Alberta unveils draft auto insurance injury compensation rules

The Alberta government has released draft regulations detailing how compensation will be determined for Albertans permanently injured in vehicle collisions.

Source: Rawpixel

The Alberta government has released draft regulations detailing how compensation will be determined for Albertans permanently injured in vehicle collisions, as part of its upcoming no-fault auto insurance system set to take effect in 2027.

The proposed Permanent Injury Regulation, published just before the Thanksgiving weekend, establishes a compensation framework that assigns fixed dollar amounts to specific permanent injuries. The document outlines payments ranging from $945 for the loss of colour vision to $56,717 for the loss of an eye, and up to $66,169 for a moderate traumatic brain injury.

Under the same schedule, the loss of a pregnancy after 20 weeks would result in a payment of $18,906, while a pregnancy loss before 20 weeks would amount to $13,234. Partial amputation of a hand would receive $41,592.

According to the draft regulation, these payments would replace pain and suffering awards that are currently assessed by the courts. Insurers would determine whether an injury qualifies as permanent before compensation is issued.

The proposal is part of Alberta’s broader Care-First auto insurance reform, which the government says will simplify claims and make insurance more affordable by reducing legal costs and providing faster access to care.

In a statement to True North, the Ministry of Treasury Board and Finance said the new approach was developed using actuarial analysis, medical evidence, and national benchmarking that reflected the impacts of injuries.

“The draft regulation is designed to provide clarity and consistency for all Albertans, ensuring fair and predictable compensation,” the ministry said.

However, the ministry added that it is open to stakeholder feedback before any regulations are finalized.

“The new approach prioritizes timely care and recovery while reducing the need for lengthy and costly court processes,” said the spokesperson. “Today, many Albertans lose 30 to 40 per cent of their settlements to legal fees. Care-First eliminates that burden by creating a simpler, faster, and more transparent process—so compensation goes directly to injured Albertans, not to legal costs.”

Under the Care-First system, the government has said Albertans injured in collisions will have access to enhanced medical, rehabilitation, and income replacement benefits. Those with serious, lasting injuries will be eligible for one-time permanent impairment payments ranging up to approximately $298,520, depending on the degree of impairment.

When the Care-First framework was first introduced in 2024, Alberta’s government said the model would reduce annual insurance premiums by about $400 per driver. However, subsequent reports did not repeat that promise.

True North previously reported on Alberta Premier Danielle Smith defending the insurance reforms, arguing that no perfect solution to satisfy everyone existed.

“We’re trying to create a call your doctor first approach as opposed to call your lawyer first when you get into an accident, so you can get the care that they need and the income support that they need and still allow for some avenues for lawsuits,” said Smith. “I can tell you there isn’t a way to get 100 per cent agreement on the approach.”

Similar no-fault systems in other provinces, such as British Columbia, have faced criticism for limiting compensation and individual recourse in court.