Alberta Regulation 150/2023, also known as the Automobile Insurance Premiums Amendment Regulation, was filed on December 18, 2023, under the authority of the Lieutenant Governor in Council and in accordance with specific sections of the Insurance Act. This regulation amends the existing Automobile Insurance Premiums Regulation (AR 117/2014) to introduce several changes regarding automobile insurance premiums in Alberta.

One of the amendments is the expansion of the definition of a “premium payment plan” in Section 1. Prior to January 1, 2025, policyholders can pay their annual automobile insurance premiums in installments throughout the term of the insurance contract. Beginning January 1, 2025, the regulation mandates that policyholders make an initial payment equal to two monthly installments, followed by either equal monthly payments or a full payment spread over 12 months. Additionally, a new section, 5.1, empowers the Insurance Board to order insurers to file changes to their rating programs. This requirement can be invoked due to legislative changes, market fluctuations, or shifts in the operating environment since the last filing. Insurers must comply with this order within 60 days of receiving notice, facing potential penalties for non-compliance.

The regulation also revises existing sections. Specifically, Section 6 is updated to reference the new section 5.1, while Section 8(2) alters the terminology from “serious” to “major or minor” in relation to the classification of certain incidents. Furthermore, a new provision (9.1) requires insurers to return any excess premiums collected beyond a specified profitability target to policyholders. This measure aims to improve fairness in premium pricing, ensuring that consumers benefit from any insurer profitability that exceeds established thresholds.

Section 9.2 mandates that insurers provide premium payment plans for policyholders renewing or entering into contracts for private passenger vehicles, with exemptions based on specific conditions, such as prior cancellations for non-payment, insurance of non-private passenger vehicles, or low annual premiums. Insurers are also required to charge all policyholders a uniform rate or fee for these plans. The regulation further amends the Insurance Enforcement and Administration Regulation (AR 101/2022) to include references to the new section 5.1 and the premium payment plans, ensuring consistency across related regulations.

By mandating premium payment plans and ensuring the fair return of excess premiums, the regulation aims to enhance consumer protection while promoting transparency and fairness in the insurance market. As these changes take effect, both policyholders and insurers will need to adapt to the evolving landscape of automobile insurance in the province.

Alberta (150/2023) January 15, 2024