Alberta’s introduction of a cap on the cost of liability-only vehicle insurance has insurance companies mitigating their financial risk by increasing other rates and pricing some drivers out of coverage.
“The government meant well,” explained Lance Miller, CEO of Surex Insurance. “They’re trying to protect Albertans from high increasing costs in insurance. The problem was the stance they took has created an environment that is endangering Albertans.”
The insurance industry says some Albertans could end up without car insurance and some companies may pull out of the province because of the NDP government’s cap on premium increases.
But the province says it’s working to protect consumers while also ensuring a healthy insurance industry.
Last December, Finance Minister Joe Ceci issued an order limiting cumulative auto rate hikes to five per cent, citing concerns over the effect of hefty rate increases on Albertans, with the policy set to be in place until the end of November.