Some changes are coming to vehicle insurance in Alberta. 

On Jan.1, 2022, the province will adopt a Direct Compensation for Property Damage (DCPD) insurance model. 

Under DCPD, your own insurance company will pay for repairs to your vehicle when you are not at fault for a collision instead of going through the other party’s insurance. Kelly Nelson, a new business specialist with Smith Insurance, explained the change would make the claims process a lot faster. 
“It’s definitely better for the general public out there because their claims are going to be dealt with a lot faster, and that’s the biggest complaint we have is that we have, is that it takes so long for claims to be dealt with,” Nelson said. 

Changes are also coming to the way premiums are calculated to align with costs associated with vehicle repairs. This will mean owners of less expensive vehicles that cost less to repair will pay less for their insurance. On the flip side, owners of expensive vehicles that cost more to repair may pay a higher premium. 

According to the Insurance Bureau of Canada, 73 per cent of drivers will either see no increase to their premiums or will see an increase or decrease of less than five per cent. About 18 per cent of drivers will see a reduction of more than five per cent, while nine per cent will see an increase of greater than five per cent.

The changes will also allow people to ask for a deductible on their third-party liability. Nelson said this would give people another option to make their premiums lower. Still, they would have to pay the deductible even if they weren’t found to be at fault in the accident, whereas there currently isn’t any deductible for third-party liability.  

DCPD does not impact a consumer’s right to sue for other damages, like injuries, under the existing system.

The DCPD system is already used in almost every province in Canada.