Alberta extends good driver rate cap into 2026 as new insurance model looms

EDMONTON — Alberta will keep its cap on auto insurance rate hikes for drivers with clean records through 2026 as it prepares to roll out a new “care-first” insurance system in 2027.

The province says drivers who qualify as good drivers will continue to face a maximum premium increase of 7.5 per cent when renewing policies next year. The cap includes a general five per cent ceiling plus an additional 2.5 per cent to help insurers manage costs tied to natural disasters, such as this year’s hailstorms in Calgary and Brooks.

“Albertans deserve an auto insurance system that works for them,” Finance Minister Nate Horner said in a statement. “By keeping the rate cap in place this year, good drivers avoid higher costs and keep more money where it belongs — in their pockets.”

To be eligible in 2026, motorists must meet stricter criteria, including no at-fault accidents in the past six years, no Criminal Code traffic convictions in the past four years, and no major or minor traffic convictions in the past three years.

The Automobile Insurance Rate Board will also be restricted from approving increases above an average of 12.5 per cent across all policyholders, up from the previous 10 per cent. The government says the measure is intended to keep overall costs in check.

Earlier this year, the legislature passed the Automobile Insurance Act, which lays out the framework for the new care-first model. The system is set to launch in January 2027 and is aimed at stabilizing premiums while providing what the province calls “the best benefits in Canada” for people injured in collisions.

Alberta says it will continue working with insurers, brokers and health-care providers to ensure a smooth transition.