Cheapest Car Insurance in Alberta

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• How does Alberta car insurance work?
• Mandatory and optional auto insurance coverage in Alberta
• How to get the cheapest Alberta car insurance quote
• How much does car insurance in Alberta cost?
• Cheapest car insurance in Alberta 2023
• Alberta car insurance rates by city
• Factors that influence your auto insurance premium
• 10 tips for getting cheaper car insurance in Alberta
• Alberta car insurance quotes by age group and gender
• Cars with the cheapest insurance in Alberta 2023
• Cheapest car insurance companies in Alberta
• Frequently asked questions about Alberta car insurance

How does Alberta car insurance work?

Every driver in Canada must have car insurance; it's required by law in each province.

Alberta has a private car insurance market, but its rates are regulated by the provincial government’s Grid rating program. This approach, which is unique in Canada, is designed to ensure that the minimum required coverage remains affordable.

The regulator, the Alberta Automobile Insurance Rate Board (AIRB), approves or denies rate increases requested by private insurance companies.

The Grid rating program

AIRB is also the group behind the Grid rating program. First introduced in 2004, the Grid dictates the maximum premium that insurers can charge for basic coverage (i.e. third-party liability, accident benefits and direct compensation property damage). For optional coverage beyond basic, insurance companies set their own rates without intervention from the regulatory board.

Where a driver lands on the Grid is determined by several factors, including the number of years they’ve been licensed, any at-fault claims or speeding tickets on their record, and if they’ve completed an approved driver training program.

Drivers move up or down on the Grid as their driving record changes. The lower their Grid Level, the cheaper your insurance rate.

Less experienced drivers generally face the highest premiums, but Grid often caps their basic rates. Each at-fault claim moves the driver five steps up the Grid, and this can increase their insurance premium by hundreds to thousands of dollars.

If convicted or found at-fault for an accident, an Alberta might also be hit with surcharges on top of their premium.

A safe and experienced driver can expect to pay less than Grid rates. According to the AIRB, about 94.5% of Alberta drivers pay less than the maximum set out by the Grid program.

An Alberta insurance provider determining a car insurance premium for a driver seeking basic coverage must offer a premium reflected on the grid if it’s cheaper than the premium they would have otherwise quoted.

How much does car insurance in Alberta cost?

Alberta auto insurance prices are as varied and diverse as the province itself. According to the RATESDOTCA Insuramap, average premiums range as high as $1,793 per year for people living in Blackfalds or $1,741 for Calgarians to a low of $1,286 for the residents of Medicine Hat. The provincial average is $1,468 per year.

Places like Calgary, which are large by Alberta standards, have greater urban density, which means traffic infractions and thefts occur at a higher rate. Many people commute into the city for work, meaning more people spend time on the road. All these factors lead to a greater abundance of claims.

While Blackfalds is not a large town and sits just north of Red Deer, it is the centre point between Edmonton and Calgary. A lot of traffic and potential for risk comes and goes through it, and during winter months, has seen pileups and accidents on Highway 2.

On the other hand, Medicine Hat sits outside of the Calgary-Edmonton corridor and has a relatively small population. Car insurance is determined by factors such as location, driving habits and population density. With a smaller population and fewer chances for crime and risks, rates remain low in the area. 

Cheapest car insurance in Alberta 2023 

Medicine Hat is the cheapest city in Alberta for insurance at $1,286 per year. The provincial average for 2023 stands at $1,468, which is 12.4% higher than Medicine Hat rates.

Medicine Hat is Alberta’s seventh largest city, and the cost of living is relatively cheap compared to other areas in the province and the country, according to the Alberta Living Wage Network. Its lower rates are likely partly due to fewer cars: about 23,000 people report using a car as their primary mode of transportation, while in Calgary, close to 437,000 rely on their car daily, according to 2021 data from Statistics Canada.

Alberta car insurance rates by city 2023

Using the RATESDOTCA Auto Insuramap, it’s clear that drivers in Blackfalds and Fitzgerald are paying the highest average car insurance premiums at a rate of $1,793 and $1,752, respectively.

Drivers in Calgary are slightly lower at $1,741, while people in Edmonton are at the bottom of the top five list, with an annual rate of $1,586 per year.

Insurance rates in Alberta are determined by many factors, including such things as:

• Driving history
• Infractions
• Claims history
• Location
• Cost of replacement

Below are the five cities with the highest insurance premiums:

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Factors that influence your Alberta auto insurance premium

Age 

Alberta insurance companies look at age as a risk factor when determining your auto insurance premiums. Younger, less experienced male drivers, for example, pay the most for car insurance. Insurance companies consider them especially risky to cover and less responsible than older, more mature drivers.

The vehicle you drive 

Expensive or high-performance cars cost a lot to repair, maintain, and replace if stolen. If you own a more "basic" car with few or standard options, your Alberta insurance rates may be lower because replacement values are lower as well.

Where you live 

Location is an important factor in determining your Alberta car insurance. High crime or high-risk areas could lead to theft and vandalism. You may also live in an area with high claims activity, which will influence your rates.

Your driving record

A clean driving record with no infractions will help you keep your Alberta auto insurance cheap.

Your insurance history 

Insurance companies look at your history to determine your Alberta insurance rates. Keep claims low or non-existent. Also, failure to pay your premium or paying late might not only affect your credit score but also raise your risk factor in the eyes of your Alberta insurance provider.

The coverage options you choose to include in your policy 

Having auto insurance in Alberta is mandatory. You must have at least basic insurance, which covers accident benefits and third-party liability.

But you can also add other optional coverages, which will raise your premiums. This can include:

• Collision: Provides coverage for damage to your vehicle caused by a crash or rollover for which you are at fault.
• Comprehensive: Provides coverage for damage to your vehicle not caused by a collision, such as vehicle theft, vandalism, fire and animal collision.
• Glass: This special coverage provides coverage for all glass on your vehicle if you have reduced glass coverage on your auto policy using SEF 13D.

Your policy's deductibles 

Increasing deductibles and paying upfront prior to any claims helps decrease your risk factor in the eyes of your Alberta insurance provider. Talk to your provider or agent about where you can save and how much your budget will allow when considering deductibles.

If you're bundling with other insurance products, such as home insurance 

Bundling various insurance products under one provider is a great way to save on premiums. Insurance companies thank you for your loyalty with discounts.

Gender and marital status 

Provinces such as Ontario, Quebec and Alberta consider gender and marital status when determining your Alberta auto insurance premiums. Like the age factor, insurance providers think single drivers are a little less settled down than married ones and maybe have less experience or higher risk.

The company's own insurance claims history 

Insurance companies have a tight line to walk in terms of meeting obligations and ensuring they have the money to do so. If insurers see that claim settlements are outpacing revenue from premiums (the relationship is tracked using a metric known as the 'combined ratio'), they will their customers' increase rates.

Alberta car insurance quotes by age group and gender

The chart above reflects an interesting trend that is quite well-known about auto insurance rates. Men, especially younger men in their 20s and younger pay the most out of any group for auto insurance. As you age and gain more driving experience, rates come down significantly. Drivers above 60 are in the sweet spot of cheap Alberta auto insurance, as men and women pay $1,474.27 and $1,426.31, respectively.

Premium data is from real InsuranceHotline.com quotes.

Cheapest car insurance companies in Alberta

Who doesn't want a deal? Especially when it comes to finding the cheapest car insurance companies in Alberta. But just like all drivers are not alike, the same is true for insurance providers.

Insurance providers will base their premiums on your driving and claim history, location, vehicle type, age and gender, and other factors. That's step one.

But the quotes you receive from providers will vary, and there is no flat rate. What you can do is compare quotes on sites like InsuranceHotline.com to ensure you are finding the cheapest Alberta auto insurance that suits your individual needs. By plugging in your individual needs and circumstances, you will get the cheapest rates that pertain to you.

Let's look at these examples based on a 25-year-old man from Calgary:

The table shows that for a 25-year-old male driver with a clean driving record in Calgary, insuring three cars under three different carriers will yield three very different rates.

While the driver is the same in each case, the other factors are not. That’s why comparing insurance quotes on sites like InsuranceHotline.com is so important when seeking Alberta auto insurance. It’s efficient, provides the cheapest rates, and will do so from the top providers in the province.