New and improved benefits under Alberta’s Care-First auto reforms

Alberta’s Care-First auto insurance reforms coming into effect in less than a year will provide a variety of new and improved benefits to claimants, including unlimited access to treatment, such as chiropractic, physiotherapist or psychologist care, if needed, the provincial government says.

On Friday, the Alberta Auto Insurance Rate Board released an independent report prepared by Oliver Wyman examining projected claims costs under the system, which will come into effect Jan. 1, 2027.

“The report shows that moving away from a court-based insurance system will reduce overall costs and improve stability for consumers,” the government says. “For Albertans with basic coverage, average savings are expected to reach up to $366 per vehicle per year under the new Care-First system.”

Insurance Bureau of Canada (IBC) welcomes the report, with Aaron Sutherland, IBC’s vice president for the Pacific and Western regions, saying in a press release, “the Alberta government deserves tremendous credit for designing and delivering a best-in-class auto insurance system.

“By taking action to reduce legal costs, these reforms will put money back into the pockets of drivers while also providing the most generous care and benefits in the country to anyone injured in a collision,” Sutherland says.

Unlimited medical, rehab benefits

Under a standard Care-First auto insurance policy, medical and rehabilitation benefits will be “unlimited for all reasonable and necessary expenses, until maximum medical recovery (and potentially for life),” says the government’s list of benefits. This compares to the current system of $50,000 for up to two years following an accident, with limits on specific benefits.

The reforms also include personal care assistance for catastrophic injuries at $6,781/month and $5,671/month for non-catastrophic injuries. There will be reimbursement for travel and accommodation expenses “in accordance with guidelines.” Personal care assistance and travel/accommodation coverage are not applicable in the current system.

When it comes income replacement benefits (IRB), Care-First will cover 90% of net income, up to a maximum annual gross income of $125,000. This compares to the current lesser of $600 per week ($31,200 a year) and 80% average gross weekly earnings for a maximum of two years following an accident.

The auto reforms include a variety of new additional accident benefits that are not in the current system:

• IRB lump sum indemnity for each school year not completed by a minor or student
• Caregiver weekly indemnity (IRB)
• Childcare expense reimbursement (IRB)
• Permanent impairment benefit – lump sum payment of $298,520 for catastrophic injuries and $944 (minimum) to $189,055 (maximum) for non-catastrophic injuries
• Other expenses such as meal allowance, critical care attendance and clothing allowance.

Funeral benefits have also increased to a maximum of $10,308, up from $6,150. So have death benefits to spouses and dependants. Grief counselling is set at a maximum of $4,310 per person, compared to $500 per family previously.

Right to sue

Benefits under Care-First can begin within weeks versus months or years, the government says. Currently, not-at-fault drivers can sue in most circumstances, except for narrowly defined minor injuries.

Care First will eliminate the right to sue in most cases, although people can still sue if an at-fault driver is found guilty of certain serious offences, such as dangerous operation of a vehicle, drunk driving or fleeing law enforcement.

The auto reforms also introduce a tribunal, where Albertans can dispute benefit decision. But the Alberta Civil Trial Lawyers Association (ACTLA) questions the dispute handling process, saying in a release “the costing assumes disputes will be resolved efficiently and at low cost without fully accounting for how a no-fault system administered by private insurers operates in practice.”

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ACTLA says it is particularly concerned that the costing in Oliver Wyman’s final report relies heavily on Manitoba’s public insurance experience as a benchmark. Most disputes in Manitoba are resolved internally before they ever reach an appeal body, the association says.

“Manitoba’s low appeal numbers are not the result of no-fault alone,” says ACTLA chair Laura Comfort. “They are the product of a tightly controlled public system that resolves disputes upstream. You cannot assume those outcomes will repeat in a private system where insurers, not the public, control claims decisions.”

Alberta’s government previously said the new model will help stabilize premiums when implemented. But ACTLA says it is concerned about premium underpricing.

“If premiums are set too low at launch, pressure will mount to control costs through stricter benefit interpretations, longer delays, or procedural barriers that make it harder for injured people to challenge decisions,” the association says. “When that happens, disputes do not disappear — they become harder, slower, and less fair to resolve.”

Jason Contant

Jason has been an award-winning journalist with Canadian Underwriter for more than a decade, including the past three years as associate editor and, before that, as digital editor for seven years.