587-597-5478 heather@thinkinsure.ca
Government Changing Auto Insurance

Government Changing Auto Insurance


Effective January 1, 2022, the Direct Compensation for Property Damage Regulation will change the way vehicle damages are handled in Alberta.  Why is the Government changing auto insurance in Alberta and how does that impact you, the consumer?

Why is the Government changing auto insurance in Alberta?

Auto insurance premiums continue to escalate in Alberta for a number of reasons including:

  • Newer model vehicles involved in a collision cost more to repair because of the sophisticated computer systems. A small bump can easily cost $2,000 just to reset the systems.
  • Alberta is now the vehicle theft capital of Canada. Although Alberta represents only 12% of the Canadian population, we represent 27% of all vehicles stolen across Canada.  In 2019 Ontario logged 23,992 stolen vehicles while Alberta came in at 23,535!
  • Alberta has more catastrophe claims than any other province in Canada. That includes flood, fire and hail claims.

The Government of Alberta in conjunction with industry realized that streamlining the claims process could save money and help stabilize or even reduce premiums.

How does the Government changing auto insurance impact you, the consumer?

Effective January 1, 2022, if you are involved in an auto collision, you will deal with your own insurance company with respect to your vehicle damages.

  • If you are at fault, you must carry collision coverage to recover your losses, subject to your deductible.
  • If you are not-at-fault, DCPD will apply and you will still deal with your own insurance company. All insurers must offer a zero deductible option for DCPD.
  • If you choose a deductible, this would help reduce your premium, however the deductible will apply to a claim, and you can’t recover the deductible amount from the at-fault driver.
  • Fault and/or the degree of fault is now clearly outlined in the Regulation.

How will this affect my claim and my premium?

Because you are now dealing directly with your own insurance company, your damages will be handled more efficiently and without the complications of dealing with the at-fault driver’s insurance company.  It also eliminates the costs involved with subrogation.  That’s where insurance companies have the right to recover the vehicle damage costs from the negligent at-fault driver.

It is estimated that 42% of drivers will see a reduction in their premiums, 15% no change and 43% will see an increase of premium.  These changes will more accurately reflect the cost to repair your vehicle.  Owners of less expensive vehicles that cost less to repair will typically pay less for their insurance. Similarly, owners of more expensive vehicles that cost more to repair may pay more. It’s a fairer system for everyone.

Do you have to do anything with regard to your insurance?

No, as the DCPD legislation is automatically effective January 1, 2022.  One word of advice, however.  If you do not carry collision coverage in your auto insurance contract and you are at-fault for a collision, you will have to deal with your repairs out of your own pocket, just like you do today.
In Alberta, it is the law that you carry a minimum of $200,000 Third Party Liability, Accident Benefits, and soon DCPD coverage.  All other coverage remains optional.  However, it is important that you understand what the optional coverage includes and also what extensions of coverage you may need.  Always speak to your insurance broker to review the options.

Heather Cournoyer, CIB, CIP, is a seasoned insurance professional specializing in serving the
needs of business in Alberta and BC.  She believes that consumers need to understand their
 insurance program so that there are no surprises in the event of an unfortunate unforeseen loss. 
Contact her at heather@thinkinsure.ca or 587-597-5478 for further information.



This is a quote from the movie Network a 1976 film about a TV Network and exploitation. And that’s exactly how I and many insurance industry professionals and consumers are feeling right now. And it’s not about a TV Network. It’s about auto insurance in the Province of Alberta and how the NDP Government are causing hardship to many Alberta Consumers!

For those of you who don’t remember the film check out this link! https://en.wikiquote.org/wiki/Network_(film)

In November of 2018 I wrote a letter to multiple political representatives on both sides of our current government. Here’s an excerpt of my letter:

On December 4, 2017, the NDP Government thought it wise to impose a 5% cap on increases for auto insurance across the province.  That’s akin to telling all grocery stores that they can’t increase their cost of meat or milk at the retail level when they don’t control their wholesale costs.  So, what does the grocer do?  He has to make up for his losses somewhere.  He has several choices.

1. Stop selling meat or milk at all.  

2. Increase the cost of his other products to make up for the shortfall.

3. Reduce the quality of the product he sells.

4. Close all his stores in the Province.;

I can tell you now that this is precisely what you are forcing the private insurance companies in Alberta to do.  And guess who is now being affected in a very major way.   CONSUMERS – the very people you were intending to help.  Yes, and your consumers are your VOTERS! 

I am also a consumer and a voter.  I am also an insurance broker in Alberta and have been for 42 years.  I’ve seen hard and soft markets and this is the worst situation that I have ever experienced in Alberta!!

Here’s a notice from just one of the insurers that my brokerage deals with:

“The unfortunate reality is that when regulators intervene to artificially control market conditions – either because they don’t accept insurers’ data and loss trends, or because they’re politically motivated to keep premiums low – then companies are forced to seek alternative ways of stemming losses, deflecting business and preserving capital.

I know that some of these measures are tough for customers to understand and it’s unfortunate that the industry finds itself in this position. However, these situations only reinforce your role and I truly think customers will see the fantastic value that you provide with your guidance and counsel. On our end, we continue to actively work with regulators and provincial governments to rectify this situation and bring valuable reform to the financial performance and stability of the industry overall.”

Here’s the response from Joe Ceci, our Minister of Finance who continues to ignore and delay in hopes of possibly being re-elected? 

“Dear Ms. Cournoyer:

The Honourable Rachel Notley, Premier of Alberta, has forwarded a copy of your November 1, 2018, email regarding automobile insurance in Alberta. Premier Notley has asked me to respond on behalf of our government. As President of Treasury Board, Minister of Finance, responsible for the Insurance Act, I am pleased to respond. 

Through the five per cent rate increase limitation, our government’s goal is to strike a balance between Albertans’ need for fair and affordable automobile insurance and the insurance industry’s need for a viable and sustainable market. My department is working very closely with the Insurance Bureau of Canada, the Insurance Brokers Association of Alberta, and insurance company representatives to find the right balance for both consumers and the industry. While we recently extended the cap, we did so for only nine months to give us time to find longer term solutions to the issues industry is facing. To this end, we are conducting a claims and costs study to provide government with information about cost pressures industry is experiencing.

Our government is aware that some insurance brokers, such as yourself, are facing challenges resulting from insurers attempting to reduce their exposure in Alberta by taking various actions, such as cancelling broker contracts, restricting access to premium payment plans, and limiting access to coverage. The Office of the Superintendent of Insurance is monitoring the situation closely to ensure that automobile insurance remains available for Albertans, and that insurance companies remain compliant with the Act. If you have information that an insurance company has violated the Act or its regulations, please contact the Superintendent toll-free by telephone, at 310-0000 (wait for the tone, then dial at 780-643 2237), or by email at tbf.insurance@gov.ab.ca.

In Alberta, we continue to benefit from a competitive market, and property insurance remains readily available. In order for Albertans to find the best rate and product, I encourage consumers to shop the open market to ensure their needs are met. Insurance brokers, such as yourself, are well equipped to find consumers appropriate coverage at the best price. I also acknowledge that insurance can be confusing and difficult to understand for some Albertans, including seniors. I commend you for your professional dedication in helping Albertans find and understand the coverage that best meets their needs.

Thank you for taking the time to write.


Joe Ceci

President of Treasury Board,

Minister of Finance”

Just this morning I have dealt with three individuals who have impeccable driving records, no claims and are simply trying to make a living to support their families. All of the following situations are a direct result of our Provincial Government interfering in private industry! I might add that I don’t do a lot of personal insurance. I’m a commercial insurance broker so 90% of by clients are business owners. 

1. Insured, who is a senior citizen, has been on a monthly payment plan for years and 30 days prior to renewal is told he won’t have a payment plan this year. He must pay over $1,000 upfront or as of April 30 will have no insurance. This widower is on a very fixed income. So, does he park his car, not buy groceries, not buy house insurance?

2. Long time client of insurer is told they must complete a new application on renewal which the client is doing. By completing a new application, this now gives the insurer the right to not offer physical damage coverage and possibly take away their monthly payment plan. How will this family of 4, living pay cheque to pay cheque come up with $5,000 to pay their auto insurance premium within a very short period of time?

3. Broker in Alberta has had their contract to write insurance with one of their companies cancelled. Insured starts shopping for insurance. Two brokers already have had to turn him away as the companies they deal with will not provide physical damage coverage nor a payment plan. All they can offer is coverage through The Facility Association at an extremely high premium. The client’s insurance expires on April 4! He’s still shopping!

Again quoting the  Honorable Joe Ceci:

“The Office of the Superintendent of Insurance is monitoring the situation closely to ensure that automobile insurance remains available for Albertans, and that insurance companies remain compliant with the Act.”

All I can say to him and his government is that it’s not working! The insurance companies are in fact following the letter of the law! The laws the Government of Alberta has put in place! 

And it’s the consumers in Alberta who are suffering once again.

Yes, I’m mad as hell and for my part I will keep fighting for my clients!

So, what can you do?

I call on all insurance professionals in Alberta to send an example of hardship caused to Alberta consumers!

I call on all consumers who have been affected or if you know someone who has been call or email. 

Superintendent of Insurance – toll-free by telephone, at 310-0000 (wait for the tone, then dial at 780-643 2237), or by email at tbf.insurance@gov.ab.ca.

Heather Cournoyer, CCIB CIP – contact:  heather@thinkinsure.ca