Bell: Alberta drivers will save up to $366 next year on auto insurance — we hope |
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Bell: Alberta drivers will save up to $366 next year on auto insurance — we hope
Albertans are promised savings on auto insurance premiums next year. Don't book the trip to Vegas yet.
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The Alberta government has happy news, good news, break out a bottle of the best to celebrate news.
Bell: Alberta drivers will save up to $366 next year on auto insurance — we hope Back to video
They roll out a report, an independent report.
On Friday, the report proclaims starting next year good drivers in Alberta could see yearly savings of up to $366 per vehicle on auto insurance.
You see, the UCP government of Premier Danielle Smith is “moving away from a court-based insurance system” to a system where they lay out the benefits Albertans will receive in the event of a collision.
The Alberta government says they are putting forward a great benefit package for medical care, rehab and income support without having to go to court and sue.
The auto insurers are happy.
They do point out if you have more than basic auto insurance, in other words if you have collision insurance, the full coverage as many people do, they peg the savings on premiums at more like $260 a year.
It’s still a chunk of change.
And the provincial government mentions if they had not put any cap on how much good drivers could be charged for auto insurance, the average cost of full auto insurance coverage could have been more than $3,100 by next year.
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Under the new Alberta system coming in Jan. 1 of next year, the average cost of auto insurance is going to be around $2,000 a policy.
Still, if there is one story where not counting your chickens before they hatch fits like a well-tailored suit, it is this one.
Why aren’t we counting the chickens before we see them?
Because we’re talking about auto insurance in Alberta and, since I’ve done countless stories over many years on the subject, loyal readers know what I’ll say next.
I do not have a high opinion of auto insurance companies and I have spoken several times with Premier Smith about reining in these outfits and doing something about the high auto insurance premiums in this province.
She agreed something needed to be done. Pardon me if I wait and see.
Nate Horner is Smith’s budget boss and rides herd on the insurance file.
He is encouraged by the potential savings. He promises to work harder to keep the insurance crowd accountable.
But how can we ensure Alberta’s good drivers will get these savings? Asking for millions of Albertans.
Horner says they’ve built accountability into the system.
The Automobile Insurance Rate Board, also not my favourite crew, will make insurers base their premiums on “independent actuarial benchmarks.”
The rate board will not approve rates that don’t align, says Horner.
Premiums will need to be justified and reflect the lower costs of the new system where lawyers have largely gotten the heave-ho.
Horner insists the savings are not based on promises. This system, he says, is “based on real world costs.”
The work was “publicly reviewed and tested before being finalized.”
Again, Horner pledges to make sure the savings are passed on to Albertans,
How does Horner respond to the critics who are skeptical of all this good news talk and who say these savings on premiums are unlikely? Asking for millions of Albertans.
The numbers, like the $366 a year in savings on basic auto insurance coverage, are not based on government estimates. They are based on independent number crunching.
Horner also says the auto insurance rate board will protect consumers. This I’ve got to see.
“We’re also not starting from scratch. Similar insurance systems in B.C. and Manitoba have delivered savings while improving care,” says Horner.
“The evidence is clear and it supports exactly what we’re doing.”
But B.C. and Manitoba have public auto insurance. Why not go that route?
Horner says Albertans have been clear. /They don’t want a “government-run system.”
As he has said before, a public system would cost as much as $3 billion to set up and would put the government on the hook for claims.
He also mentions the loss of private sector jobs, though there would have to be a whole lot of folks hired to work in the public system.
Horner concludes by saying Alberta is on “the better path” because it’s delivering real change “without massive risk or disruption.”
The proof, of course, will be in the pudding.
And 2027 is a big year: a provincial election is expected in the fall of next year and the auto insurance companies will not be on the ballot.
What you need to know about Alberta's move to no-fault auto insurance
Red tape makes Alberta auto insurers slow to respond to risk: Report
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