$3.1M in fines: How Alberta is holding auto insurers accountable
A new report from Alberta’s Superintendent of Insurance reveals more than 21 auto insurance companies have been fined for overcharging customers. The total penalties rack up to $3.1 million over two years, from 2022 to 2024.
The fines highlight the need to hold insurers accountable, and Alberta is taking action. According to the report, a group of Alberta auto insurance companies have been fined between $5,000 to $1 million.
For policyholders, this may come as welcome news as they continue to get hit with increased premiums year after year.
Key takeaways
- 21 auto insurance companies in Alberta have been fined for overcharging customers – a total of $3.1M.
- The overcharges were unintentional, resulting from credit score errors and system upgrades.
- Policyholders have been refunded with interest.
- This incident highlights the need for greater transparency in premium calculations and for insurers to be held accountable.
What led to the overcharging?
According to notice 01-2025, the errors were unintentional and resulted from issues such as incorrectly applied discounts and surcharges, credit score errors, and software system upgrades.
The Superintendent examined insurers with a history of overcharging customers in the past and looked closely at the procedures used for insurance ratings.
What happens if you are overcharged?
It’s been confirmed that insurers have refunded their customers the over-charged amounts with interest. So policyholders can expect to receive a payment from their insurance companies.
Auto insurance in Alberta
The provincial government has announced plans to introduce a traditional no-fault insurance auto system in 2027. This will decrease the time to claim payout, increase compensation benefits and is expected to save policyholders up to $400 annually.
However, the shift to a no-fault system is not without criticism, especially in light of insurers overcharging premiums in Alberta.
In a press release from FAIR Alberta, a spokesperson Jackie Halpern said, “The fact that insurers have been caught and fined for overcharging Albertans should set off alarm bells, yet this is the same industry that will now be given even more control under a no-fault insurance regime.”
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How to keep insurance companies accountable
The rules and regulations of insurers vary by province, so it can be tricky to ensure accountability. However, recurring instances of overcharging in Alberta highlight the need for greater transparency in premium calculations.
The province’s decision to impose hefty fines is a step toward enforcing fairer pricing while encouraging companies to improve their rating systems to avoid further penalties. Ongoing oversight is essential to protect customers from future overcharging.
With insurance rates only increasing across Canada, policyholders – and their wallets – bear the financial burden. While it may not always feel like you have control over your insurance, the one thing as a customer that you can still do is shop the market - remember to compare car insurance quotes to help navigate the rising rates.
The bottom line
Alberta’s Superintendent of Insurance is holding auto insurers accountable for overcharging premiums. As policy rates continue to rise, there is a growing demand for greater transparency and stricter oversight of insurers’ rating systems.
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Alyssa Prizzon, Content Marketing Strategist
Alyssa Prizzon is a content marketer with 5+ years of experience crafting search-optimized blogs and articles across diverse industries, including finance, technology, and more.