It appears changes may be in store for auto insurance in Calgary and throughout Alberta, thanks to a government proposal that would tighten up regulation of the province’s insurance industry. While you may be worried that increased government regulation is inevitably going to result in increased Calgary auto insurance rates, the proposed changes are designed benefit consumers and could actually help keep rates down for longer periods of time. The legislation is known as Bill 39, or the “Enhancing Consumer Protection in Auto Insurance Act.”
Auto Insurance Calgary: Bill 39 and How it Will Affect Your Rates
According to Doug Homer, the president of the Treasury Board and the province’s Finance Minister, Bill 39 is being tabled in response to requests from the people of Alberta to make changes in the insurance industry. It contains two major provisions: first, it would increase regulation of the mandatory premiums all drivers are required to carry. More importantly, Bill 39 would also give the provincial government the authority to regulate optional premiums that consumers aren’t required to carry, but may want to purchase to better protect themselves. Currently, only mandatory premiums are regulated by the government, and as such, many insurance companies charge very high rates for optional forms of coverage as a means of generating increased profits.
Examples of optional forms of auto insurance include:
- Additional liability coverage. In Alberta, you are required to carry at least $200,000 in liability coverage in case someone sues you as the result of an accident in which you were at fault. However, you can purchase up to $5 million in liability coverage, and many do, since you are on the hook for the difference if someone wins a judgment against you for an amount that exceeds your liability coverage.
- “All perils” coverage. Also known as comprehensive coverage, all perils coverage essentially guarantees that your vehicle is protected no matter what happens to it. Standard insurance policies usually only cover damage resulting from collisions.
- Accident benefits. With accident benefits coverage, you and all the passengers in your vehicle are eligible for benefits in the event that they suffer injuries in an accident, regardless of who is at fault. These benefits cover things like lost wages, medical expenses and death benefits if the crash resulted in loss of life.
Obviously, carrying this type of auto insurance in Calgary can be majorly beneficial, but with the way the insurance industry is currently set up, these types of coverage sometimes can’t be considered by people. Bill 39 would change that.
Auto Insurance Calgary: Rate Increase Applications
Another significant change that’s on the way is that the provincial government may allow individual insurance companies to submit applications if they want to increase rates. The government would assess whether or not the insurance company is justified in proposing the rate increase, and would have the power to annul the proposed increase.
Two other changes are in store. First, the province plans to ensure that Alberta residents have better access to health care following an accident. It also plans for make insurance companies subject to stricter solvency requirements.
Auto Insurance Calgary: Do You Have Questions?
If you have any questions about the changes contained in Bill 39, or if you have any other concerns about your auto insurance, don’t hesitate to call on Lane’s Insurance for friendly advice. Lane’s Insurance is a leading Calgary-based insurance brokerage, providing customers with access to comprehensive insurance products at highly competitive rates, with the added benefit of attentive, personalized customer service and claims support. For a fast, free quote, visit Lane’s Insurance online or contact Lane’s Insurance via email or phone.
