How the most successful insurers, brokers will respond to Alberta auto reform

Under Alberta’s incoming Care-first auto insurance model, which goes into effect on Jan. 1, 2027, insurers and brokers can expect to operate under a “dual system” for a while as the final claims from the old model get closed, says a government official at Dentons 2^nd Annual Insurance Summit in Toronto.  

David Mulyk, executive director of pension and insurance policy at the Government of Alberta, shared provincial insurance regulatory updates during the Monday event, and offered his perspective on how insurers can best prepare for the operational transition. 

“Care-first is the single biggest transformation of auto insurance in the history of the province of Alberta,” Mulyk says. “Certainly, in the conversations that I’ve had with my own minister, they recognize that Day 1 perfection is not the goal; it’s not realistic, it’s not possible, and government is comfortable with that. 

“We are going to have a period of time where insurers and [those] within the distribution network, including brokers…are going to have kind of a dual system,” he says. “There will still be claims that arise pre-Jan. 1, 2027, so operating in that space for a period of years is going to be very challenging.” 

Getting ready 

As insurers and brokers gear up for the new model, the most successful ones will be those who can best disseminate the changes to clients.  

“The biggest thing that an insurer can do to help improve their operational readiness for Day 1 is to focus on the people impact of what Care-first means,” he says. 

“We believe that the most successful insurers under a Care-first model are those that will recognize that it requires a blend of empathy, compassion, collaboration and a willingness to help get people better and get back to their daily lives.” 

Under Alberta’s new auto insurance system, insurers will provide comprehensive recovery support to their consumers with the goal of returning individuals to, or as close as possible to, their pre-accident function. It’s a hybrid no-fault model, that takes inspiration from other “care-based” provinces, with a few differences.  

“We’re calling it Care-first because no fault insurance is not really well known or understood,” says Mulyk. 

Other highlights under the new model include: unlimited access to treatment, such as chiropractic, physiotherapist or psychologist care, if needed; income replacement up to $125,000 per year until retirement; spousal support up to $600,000 in the event of a death; and permanent impairment benefits up to $295,000. 

Government says Albertans injured in an accident will be able to access these enhanced benefits more quickly, with more certainty, and without the need to sue in court. Albertans will still be able to sue in certain cases. 

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Alyssa DiSabatino

Alyssa Di Sabatino has been a reporter for Canadian Underwriter since 2021, covering industry trends, market developments, and emerging risks.