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Compare the best auto insurance quotes in Alberta.
It’s not cheap to be a driver in Alberta.
In fact, according to the Insurance Bureau of Canada (IBC) 2023 data, the average premium in Alberta is $1,670, up from $1,136 in 2018. In a climate of rising rates, it pays to compare auto insurance quotes – literally.
By comparing the Alberta auto insurance market, LowestRates.ca finds the best auto insurance policy at the right price for you. All you have to do is enter your postal code, and LowestRates.ca will do all the work to find the lowest auto insurance rates in Alberta for you.
Not quite there yet? Keep reading to learn more about how to get car insurance in Alberta – and at the best price.
Different types of auto insurance in Alberta.
In Alberta, there are mandatory and optional auto insurance coverages that provide drivers with protection, while also offering the flexibility to customize their coverage to their needs. Here’s a brief breakdown of both mandatory and optional coverages, as well as endorsements available to Alberta drivers.
Mandatory car insurance coverage
Alberta’s insurance system requires that drivers carry a minimum of $200,000 in third-party liability insurance for their vehicles. A basic insurance policy in Alberta also includes coverage for the cost of medical care and the cost of repairing your vehicle.
Third-party liability: When you’re deemed at fault for a collision that results in personal or property damage to others, third-party liability covers you.
Accident benefits: Covers the cost of medical care for you and your passengers. It includes rehabilitation costs, funeral expenses, death benefits, and income replacement.
Direct Compensation Property Damage (DCPD): An insurance coverage that helps cover the cost of repairing or replacing your vehicle if you’re not at fault in a collision. You receive the benefit if you were not at fault for causing the accident.
Optional car insurance coverage
These coverages are not mandatory, but they provide extra protection for a wider range of risks.
Collision coverage: The costs to repair or replace your car if it’s involved in a collision with an object other than a car is covered by collision coverage. It has a deductible.
Comprehensive coverage: Covers damage to your car caused by insurable perils like theft, vandalism, and fire is handled by comprehensive coverage. It has a deductible.
Specified perils coverage: You can get protection against specific risks of your choosing with specified perils coverage. You must specify which perils you want coverage against. It has a deductible.
Auto insurance endorsements in Alberta
An endorsement are additional coverages or exclusions added to your insurance policy. They are used to tailor your policy to better suit your coverage requirements or specific situation.
Limited Glass (SEF 13D): Drivers in Alberta tend to file more glass damage claims because of severe weather conditions the region faces. This endorsement restricts coverage for glass damage because of frequent past claims, resulting in a lower premium.
Loss of Use (SEF 20): This endorsement provides compensation for a replacement vehicle (or alternative transportation like cab) if your car is damaged in an accident. There is a specified limit, and it will only cover your vehicle if it’s damaged due to a loss specified in your policy.
Legal liability for damage to non-owned automobiles (SEF 27): This endorsement extends the coverage to rental cars. Again, up to a specified limit and subject to conditions specified in your policy.
Accident Rating waiver (SEF 39): This endorsement prevents your premium from increasing after an at-fault accident.
Limited Waiver of Depreciation (SEF 43R): This endorsement will waive the depreciation costs on repair or replacement of a new vehicle.
Family Protection (SEF 44): This endorsement protects you if you or your family members are involved in a collision with an underinsured or uninsured driver.
Factors that determine car insurance rates in Alberta.
Insurance rates in Alberta are set by private insurers but are regulated by the Automobile Insurance Rate Board (AIRB) and the Office of the Superintendent of Insurance. When setting insurance rates, companies take into account several factors, including:
Your age and gender,
Your marital status,
Your physical address,
The make and model of your car,
Your driving record,
Any previous claims,
What the vehicle is used for,
And how much coverage you require.
Alberta’s auto insurance system & its legal requirements
By law, all drivers in Canada are required to have car insurance. However, coverage requirements, how the insurance system works, and who it’s provided by (private or public insurers) differ from province to province.
In Alberta, all drivers are required to hold third-party liability, accident benefits, and DCPD insurance coverage. While collision, comprehensive, and specified perils coverage is optional. Alberta currently has an at-fault based system. This means that if you were involved in a collision – and although you can recover compensation through the accident coverage claim – you can also sue the at-fault driver and their insurance company for additional damages.
In 2022, Alberta implemented mandatory DCPD where drivers claim damages from their own insurers instead of through the at-fault driver’s insurance company. If you may be at-fault or partially at-fault, you can claim from your own collision coverage.
An at-fault collision will stay on your record for six years, and your premiums may increase.
If caught driving without car insurance, Alberta’s Traffic Safety Act stipulates that you are liable to pay a fine starting at $2,875 and going up to $20,000 for the second offense. Driving without insurance will increase your premium the next time you want to purchase a policy and furthermore, if you get into an accident, you will have to potentially shell out thousands of dollars for property and physical damages and repairs.
Alberta’s auto insurance authority and rate regulation
Insurance rates in Alberta are set by private insurers but are regulated by the Automobile Insurance Rate Board (AIRB) and the Office of the Superintendent of Insurance. However, the way in which insurance premiums are calculated is unique to the province – in that insurance providers use a Grid system to determine rates. The Grid system is a government-mandated framework designed to cap the maximum premium that drivers pay. It takes into account your driving history and your claims history.
Here's how insurance companies use the Grid system to determine your rates:
When calculating insurance, companies have to compare their premium with the Grid. They must charge the lesser of the two premiums.
This rule doesn't apply if you’ve had a driving or criminal conviction within the last three years, three or more at-fault claims within the last six years or you’ve been convicted of insurance fraud.
Premiums for drivers who remain claims-free and free of traffic tickets will decrease over time.
For each year without an at-fault claim, premiums can decrease by anywhere between 5% to 50%.
Inexperienced drivers who have completed a driver’s education course start 10% below the maximum entry-level premium.
Each at-fault claim moves the driver up five rungs on the Grid. It also results in extra surcharges (the same applies if you have a driving conviction).
Car insurance companies in Alberta must apply to AIRB for permission to raise rates across the board.
While the Grid was designed to ensure affordability of auto insurance, over the years, good drivers are finding that they are paying more to subsidize premiums for bad drivers. In 2021, drivers paid an average of $65 to subsidize bad drivers. Consequently, the provincial government has made changes to the system. In 2024, AIRB introduced the Good Driver Protection plan, which prevents companies from raising the rates of policyholders beyond the Alberta’s inflation rate if they meet the definition of a “good driver.” There are also proposals to increase AIRB's oversight around premium increases in the future.
How do Alberta car insurance rates compare to other provinces?
Alberta auto insurance premiums are among the highest in Canada.
Compare the average Alberta insurance rate to other provinces:
Province | Average annual rate |
---|
Ontario | $1,824 |
British Columbia | $1,461 |
Alberta | $1,670 |
Newfoundland & Labrador | $1,329 |
Manitoba | $1,193 |
Northwest Territories | $1,0871 |
Nunavut | $1,093 2 |
Province | Average annual rate |
---|
Yukon | $912 2 |
Nova Scotia | $1,251 |
Saskatchewan | $1,347 |
New Brunswick | $1,177 |
Prince Edward Island | $993 |
Quebec | $1,043 |
Insurance Bureau of Canada, 2023
1Groupement des assureurs automobiles (GAA), 2021
2Groupement des assureurs automobiles (GAA), 2022
Alberta car insurance considerations by demographic
As previously mentioned, your insurance rate depends on a number of factors, including your age, driving experience, and record. Here are some ways in which insurance rates might differ for different demographic groups, and the reason behind it.
Alberta car insurance for seniors
While insurance premiums typically decrease as drivers gain experience, rates begin to rise slightly after the age of 70 due to the perceived increase in risk. However, there are still opportunities for seniors to save on insurance costs. Membership in professional associations like the Canadian Association for Retired Persons (CARP) can unlock special discounts, and opting for usage-based insurance is another way to reduce premiums, especially if driving frequency decreases in retirement. Additionally, many insurers, such as Intact Insurance, offer discounted rates for seniors.
Alberta car insurance for new immigrants
Car insurance premiums for new immigrants are often high initially, as they lack experience navigating Canadian roads and driving conditions. Exceptions exist for some countries – like the United States where driving experience is comparable to Canada or the United Kingdom that has a licence exchange agreement with Canada – thus allowing for lower premiums. For most newcomers, however, going through the Alberta licencing process is necessary. And premiums will gradually decrease as you gain driving experience in Alberta. To help reduce insurance costs, newcomers can consider bundling their home and auto insurance with the same provider to take advantage of potential savings.
Alberta car insurance for students
As a student or young driver, auto insurance in Alberta tends to be expensive as you do not have substantial driving experience. Once you reach the age of 25, rates start declining as there is now, a demonstrated driving history or record. One way for students or young drivers to reduce their premiums is being listed on their parents’ auto insurance policy. Not only is it more affordable to be a secondary driver, but it also allows you to build driving history, which can help secure better rates when you’re ready to purchase your own auto insurance policy.
Alberta car insurance for high-risk drivers
Drivers who have a history of traffic violations or driving convictions are classified as high-risk. Auto insurance rates for high-risk drivers generally means higher premiums and limited options for insurance providers who are willing to insure you. High-risk Albertan drivers can obtain coverage through the Facility Association that provides coverage (and thus, higher premiums) when one cannot obtain insurance with standard auto insurance providers. High-risk drivers can work to improve their driving record and reduce premiums over time.
How to get the cheapest auto insurance quotes in Ontario.
It's easy — if you know how. Here are some of the best ways to lower your auto insurance premiums:
Shop around
We'll show you the most competitive rates from all the top insurers. Now you can compare quotes all in one place.
Buy the right coverage
Avoiding extra frills in your policy and paying for only the coverage you need will lower your premiums.
Drive responsibly
Your driving record impacts your rate. Fewer infractions and fines equals cheaper insurance.
Pay on time
Prompt payments can save you money on late fees and lower your premiums. Insurers love a good customer.
Bundle up
Bundling a house, motorcycle, RV, or other type of insurance policy to your car insurance plan can lower your rates.
Be safe, not sorry
Safety features like winter tires and alarm systems can help reduce your insurance premium.
Stick with one insurer
Most auto insurance companies give loyalty discounts to customers who stay with them for a number of years.
Take a course
A defensive driving course makes you a better driver and can significantly reduce your car insurance premiums.
Keep driving
The math is clear: more experience on the road equals lower car insurance premiums. Young drivers almost universally pay higher rates for car insurance. While it’s difficult for new drivers to secure cheap car insurance rates, you may be able to lower your rates by maintaining good gradepecials and attending driving school.
Look at location
Where you drive affects your premiums. Some postal codes are associated with higher rates of car accidents and theft.
Trends in Alberta car insurance rates
Auto insurance rates in Alberta are administered by private insurance companies but are regulated by the AIRB. Traditionally, Alberta has high auto insurance rates. The government and regulatory authority have tried to curtail insurance rates through a mandatory direct compensation property damage (DCPD) coverage in 2022 and a temporary rate freeze in 2023.
Alberta brought on DCPD to stabilize auto insurance premiums
Alberta introduced DCPD coverage with the intent of creating a more efficient way to resolve auto insurance claims and to better align premiums with the actual costs of vehicle repairs. With DCPD coverage, your insurer covers damage to your vehicle when you’re not at fault in an accident, rather than having to claim damages from the at-fault drivers’ insurance. If you’re in a collision and not at fault, your insurance rate is not impacted by the claim. This simplifies the claims process and creates a more transparent system where your premiums are directly tied to your driving record and vehicle, rather than the actions of other drivers.
Alberta introduced a temporary rate freeze to curtail runaway car insurance prices
The Alberta-wide rate freeze was in place for all of 2023 and was intended to provide temporary relief to drivers facing higher premiums because of inflation and increased claims costs. Despite these regulations, the insurance market in Alberta continues to see increased rates. In fact, there had been a 5.24% increase in auto insurance premiums in Alberta during the rate pause.
Other trends driving car insurance rate hikes
Let’s look at some trends that are impacting auto insurance.
Inflation impacts every aspect of an insurer’s business, from claims costs to vehicle repairs. As inflation drives up expenses, insurance companies adjust their premiums to account for these rising costs.
Bodily injury claims are significantly affecting insurance premiums in Alberta – having increased by 79% in 2022 compared to ten years prior, according to a 2024 IBC report – and are expected to only grow in the coming years.
The cost of vehicle parts and repairs has increased 15% over the past two years as a result of inflation and global supply chain issues, according to the same IBC report. Repair time has also increased because of part supply and labour shortages, and increased complexity of repairs.
Car thefts are an ever-present concern for insurers andthe IBC estimates that the average cost of a stolen vehicle claim in Canada is over $9,000. Auto theft claims in Alberta rose by 55% from 2023 to 2021. Alberta consistently ranks as one of the provinces with the highest rates of auto theft, and insurers pass on the cost of auto theft to consumers by increasing premiums.
Car insurance in Alberta: What you need to know
What kind of auto insurance system does Alberta have?
What kind of auto insurance system does Alberta have? In Alberta, auto insurance is mandatory and includes third-party liability for injuries, accident benefits, and DCPD. Currently, a not-at-fault driver can sue the at-fault driver and their insurance company for damages. The Alberta government has singled out legal disputes as one of the main things adding strain to the system, causing high premiums in return. The provincial government is exploring solutions to address these challenges, including a pure no-fault system (where the option to sue is heavily restricted), a hybrid system (where drivers can choose whether they want coverage to sue the at-fault party), and a fully public, government-delivered auto insurance system.
How much is car insurance in Alberta?
The cost of car insurance in Alberta can vary because car insurance is such a customized product. Automobile insurance rates in Alberta can depend on a variety of factors — some which are in your control and others that aren’t. That’s why the best way to make sure you get a reliable estimate for car insurance in Alberta is to compare the Alberta auto insurance market online.
Car insurance calculators geared for Alberta drivers require less information, but this also makes them less accurate. With our help, you can find an affordable car insurance rate in Alberta in under five minutes that saves you hundreds on car insurance each year. Enter your postal code to start the form and LowestRates.ca will connect you with an Alberta car insurance broker in your area.
How do I get car insurance in Alberta?
There are several ways drivers in Alberta can obtain a car insurance policy. One of the most common ways is to go directly to a private insurance company and apply for a policy. Many drivers also use an insurance broker, which is a company that works with and sells policies from multiple different insurance providers. A broker may have a deeper knowledge of Alberta’s car insurance market as a whole.
The best way to secure the best car insurance rates in Alberta is to compare the market before signing up for any policy. LowestRates.ca can help you with that.
Which insurance company has the cheapest rates in Alberta?
There isn’t a car insurance company in Alberta that offers cheap insurance to all its customers. Car insurance companies base their premiums on a lot of factors. These include underwriting standards, losses, the wider economy, and also your individual driving habits.
That’s why we emphasize shopping around before locking into an insurance policy.
There’s a strong chance that another car insurance company can offer you a better rate than the one you’re with right now.
Your lowest and highest quote can vary by hundreds of dollars. It’s pretty eye-opening. Try comparing quotes for free.
Do Alberta car insurance companies check your credit score?
In Alberta, it is legal for a car insurance company to use your credit score to set your premium. But they can’t do it without your consent. You can decline to let an insurance company see your credit score.
Ontario and Newfoundland and Labrador bars car insurance companies from using credit score data.
What are the penalties for driving without insurance in Alberta?
If you're convicted of driving without insurance in Alberta, you'll have to pay a fine ranging from $2,500 to $10,000 for your first offence, plus a 15% fine surcharge. Second offence fines range from $5,000 to $20,000, plus a 15% surcharge. Repeat offenders could also face up to 60 days of jail time and a licence suspension if convicted.
Once you're convicted of driving without the minimum auto insurance coverage, you'll be identified as high risk, and you may face higher auto insurance rates in the future.
What's the minimum legal driving age in Alberta?
In Alberta, you can begin the licensing process when you turn 14.
To get a learner's licence in Alberta, you must pass a written rules-of-the-road knowledge test and a vision test. Once you pass, you'll be issued a licence, but you must be accompanied by a fully licensed driver who is 18 or older. Of course, as a learner, you can only operate your vehicle while maintaining a 0.0 blood alcohol concentration (BAC).
How do I get a probationary licence in Alberta?
First, you must be 16 or older and have held your learner's licence for at least 1 year. Then you have to pass the Alberta Class 5 road test
How do I get a full licence in Alberta?
After holding the probationary licence for two years, you must pass an advanced road test. Once you pass, you’ll get your Graduate Driver's Licence.
How does not having a full Alberta licence impact my auto insurance rate?
Inexperienced drivers pay higher than average car insurance premiums.
We recommend that teenagers get added as secondary drivers on their parents' auto insurance policy. Start building up their driving record — the longer they have a record (that’s clear of claims or convictions), the cheaper their insurance will be when they apply for their own policy.
Young drivers pay a lot for insurance in Alberta, but they also can find the most savings by comparing car insurance quotes.
Is ride-sharing insurance available in Alberta?
Yes. Provincially approved ride-sharing insurance is available in Alberta, both as an extension of personal policies and as a blanket policy for Transportation Network Companies (TNCs). That means drivers for Uber and other ride-sharing companies can get the right coverage and stay protected on the road.
Is usage-based insurance available in Alberta?
Yes. In 2016, Alberta was the first Western province to introduce usage-based insurance (UBI) policies. Now local drivers can lower their insurance premiums by opting into a UBI plan and driving responsibly.
Alexandra Bosanac
About the Author
Alexandra Bosanac is the Core Content Manager for LowestRates.ca. Her reporting has appeared in Canadian Business, the Toronto Star, the National Post, and the CBC.
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