The Smith Government has enacted major changes to the Automobile Insurance Act SA 2025 in order to establish a “no-fault” system of motor vehicle insurance. The government calls this new system the “Care-first” system. The new legislation is set to take effect on January 1, 2027.

Many Albertans are not aware of the very significant changes that are being made to car insurance in the province by this legislation.

The Care-first system replaces the current fault based tort law system which places the burden of motor vehicle accidents on the wrongdoer, and allows lawsuits to recovery compensation for personal injuries and for the economic losses which befall injured, innocent victims.

Instead, under the “Care-first” system, insurance companies will pay prescribed statutory benefits to individuals who sustain bodily injury or death in motor vehicle accidents, regardless of who is at fault for the accident. The amount of these benefits will be standardized and limited by regulations. The insurance companies will determine what benefits an injured person will be entitled to. An “Automobile Care-First Tribunal” will hear any disputes regarding the payment of benefits, in place of the courts.

The system will eliminate lawsuits for personal injuries sustained in accidents, except in very limited circumstances.

Critics of “Care-First” suggest that the new system will reduce compensation for injured parties, impose no consequences on wrongdoers, and is unlikely to reduce insurance premiums. A further criticism is that Care-First is designed to reduce costs for the insurance industry, and to promote the “stability and sustainability of the insurance system”, meaning the profits of insurance companies.

This session of Not So Common Law will summarize the new legislation, discuss how it is likely to play out, and consider whether it is of benefit to Albertans.