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Alberta

Insurance rate increases absolutely unacceptable: NDP Critic for Service Alberta

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This post was submitted by Jon Carson, NDP MLA for Edmonton-West Henday, Opposition Critic for Service Alberta

Thirty per cent.

That’s how much auto insurance rates skyrocketed by for some Albertans at the end of this year, after Premier Jason Kenney and the UCP removed the five per cent cap on rate increases that our NDP government brought in, taking a “no limit” approach to how much insurance companies could actually raise rates.

The jump was immediate.

Albertans saw a wave of premium increases bordering on price gouging. Over 90% of car insurance companies filed for rate increases as soon as the cap was lifted, and rushed to bill drivers as soon as they could. Of the companies that received approved rate changes, the increases ranged from 4.9 per cent to an eye-popping 29.8 per cent.

It was a nice gift from Jason Kenney, who already slammed families for hundreds of dollars of new costs in his fall budget, including hikes to income tax, property tax, as well as more in school fees, prescription drugs and college tuition.

As usual, Finance Minister Travis Toews trotted out the UCP’s one-trick pony and blamed the NDP, claiming that insurance companies were set to pack their bags and flee the province if he didn’t let them jack up premiums beyond five per cent.

The lobbying effort came out in full force. The brokers, the insurance companies, and the Insurance Bureau of Canada are working overtime to sell quite the sob story: a massive spike in claims costs, not enough options for drivers, etc, etc. It’s tough times for the poor, little ol’ car insurance company.

What a load. These are some of the biggest and most profitable companies in Canada, and they simply want back the power they had to jack up premiums hand over fist.

The truth is that claims costs over the past few years are level, a fact that’s supported by the Insurance Bureau of Canada‘s own data. In fact, an actuarial analysis by Fair Alberta Injury Regulators, an organization made up of concerned Albertans, doctors and legal experts, found that injury payouts have stabilized in the last few years, and even started to dip in 2019. Their actuary specifically found evidence that claims are “not skyrocketing.”

This is further supported by the Alberta Superintendent of Insurance, responsible for all regulatory oversight of insurers operating in Alberta with a specific duty to ensure that insurance companies treat Albertans fairly. In his annual report for 2018, he found on average that the claims ratio for car insurance was 80 per cent across all companies in Alberta. Not the 120 per cent figure the insurance companies trot out on TV.

And while the UCP Government continues to claim they have documents to prove the cap made the car insurance industry unsustainable, they haven’t provided a single piece of paper showing any of these companies would bail if they could–GASP–only raise premiums five per cent every year.

So why remove the cap? Well, in politics, it’s who you know. And Jason Kenney knows an awful lot of people in the insurance industry. Namely, his former chief of staff and campaign director Nick Koolsbergen, who was hired to lobby the Premier on behalf of the car insurance industry just last year. He has Kenney’s cell phone number.

Sounds like a good guy to have on your side… if you’re a car insurance company.

The fact is, these companies turn a profit of tens of millions of dollars each year. They’re used to having carte blanche in Alberta, and they want it back.

Under the thinly-veiled guise of “red tape reduction”, the UCP has struck a panel looking at more regulatory changes that the insurance lobby itself has said “could also change the rate regulation framework that governs how insurers set premiums.”

If costs are going to go up even more, who will Jason Kenney look out for? His friends and interests in big insurance? Or everyday Albertans driving to work?

Knowing Jason Kenney, Albertans should brace for impact.

Jon Carson is the MLA for Edmonton-West Henday and the Alberta NDP Opposition Critic for Service Alberta.

After 15 years as a TV reporter with Global and CBC and as news director of RDTV in Red Deer, Duane set out on his own 2008 as a visual storyteller. During this period, he became fascinated with a burgeoning online world and how it could better serve local communities. This fascination led to Todayville, launched in 2016.

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Alberta

Albertans have contributed $53.6 billion to the retirement of Canadians in other provinces

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From the Fraser Institute

By Tegan Hill and Nathaniel Li

Albertans contributed $53.6 billion more to CPP then retirees in Alberta received from it from 1981 to 2022

Albertans’ net contribution to the Canada Pension Plan —meaning the amount Albertans paid into the program over and above what retirees in Alberta
received in CPP payments—was more than six times as much as any other province at $53.6 billion from 1981 to 2022, finds a new report published today by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.

“Albertan workers have been helping to fund the retirement of Canadians from coast to coast for decades, and Canadians ought to know that without Alberta, the Canada Pension Plan would look much different,” said Tegan Hill, director of Alberta policy at the Fraser Institute and co-author of Understanding Alberta’s Role in National Programs, Including the Canada Pension Plan.

From 1981 to 2022, Alberta workers contributed 14.4 per cent (on average) of the total CPP premiums paid—Canada’s compulsory, government- operated retirement pension plan—while retirees in the province received only 10.0 per cent of the payments. Alberta’s net contribution over that period was $53.6 billion.

Crucially, only residents in two provinces—Alberta and British Columbia—paid more into the CPP than retirees in those provinces received in benefits, and Alberta’s contribution was six times greater than BC’s.

The reason Albertans have paid such an outsized contribution to federal and national programs, including the CPP, in recent years is because of the province’s relatively high rates of employment, higher average incomes, and younger population.

As such, if Alberta withdrew from the CPP, Alberta workers could expect to receive the same retirement benefits but at a lower cost (i.e. lower payroll tax) than other Canadians, while the payroll tax would likely have to increase for the rest of the country (excluding Quebec) to maintain the same benefits.

“Given current demographic projections, immigration patterns, and Alberta’s long history of leading the provinces in economic growth, Albertan workers will likely continue to pay more into it than Albertan retirees get back from it,” Hill said.

Understanding Alberta’s Role in National Programs, Including the Canada Pension Plan

  • Understanding Alberta’s role in national income transfers and other important programs is crucial to informing the broader debate around Alberta’s possible withdrawal from the Canada Pension Plan (CPP).
  • Due to Alberta’s relatively high rates of employment, higher average incomes, and younger population, Albertans contribute significantly more to federal revenues than they receive back in federal spending.
  • From 1981 to 2022, Alberta workers contributed 14.4 percent (on average) of the total CPP premiums paid while retirees in the province received only 10.0 percent of the payments. Albertans net contribution was $53.6 billion over the period—approximately six times greater than British Columbia’s net contribution (the only other net contributor).
  • Given current demographic projections, immigration patterns, and Alberta’s long history of leading the provinces in economic growth and income levels, Alberta’s central role in funding national programs is unlikely to change in the foreseeable future.
  • Due to Albertans’ disproportionate net contribution to the CPP, the current base CPP contribution rate would likely have to increase to remain sustainable if Alberta withdrew from the plan. Similarly, Alberta’s stand-alone rate would be lower than the current CPP rate.

 

Tegan Hill

Director, Alberta Policy, Fraser Institute

Nathaniel Li

Senior Economist, Fraser Institute
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Alberta

Alberta Institute urging Premier Smith to follow Saskatchewan and drop Industrial Carbon Tax

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From the Alberta Institute

Axe Alberta’s Industrial Carbon Tax

Aside from tariffs, carbon taxes have been the key topic of the election campaign so far, with Mark Carney announcing that the Liberals would copy the Conservatives’ long-standing policy to axe the tax – but with a big caveat.

You see, it’s misleading to talk about the carbon tax as if it were a single policy.

In fact, that’s what the Liberals would like you to think because it helps them hide all the other carbon taxes they’ve forced on Canadians and on the Provinces.

Broadly speaking, there are actually four types of carbon taxes in place in Canada:

  1. A federal consumer carbon tax
  2. A federal industrial carbon tax
  3. Various provincial consumer carbon taxes
  4. Various provincial industrial carbon taxes

Alberta was actually the first jurisdiction anywhere in North America to introduce a carbon tax in 2007, when Premier Ed Stelmach introduced a provincial industrial carbon tax.

Then, as we all know, the Alberta NDP introduced a provincial consumer carbon tax in 2017.

The provincial consumer carbon tax was short-lived, as the UCP repealed it in 2019.

But, unfortunately, the UCP failed to repeal the provincial industrial carbon tax at the same time.

Worse, by then, the federal Liberals had introduced a federal consumer carbon tax and a federal industrial carbon tax as well!

Flash forward to 2025, and the political calculus has changed dramatically.

Mark Carney might only be promising to get rid of the federal consumer carbon tax, but Pierre Poilievre is promising to get rid of both the federal consumer carbon tax and the federal industrial carbon tax.

This is a clear opportunity, and yesterday, Scott Moe jumped on it.

He announced that Saskatchewan will also be repealing its provincial industrial carbon tax.

Saskatchewan never had a provincial consumer carbon tax, which means that, within just a few weeks, people in Saskatchewan could be paying ZERO carbon tax of ANY kind.

Alberta needs to follow Saskatchewan’s lead.

The Alberta government should immediately repeal Alberta’s provincial industrial carbon tax.

There’s no excuse for our provincial government to continue burdening our industries with unnecessary costs that hurt competitiveness and deter investment.

These taxes make it harder for businesses to thrive, grow, and create jobs, especially when other provinces are taking action to eliminate similar policies.

Premier Danielle Smith must act now and eliminate the provincial industrial carbon tax in Alberta.

If you agree, please sign our petition calling on the Alberta government to Axe Alberta’s Industrial Carbon Tax today:

 

 

After you’ve signed, please send the petition to your friends, family, and wider network, so that every Albertan can have their voice heard!

– The Alberta Institute Team

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