrian accident. We know that navigating your next steps after an accident can be overwhelming, which is why we manage your claim from commencement to settlement, allowing you time to prioritize your health and recovery. We work hard to ensure that our clients recover the maximum compensation. To schedule a confidential consultation with a member of our personal injury team, please contact us online or call us at 403-571-0555.