Alberta’s Care-First auto insurance system takes effect on January 1, 2027, replacing the province’s court-based injury model with one where people injured in collisions claim benefits from their own insurer, regardless of who was at fault.
With renewal notices priced under Care-First going out since November 1, brokers are fielding client questions about what’s changing. The benefits apply automatically to collisions in Alberta from January 1, so drivers don’t need to do anything.
The largest change is to income replacement. Under the current system, injured drivers receive the lesser of $600 a week and 80% of average gross earnings, for up to two years after a collision, according to the Alberta government. Anything beyond that has to be pursued through the courts.
Under Care-First, income replacement rises to 90% of net income, up to a maximum gross yearly income adjusted annually, payable until age 65. Intact, in its published estimates of 2027 limits, puts that cap at $128,000. After 65, a retirement income benefit applies. Higher earners will be able to buy additional income protection.
The current cap on medical and rehabilitation benefits will be replaced by coverage for necessary treatment until maximum medical recovery. Benefits will also include personal care assistance and travel and accommodation costs related to treatment.
Care-First introduces a one-time permanent impairment payment for lasting, life-altering injuries. The Alberta government says this serves a purpose similar to pain and suffering damages in the court system. Intact’s 2027 estimates put the maximum at $306,580 for catastrophic injuries and $194,159 for non-catastrophic injuries.
The new system also includes caregiver benefits, childcare expense reimbursement, and death and funeral benefits.
No-fault benefits don’t mean fault no longer matters. Drivers who cause collisions can still face higher premiums, demerit points and charges. The reform changes how injury care and benefits are delivered, not drivers’ responsibility for how they drive.
The Automobile Insurance Rate Board has projected average savings of about $297 per private passenger vehicle, with larger reductions for young drivers. Individual premiums will still depend on driving record, vehicle and coverage choices. Critics, including the Alberta Civil Trial Lawyers Association, have questioned the savings projections and argued that limiting lawsuits reduces access to full compensation.
Brokers can expect three main questions. The first is why a client’s renewal differs from the advertised average. The second is what happens if they’re injured and the other driver was at fault. The third, from high earners, is whether the income cap leaves them underinsured.
That third question is where brokers can add the most value: Care-First caps income replacement, and clients earning well above the cap may need optional additional cover or disability insurance to close the gap.
