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UCP to unveil plan for skyrocketing auto insurance rates

Last Updated Oct 29, 2020 at 7:23 am MST

(iStock Photo)

The UCP government removed the cap on insurance premiums last December

The NDP is calling for the cap to be reinstated or for government-run insurance to be introduced

EDMONTON (660 NEWS) – Drivers are paying more to get behind the wheel and the Alberta NDP is calling on the Kenney government to do something about it.

Finance Minister Travis Toews is expected to make an announcement Thursday on Bill 41, the Insurance Amendment Act to address the affordability of insurance and other improvements to the system.

Last year the United Conservative government removed the five per cent rate cap on premiums set by the former NDP government.

Since then, auto insurance rates have risen significantly.

Statistics Canada shows Albertans paid on average 17 per cent more for insurance in January 2020 compared to the same time in 2019.

WATCH: UCP not renewing cap on auto insurance

The agency said insurers submitted applications to increase rates after the UCP removed the cap resulting in Alberta’s largest month-over-month increase in vehicle insurance premiums (7.6 per cent) since November 2002.

During Question Period on Wednesday, NDP leader Rachel Notley called this unacceptable and asked the government to freeze rates until 2021 or look at establishing government-run insurance.

Toews rejected both ideas. Saying the UCP is not considering following in B.C. or Saskatchewan’s footsteps with public insurance coverage, and said freezing rates makes the problem worse.

Last December, the UCP announced a review panel to look at rising insurance costs and launched an online survey in February to gather Albertans opinions on how to address the spike in premiums.

The Insurance Bureau of Canada reported earlier this year that Alberta has the third highest average insurance rates in Canada at just over $1,300 in 2018.

Toews will address Bill 41 and auto insurance prices in a news conference on Thursday before introducing the legislation later in the afternoon.

-With files from CityNews Edmonton