By MEDICINE HAT NEWS on May 19, 2026.

newsdesk@medicinehatnews.com
Changes to Alberta’s auto insurance system will include new rate caps for Alberta drivers.

The Alberta government is introducing an adjusted rate cap that will rollout alongside the care-first model coming into effect next year.

Starting Jan. 1, 2027, insurers will not be able to raise average rates by more than five per cent. Premium increases will also be capped at 10 per cent at renewal for all average drivers.

The UCP government says this measure will extend insurance to more Albertans.

“Our priority is ensuring the care-first system provides notable savings. We will continue to closely monitor the system’s implementation to ensure good Albertan drivers benefit from lower insurance costs,” said Minister of Finance Nate Horner.

Care-first auto insurance seeks to reduce costs by offering faster access to care and recovery after collisions and avoiding court battles. The system operates a “no-fault” model that will see an individual’s own insurer pick up the tab for medical treatment, rehabilitation and income replacement if they are injured in a car accident.

Drivers with an at-fault accident would still see their rates go up.

Albertans injured in a collision will still be able to sue an at-fault driver if they experience out-of-pocket expenses that exceed the amounts provided by their insurance policy.

A report by management consultant Oliver Wyman commissioned by the Automobile Insurance Rate Board suggests the care-first system will save drivers with basic insurance coverage an average of $366 annually per vehicle.

The new approach will replace the present Good Driver Rate Cap. Under that system, minor infractions could exclude Albertans from qualifying for 7.5 per cent cap protection.

Currently, drivers can lose protection if they switch their insurer, move to a different community or replace a vehicle.

The report from Oliver Wyman estimates the changes will result in significant increases to the average motorcycle premium.
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