The Alberta government says it will not approve any more rate hikes for auto insurance on private passenger vehicles until the end of the year — a move the Opposition NDP calls a “fake freeze.”
“We share Albertans’ concerns about the rising cost of living during the current inflation crisis,” Finance Minister Travis Toews said in a statement Thursday.
“We will continue to meet with members of the insurance industry to find additional longer-term solutions for automobile insurance.”
The province said despite the freeze, Alberta drivers may still see rate increases on their renewals this year due to a range of factors, including traffic tickets and previously approved rate hikes.
The move comes three years after the United Conservative Party government lifted a cap on hikes imposed by its NDP predecessors.
Toews had previously resisted calls to reinstitute the cap, calling it an ineffective stopgap solution while pointing to reforms his government made in 2020 to stabilize rates over the long haul.
The government said current factors like inflation and supply chain issues for auto parts are affecting rates in the short term and must be addressed.
Premier Danielle Smith had called for her government to take action on insurance late last year, after a report commissioned by the Insurance Corporation of British Columbia found Albertans are paying among the highest rates in Canada.
NDP finance critic Shannon Phillips called the announcement “a fake freeze.”
“By (the government’s) own admission, Albertans could still see their rates increase this year.”
Phillips said after the UCP lifted the rate cap, premiums rose by as much as 30 per cent during the COVID-19 pandemic.
“Now Albertans are paying for the most expensive auto insurance in the country in the midst of the worst affordability crisis in 40 years,” said Phillips in a statement.
“For years, the UCP claimed rate caps don’t work. Only weeks ago, Danielle Smith and Travis Toews blocked Alberta NDP legislation that would have immediately put a real freeze on insurance rates.
“Now the UCP is in chaos, and they’re too incompetent to even implement a real rate freeze.”