Alberta is reviewing auto insurance in the province to ensure that the industry can remain viable and drivers can get affordable coverage.
Finance Minister Travis Toews says Albertans are paying some of the highest rates in Canada but are having trouble getting critical protection such as comprehensive and collision coverage.
But a five per cent annual cap on rate increases, introduced by the former NDP government and abandoned by his United Conservatives, is not coming back, he says.
“The rate cap simply put a Band-Aid on a wound that was festering,” Toews said at the legislature Wednesday.
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“In the intermediate and long term it was no solution, and even in the short term it made a bad situation worse.”
Auto insurance rates in Alberta have been rising sharply in the last five years. It trend prompted the NDP government to cap global rate increases at five per cent annually for each insurer starting in 2017.
Albertans brace for double-digit auto insurance rate hikes
The new UCP government did not renew the cap in August, and some drivers have since reported getting notices of steep rises in rates of 12 per cent or more.
Insurers have said that under the cap they were losing money in Alberta, given more payouts for car theft, injury claims, repairs and catastrophes such as the 2016 Fort McMurray wildfire.
Toews said the cap forced insurers to seek savings at the expense of drivers by, in some cases, refusing to offer critical protections.
In other cases, individual clients were still hit with steep increases as long as the overall hike by the insurer to all Alberta clients remained at five per cent.
Fears mount as more auto insurers raise rates in Alberta
“Under the cap, we had insurers getting squeezed … so Albertans were finding themselves with fewer and fewer insurance options,” said Toews.
“We ultimately need to deal with the challenges that are leading to increased premiums … and present a reformed insurance system in this province that can serve Albertans well.”
A three-member committee headed by Chris Daniels has been asked to research and recommend solutions that work for all parties within the existing privately delivered system.
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The committee is to report back in the spring. Toews said the government will take action as soon as possible after that.
LISTEN: Finance Minister Travis Toews joins Rob Breakenridge to discuss the advisory panel tasked with assessing Alberta’s auto insurance industry
Daniels, consumer representative on the Automobile Insurance Rate Board, said there is no single reason for rising costs, although technology has made what used to be minor damage no longer minor.
“The new cars have a tremendous amount of technology,” said Daniels.
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“A lot of the sensors of those new technologies are located in the windshield, so you have a windshield replacement that used to cost maybe $300 is now costing $1,500.”
The Insurance Bureau of Canada said it welcomes the review, particularly as it relates to injury claims.
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“Increases in payouts for minor injuries have led the average claim size to increase by nearly 10 per cent per year,” bureau vice-president Celyeste Power said in a statement.
“Alberta’s three million drivers have said they want more affordable premiums, more choice, and care they can count on when they need it.”
TORONTO – Restaurant Brands International Inc. reported net income of US$357 million for its third quarter, down from US$364 million in the same quarter last year.
The company, which keeps its books in U.S. dollars, says its profit amounted to 79 cents US per diluted share for the quarter ended Sept. 30 compared with 79 cents US per diluted share a year earlier.
Revenue for the parent company of Tim Hortons, Burger King, Popeyes and Firehouse Subs, totalled US$2.29 billion, up from US$1.84 billion in the same quarter last year.
Consolidated comparable sales were up 0.3 per cent.
On an adjusted basis, Restaurant Brands says it earned 93 cents US per diluted share in its latest quarter, up from an adjusted profit of 90 cents US per diluted share a year earlier.
The average analyst estimate had been for a profit of 95 cents US per share, according to LSEG Data & Analytics.
This report by The Canadian Press was first published Nov. 5, 2024.
ST. JOHN’S, N.L. – Fortis Inc. reported a third-quarter profit of $420 million, up from $394 million in the same quarter last year.
The electric and gas utility says the profit amounted to 85 cents per share for the quarter ended Sept. 30, up from 81 cents per share a year earlier.
Fortis says the increase was driven by rate base growth across its utilities, and strong earnings in Arizona largely reflecting new customer rates at Tucson Electric Power.
Revenue in the quarter totalled $2.77 billion, up from $2.72 billion in the same quarter last year.
On an adjusted basis, Fortis says it earned 85 cents per share in its latest quarter, up from an adjusted profit of 84 cents per share in the third quarter of 2023.
The average analyst estimate had been for a profit of 82 cents per share, according to LSEG Data & Analytics.
This report by The Canadian Press was first published Nov. 5, 2024.
TORONTO – Thomson Reuters reported its third-quarter profit fell compared with a year ago as its revenue rose eight per cent.
The company, which keeps its books in U.S. dollars, says it earned US$301 million or 67 cents US per diluted share for the quarter ended Sept. 30. The result compared with a profit of US$367 million or 80 cents US per diluted share in the same quarter a year earlier.
Revenue for the quarter totalled US$1.72 billion, up from US$1.59 billion a year earlier.
In its outlook, Thomson Reuters says it now expects organic revenue growth of 7.0 per cent for its full year, up from earlier expectations for growth of 6.5 per cent.
On an adjusted basis, Thomson Reuters says it earned 80 cents US per share in its latest quarter, down from an adjusted profit of 82 cents US per share in the same quarter last year.
The average analyst estimate had been for a profit of 76 cents US per share, according to LSEG Data & Analytics.
This report by The Canadian Press was first published Nov. 5, 2024.
