Alberta Premier Danielle Smith says her government is making major changes to auto insurance, including allowing rate hikes and switching to a predominantly no-fault claims model.

Under the new system, car accident victims in most cases won’t be able to sue the party responsible for their injury and, instead, insurers would pay compensation at rates set by the government.

The province said it commissioned two auto insurance reports, which showed that legal fees and legal costs tied to the current system significantly increase premiums. The province added collision-related lawsuits have nearly doubled in Alberta between 2018 and 2022.

By cutting down litigation costs, the government estimates that when the new system is in place in January 2027, it could lead to savings of up to $400 per year for the average insurance premium.

Alberta could be switching to a no-fault auto insurance system. The CBC's Travis McEwan & Jackie Halpern from McLeod Law LLP explain what it is — and what it could mean for the province's drivers.

Watch it here 

McLeod Law LLP’s tax lawyers have prepared this summary of Budget 2024 based on the needs and interests of our clients and their advisors; consequently, certain proposals included in Budget 2024 have been excluded intentionally from this summary. 

This summary is based on the contents of the budget speech delivered in Parliament on April 16, 2024 by the Deputy Prime Minister and Minister of Finance and a document released by the Government of Canada entitled “Federal Budget 2024 Tax Measures: Supplementary Information”, which stated that “additional design details will be released in the coming months”.