Auto Insurance Alberta

Alberta’s three million or so licensed drivers all have to worry about auto insurance, but the different types of available insurance, the variety of providers, and the regional variations in insurance laws can all become a little overwhelming. Auto insurance is a vitally important part of your driving profile though, so it’s critical that you understand the requirements and find the best, most cost-effective insurance solution for you.

We’re here to help you in this endeavour by breaking down everything you need to know about auto insurance in Alberta. This includes some of the best and most trusted insurance providers in the province, shown in the table below.

Best Auto Insurance Companies in Alberta

Business Insurance Online, Home & Auto Insurance
Pricing varies by coverage needs
Alberta, British Columbia and Ontario

Auto Insurance Laws in Alberta

To understand auto insurance in Alberta, let’s start by looking at what the law says:

Who needs auto insurance in Alberta?

Basic auto insurance is a legal requirement for all drivers and vehicle owners in the province - regardless of vehicle details, driver demographics, or the license type you’re driving under. If you are found driving without the proper insurance you will face hefty fines - starting at $2,875 and escalating to $10,000 for a first time offence. Repeat offenders may face fines of $20,000.

What type of auto insurance is mandatory in Alberta?

Alberta requires that all drivers have what is known as “basic” insurance coverage, which is composed of:

  • Third party liability coverage of at least $200,000
  • Accident benefits coverage
  • No fault coverage

Compared to other provinces, this is a fairly small set of requirements, which leaves a lot of room for insurance providers to offer optional coverage extras and to tailor insurance plans.

What additional types of auto insurance can I get in Alberta?

The list of supplemental insurance available throughout Alberta is long, and includes items such as:

  • Increased third party liability coverage
  • Increased accidents benefits coverage
  • Collision coverage
  • Specified perils coverage
  • Rental car coverage
  • Replacement vehicle coverage
  • Comprehensive coverage
  • Specialized vehicle coverage

Each extra level of coverage will make your overall cost of insurance higher, but by combining coverage types and focussing on what you need, you will be able to get the best deal with the right amount of coverage for you.

If you like to research various types of insurance, maybe you'd like to calculate how much a car loan will cost you, check here!

What’s not included in auto insurance coverage in Alberta?

All insurance policies have exclusions, and this includes:

  • Vehicle wear and tear
  • Mechanical failure and breakdowns
  • Tire damage
  • Accidents resulting in a criminal charge

Where can I get auto insurance in Alberta?

Alberta’s auto insurance market is entirely private, and there are 69 different insurance companies licensed in the province.

You can access insurance from one of these providers in several ways:

  • Via an insurance agent
  • Via an insurance broker
  • Via a direct insurance writer
  • Online

The Cost of Auto Insurance in Alberta

Alberta is home to the third most expensive insurance market in Canada; the average policy costs around $120 a month, but this can be higher or lower depending on the driver and vehicle. The rates that insurance providers charge are regulated and capped by the Automobile Insurance Rate Board (AIRB), which utilizes a Grid Rating System.

What’s the Grid Rating System and how does it work?

The Grid Rating System (GRS) is unique in Canada’s insurance industry; it works by calculating the maximum possible rate an insurance company can charge you for basic auto insurance, based on some simple information. This information includes:

  • Driver’s age
  • Location
  • Driving history
  • Vehicle details
  • Vehicle use

Although the GRS can give you a guideline to the maximum amount you’ll pay for mandatory insurance, most Albertan drivers actually pay less than this maximum because of the existence of extenuating factors. However, it is a useful method to stop costs spiralling for inexperienced drivers or those with a poor driving history.

The GRS does not apply to optional insurance - these premiums are set by the insurance companies themselves, which is why it helps to shop around to make sure you’re getting the best deal for you.

How can I lower my auto insurance costs in Alberta?

There are a few ways to qualify for cheaper auto insurance - both for mandatory and optional coverage:

  • Use winter tires
  • Use an anti-theft device
  • Bundle your auto insurance with other forms of insurance
  • Bundle your auto insurance across multiple drivers or vehicles
  • Complete a driver certification
  • Increase your deductible
  • Drive less
  • Move to a safer area
  • Utilize secure parking
  • Ask about company discounts

Frequently Asked Questions About Auto Insurance in Alberta

Do I need auto insurance in Alberta?

Yes! All drivers in Alberta, at all levels, operating any kind of road-certified vehicle, need insurance that meets the province’s minimum required levels.

Who sets the cost of auto insurance in Alberta?

The cost of mandatory auto insurance in Alberta is regulated and capped by the Automobile Insurance Rate Board (AIRB). They set a maximum that insurance companies can charge for basic insurance. The cost of optional auto insurance is set by the insurance companies themselves.

Where can I get auto insurance in Alberta?

Alberta has 69 auto insurance providers, some of which are listed in the table shown above. These are all private companies, and insurance policies can be purchased directly from them, via a broker or agent, or online.

How long does it take to get auto insurance in Alberta?

Getting auto insurance is a very quick process; once you’ve provided your personal details and the car’s information, an insurer can give you an accurate quote in minutes. If you decide to move forward, your coverage can start as soon as the next business day.

Can I be denied auto insurance in Alberta?

No, no driver can be denied auto insurance in Alberta. The only exception to this is that a specific company may refuse to insure you if you have previously failed to pay them premiums.

Which city in Alberta is the most expensive for insurance?

Location can be a big factor in your insurance rates, and those living in Edmonton pay the most of all Albertans for their auto insurance. Banff residents pay the least.

Written By Smarter Loans Staff

The Smarter Loans Staff is made up of writers, researchers, journalists, business leaders and industry experts who carefully research, analyze and produce Canada's highest quality content when it comes to money matters, on behalf of Smarter Loans. While we cannot possibly name every person involved in the process, we collectively credit them as Smarter Loans Writing Staff. Our work has been featured in the Toronto Star, National Post and many other publications. Today, Smarter Loans is recognized in Canada as the go-to destination for financial education, and was named the "GPS of Fintech Lending" by the Toronto Star.