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What You Should Know About the Changes to Alberta Auto Insurance Rules

The Alberta government has made a significant change to the auto insurance rules, establishing a “direct compensation for property damage” (DCPD) system model for automobile insurance.

These Alberta car insurance changes impact every motorist and insurance firm in the province.

In this article, we will discuss Bill 41 and DCPD in detail. Continue reading to better understand the changes to Alberta car insurance rules.

Meanwhile, if you are looking for high-quality quotes for car insurance in Canada, visit this site to compare quotes from the top-rated Alberta car insurance providers with the advisors at Surex.

Bill 41

The Alberta government has issued modifications in Bill 41 aimed at lowering the cost of motor insurance by limiting certain claims, simplifying litigation, and lowering damage awards. The term “minor injury” has been broadened to include “clinically linked sequelae of a sprain, or strain, either physical or psychological injury, triggered due to the accident which does not lead to a substantial loss.”

Bill 41 limits the number of experts who can be employed in personal injury cases involving motor vehicles. Bill 41 proposes that:

  • Both parties cannot bring more than three witnesses and are allowed to provide only one report for each expert if the alleged damages are $100,000 or more.
  • Parties are allowed to call only one witness and present only one report if the alleged damages of the motor vehicle are $100,000 or less.

There are, however, some exceptions to the restrictions mentioned above.

What is DCPD coverage in Alberta?

DCPD coverage stands for Direct Compensation for Property Damage. If you’re in an automobile accident that wasn’t your fault, your insurance company is bound to pay for the repair costs. It will, after that, be in charge of obtaining compensation from the insurance companies of other drivers involved in the accident.

Following a collision, DCPD pays for basic property damage (such as a smashed-in fender or a cracked windshield) and any damaged items inside the car, and lost vehicle use.

According to Alberta’s Automobile Insurance Rate Board, drivers in a DCPD model will not be responsible for these costs if they are considered at no fault for a collision. It does not matter which insurance company you’re associated with, DCPD is mandatory in Alberta, so you’ll be insured regardless of who your insurance provider is.

Major changes in insurance rules

The following are the most critical points to remember about the changes to Alberta auto insurance rules:

1. Your car insurance provider will pay the bills if your car is damaged in an accident

No matter whose fault it was, your own car insurance provider (not the other drivers) will pay the bills for your car’s damage caused by an accident.

2. The new policy will only cover damages, not physical injuries

Damage to your car and its contents is a specialty of DCPD coverage in Alberta. This new approach will not affect your ability to sue for damages or receive compensation for the same.

3. No-fault system

It’s still necessary to find fault. It evaluates which plan applies to the claim and whether a penalty is required. It’s also worth noting that if you weren’t responsible for the accident, it would not affect your premium.

4. Nothing is required of you

You don’t need to do anything special to acquire DCPD coverage. The changes in your insurance policy automatically took place on January 1, 2022. Since the beginning of the year, DCPD has been included in all new policies offered.

What does direct compensation for property damage not cover?

As important as it is to understand what is included in Direct Compensation for Property Damage (DCPD), it is also important to understand what is excluded from the DCPD:

  • Drivers who seek coverage in the event of an at-fault accident must get collision insurance.
  • DCPD coverage is unable to assist hit-and-run victims. Your insurance company will be unable to charge a third party if their coverage provider cannot be located.

How will the government’s changes to Alberta auto insurance rules assist customers in saving money?

The most significant element in Alberta drivers’ premium hikes has been substantially increasing claims expenses and expenditures for the settlement of claims related to minor cuts and bruises after an accident.

The minor injury criteria and the amount paid on suffering and pain settlements, which were significantly higher than today’s interest rates and contributed to soaring claims expenses, were also changed. To put things in perspective, the average amount of accidental damage claims increased by around 80% between 2011 and 2019. Insurance rates had to grow to cover the rising costs of claims payments.

According to the insurance companies, the government’s measures may assist in keeping premiums sustainable.

Frequently asked questions

Here are some common questions asked about Alberta’s new car insurance rules:

What is the DCPD system in Alberta?

Alberta has established a Direct Compensation for Property Damage (DCPD) system to simplify how Alberta’s insurers assist their clients after an accident. If you’re not at blame for an accident, your insurance carrier covers damages to your car.

What are the advantages and disadvantages of having no-fault coverage?

The advantages of no-fault insurance include quick claim payouts following an accident and fewer litigation for minor injuries. The disadvantages of no-fault insurance include higher auto insurance premiums and more difficulty in receiving reimbursement for suffering and pain.

Does DCPD cover all no-fault cases?

No. DCPD is designed to cover you when you are not at blame in case of a collision. However, it doesn’t cover no-fault situations. For instance, hit-and-run cases are not included in the DCPD system.


DCPD is a more equitable and efficient method for insurance payouts and car repairs that is already in use in most Canadian provinces. Damage to your car will be fixed quickly without any delays and complexities that often occur while negotiating with the insurer of the third-party driver.

DCPD lowers the cost of subrogation, the procedure by which insurance identifies who covers a claim after an accident. Along with many other measures, it will aid in the long-term stabilization of premiums.

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