Types of insurance coverage in Alberta
While shopping around for insurance coverage, it is important to understand what types of coverage are available.
Before deciding on a policy, it is important that you consider carefully how much you’re willing to risk having to spend to repair or replace your vehicle should an incident occur. It will likely be worth it to pay a higher premium now in order to save down the road.
This can be added to your basic insurance policy in order to protect yourself from a financial burden resulting from a collision with another object. Collision coverage will pay for any damage involved.
Comprehensive collision can also be added to your basic insurance policy and pays damage caused by many events that are out of your control such as theft, weather, vandalism, or otherwise. Comprehensive insurance covers you against all insurable perils, with the exception of damage from a collision.
This type of coverage will pay for losses resulting from requested perils
This will offer you the highest coverage. Combining collision and comprehensive insurance.
How are your car insurance premiums determined in Alberta?
Your address will help determine your premiums. Those who live in a bigger city like Calgary or Edmonton where roads are more congested can expect to pay more than those in a more rural area like Cochrane.
The lack of experience in young drivers translates to higher premiums. Once you gain more experience and are at a lower risk of being in an accident, your rates should go down as long as you keep a clean driving record.
In Alberta, it pays to have a good driving record. Every year of clean driving can save you 5% off the grid rates, up to a maximum of 50%.
This is not the case if you are involved in an at-fault accident, which stays on your record for six years. This type of accident will result in high premiums. Unlike those with a clean record, each at-fault accident moves a driver five steps up the grid. As little as one at-fault accident can result in a 50% rate increase on average.
The vehicle you drive will impact your premium, mostly due to the cost of repair and replacement parts. Generally speaking, the fancier the car, the more expensive your insurance will be.
The more you drive, the higher your premium will be.
Your premium will rely on the deductible and amount of coverage you choose. Generally speaking, a higher deductible will mean a lower monthly payment.
How can you get the cheapest car insurance rates in Alberta?
- Shop around for the best quote: With so many factors contributing to your insurance rates, it is important to do prior research to determine where you can find the best value. As there are so many car insurance companies to choose from, make sure to collect and compare multiple quotes before making your decision.
- Keep a clean driving record: Insurance companies will reward you for being a safe driver. Following the rules of the road and driving according to road conditions won’t only lower your chance of being in an accident but it will also save you money. Car crashes stay on your insurance record for up to ten years and often result in higher premiums.
- Increase your deductibles: Increasing your deductibles from $500 – $1,000 is a great way to save 5 – 10% per month. Make sure you can afford the increased deductible in the event of an accident.
- Take a driving course: If you’re a new driver, it is recommended to take a driver’s education course for various reasons. Not only will you be a better driver but your insurance provider will also offer you a lower premium as a result. You will be deemed a safer driver if you’ve been trained by professionals.
- Bundle vehicles: If your household consists of multiple drivers and vehicles, it will be most cost effective to put them all on one policy.
- Bundle home & auto insurance policies: When you use the same insurance company for both your home and auto insurance policies, you will receive a lower premium as a thank you from your provider. Insurance companies like to reward their loyal customers.
- Look out for discounts: There are many discounts available whether you belong to a large corporation, you’re a school alumnus, in the military, and otherwise. You can also be rewarded with cheaper rates for having optional accessories such as winter tires or anti theft devices. Insurance companies will see these as being risk averse.
Alberta car insurance rates compared
- British Columbia – $1,680
- Ontario – $1,445
- Alberta – $1,251
- Newfoundland & Labrador – $1,132
- Manitoba – $1,080
- Northwest Territories – $978
- Nunavut – $963
- Saskatchewan – $936
- Nova Scotia – $842
- New Brunswick – $819
- Yukon – $812
- Prince Edward Island – $796
- Quebec – $661
Frequently asked questions
Is car insurance mandatory in Alberta?
Just like the rest of Canada, it is required that all drivers in Alberta have car insurance. It is mandatory to have a minimum of $200,000 in third-party liability, as well as Accident Benefits (no-fault benefits) insurance, which covers costs that exceed provincial health care should the driver be injured in a crash. There are serious fines for those who drive without the proper insurance.
How much is the average insurance cost in Alberta?
Alberta is in the top three most expensive provinces, with an average cost of $1,316 per year. Ahead of Alberta is Ontario and British Columbia, with average annual costs of $1,505 and $1,832 respectively.
Keep in mind that these are simply averages and that your personal premium will be unique based on your driving profile.
Do I need insurance if I’m an Uber driver or I drive for another ride-sharing service in Alberta?
Yes, like all drivers in Canada, you will be required to have insurance. In Alberta, there is provincially-approved ride-sharing insurance available, both as an addition to personal policies and also as a safety net for Transportation Network Companies (TNCs). With this in place, drivers for Uber and other ride-sharing companies such as Lyft will have the proper coverage and have peace of mind when on the road.
How do I choose the right coverage?
It’s important to think of the bigger picture when deciding on how much coverage you want to get out of your car insurance policy. While all drivers in Alberta are required to have a minimum of $200,000 in third-party liability as well as Accident Benefits insurance, some drivers prefer to get additional coverage for peace of mind. Although $200,00 may look like a large number, the potential of having to pay a higher amount out of pocket should an accident occur remains. In order to avoid a major financial burden down the road, it is recommended that you consider additional coverage such as collision, comprehensive, named perils, or perils coverage.