IBAA Leads Collaborative Effort to Expand Access to Optional Vehicle Coverage for Albertans

Brokers Association celebrates collaboration with Facility Association and the Government of Alberta on expanding auto insurance eligibility.

EDMONTON, AB, NOVEMBER 4, 2025/insPRESS/ – The Insurance Brokers Association of Alberta (IBAA), in collaboration with Facility Association and the Government of Alberta, is proud to announce significant changes to the eligibility criteria for Section C (Optional Physical Damage) coverage under the Facility Association Residual Market (FARM) for Private Passenger Vehicles. Effective January 1, 2026, these changes will make coverage more accessible to Albertans province wide.

In May 2025, the IBAA initiated discussions with Facility Association, which addressed the growing concerns from consumers and brokers regarding the increasing difficulty Albertans have in accessing Section C coverage. Currently, residents who do not qualify for the optional, yet critical, coverage within the regular market face the difficult decision of shouldering overly expensive premiums or in many cases, simply driving without collision protection.

Facility quickly took on the issue, and after months of discussion and deliberation between the non-profit and the Government of Alberta, the following changes were developed to be implemented on January 1, 2026, for new business and February 1, 2026, for renewals:

• Expanded Eligibility (Rule 107): Residents who have been declined Section C coverage by a voluntary market auto insurer are now eligible for placement in the Residual Market.
  • Declaration Letter Requirement: To be considered for placement, a Declaration Letter indicating the decline of Section C coverage must be submitted with new business applications and with each renewal.
• Entry Criteria Change (Rule 100.A.1): Those who do not meet the definition of a residual market risk in Rule 107 are not eligible for placement.
• Leased Vehicles and Lienholders (Rule 127.C): If optional physical damage coverage is amended or deleted on a leased vehicle, or one with a lienholder, the Servicing Carrier must notify the lessor or lienholder. If a Declaration Letter is received and coverage is amended or removed, the risk may be lapsed on renewal.

“The change that has been made to the eligibility criteria for the Facility Association Residual Market is good news for consumers who were having trouble finding Section C coverage and good news for brokers who unable to secure the coverage for some clients as part of a complete auto policy,” said Saskia Matheson, President & CEO of Facility Association. “Facility believes that consumers are best served by a competitive and available insurance market. In the end, this is an excellent example of how industry stakeholders can work together and work with government to address an emerging or ongoing issue.”

It is through the collaborative efforts of Facility Association, the Government of Alberta, and the Association that there will be an expansion of the eligibility criteria within Facility Association. We anticipate that this will allow more Albertans greater access to collision and comprehensive coverage and more peace of mind.

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IBAA is a non-profit trade association representing over 4200 broker members working through about 260 individual brokerages in communities across Alberta, the Yukon, the Northwest Territories, and Nunavut.

If you would like more information about our position on the above, please contact Jhnel Weller-Hannaway at 780-413-2821 or jwellerhannaway@ibaa.ca